Insurance Circular Letter No. 13 (2019)
December 20, 2019
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TO: |
All Insurers Authorized to Write Accident and Health Insurance in New York State, Article 43 Corporations, Health Maintenance Organizations, Student Health Plans Certified Pursuant to Insurance Law § 1124, and Municipal Cooperative Health Benefit Plans |
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RE: |
Health Insurance Coverage for Mental Health Conditions and Substance Use Disorder |
STATUTORY AND REGULATORY REFERENCES: N.Y. Ins. Law §§ 3201, 3216, 3217-a, 3221, 4303, 4324, and Article 49; N.Y. Pub. Health Law Articles 44 and 49; 29 U.S.C. § 1185a; 42 U.S.C. § 300gg-1 et seq.; 42 U.S.C. § 18001 et seq.; and 45 C.F.R. Parts 146 and 147
I. Purpose
Chapter 57 of the Laws of 2019 (“Chapter 57 of 2019”) amended the Insurance Law and Public Health Law with respect to health insurance coverage for mental health and substance use disorder (“SUD”) treatment. The new provisions are effective on January 1, 2020 and apply to insurance policies and contracts issued, renewed, modified, altered, or amended on or after such date. This circular letter provides direction to insurers authorized to write accident and health insurance in New York State, article 43 corporations, health maintenance organizations, student health plans certified pursuant to Insurance Law § 1124, and municipal cooperative health benefit plans (collectively, “issuers”) regarding the implementation of the new requirements.
This circular letter supplements Insurance Circular Letters No. 13 (2018), No. 16 (2017), No. 14 (2017), No. 6 (2016), and No. 6 (2015).
II. Substance Use Disorder
A. Prohibition Against Preauthorization and Concurrent Review During First 28 Days of Inpatient Admission for Treatment of a SUD
Chapter 71 of the Laws of 2016 added Insurance Law §§ 3216(i)(30)(D), 3221(l)(6)(D), and 4303(k)(4), which apply when inpatient treatment is provided in New York facilities that are certified by the Office of Addiction Services and Supports (“OASAS”) and participate in the issuer’s provider network. These provisions prohibit issuers from performing preauthorization for inpatient admission for treatment of a SUD. They also prohibit issuers from performing concurrent utilization review during the first 14 days of the inpatient admission, provided that the facility notifies the issuer of both the admission and the initial treatment plan within 48 hours of the admission. They further provide that an insured shall not have any financial obligation to the facility for the inpatient treatment other than any copayment, coinsurance, or deductible otherwise required under the policy or contract.
Chapter 57 of 2019 amended the above-referenced sections by expanding the facilities covered by the law to include those facilities licensed or authorized by OASAS and extending the prohibition against concurrent review to the first 28 days of an inpatient admission. It also changed the time period for the facility to notify the issuer of the inpatient admission from 48 hours to “two business days.” In addition, Chapter 57 of 2019 requires the facility to perform a periodic consultation with the issuer at or just prior to the 14th day of treatment to ensure that the facility is using the evidence-based and peer-reviewed clinical review tool used by the issuer that is designated by OASAS and appropriate to the patient’s age to ensure that the inpatient treatment is medically necessary for the patient.
Chapter 57 of 2019 also added a requirement that, prior to discharge, the facility must provide the patient and the issuer with a written discharge plan describing the arrangements for additional services needed following discharge from the inpatient facility as determined using the evidence-based and peer-reviewed clinical review tool used by the issuer that is designated by OASAS. Further, prior to discharge, the facility is required to indicate to the issuer whether the services included in the discharge plan are secured or determined to be reasonably available.
B. Prohibition Against Preauthorization and Concurrent Review During First Four Weeks of Outpatient Treatment of a SUD
Chapter 57 of the Laws of 2018 (“Chapter 57 of 2018”) added Insurance Law §§ 3216(i)(31)(E), 3221(l)(7)(E), and 4303(l)(5), which apply when treatment is provided by New York outpatient facilities that are certified by OASAS and participate in the issuer’s provider network. These provisions prohibit issuers from performing preauthorization for outpatient services for treatment of a SUD. They also prohibit issuers from performing concurrent utilization review during the first two weeks of continuous treatment, not to exceed 14 visits, provided that the facility notifies the issuer of both the start of treatment and the initial treatment plan within 48 hours. They further provide that an insured shall not have any financial obligation to the facility for the outpatient treatment other than any copayment, coinsurance, or deductible otherwise required under the policy or contract.
Chapter 57 of 2019 amended the above-referenced sections by expanding the types of facilities covered by the law to include those licensed or authorized by OASAS and extending the prohibition against concurrent review from two to four weeks, not to exceed 28 visits. It also changed the time period for the facility to notify the issuer of the outpatient treatment from 48 hours to “two business days.” Chapter 57 of 2019 added a requirement that the facility perform periodic consultation with the issuer at or just prior to the 14th day of treatment to ensure that the facility is using the evidence-based and peer-reviewed clinical review tool used by the issuer that is designated by OASAS and appropriate to the age of the patient to ensure that the outpatient treatment is medically necessary for the patient.
C. Requests for Medical Necessity Criteria
Chapter 57 of 2019 added Insurance Law §§ 3216(i)(30)(E), 3216(i)(31)(F), 3221(l)(6)(E), 3221(l)(7)(F), 4303(k)(5), and 4303(l)(6), which require an issuer to make available to any insured, prospective insured, or in-network provider, upon request, the criteria it uses in its medical necessity determinations for inpatient and outpatient SUD treatment.
D. Prescription Medications to Treat a SUD
Chapter 69 of the Laws of 2016 added Insurance Law §§ 3216(i)(31-a), 3221(l)(7-b), and 4303(l-2), which require every insurance policy or contract that provides medical, major medical, or similar comprehensive-type coverage and provides coverage for prescription drugs for the treatment of a SUD, to include immediate access, without prior authorization, to a five-day emergency supply of prescribed medications otherwise covered under the policy or contract for the treatment of a SUD where an emergency condition exists, including a prescribed drug or medication associated with the management of opioid withdrawal and/or stabilization, except where otherwise prohibited by law.
Chapter 57 of 2019 amended those sections and expands on the existing law by requiring that every policy or contract that provides medical, major medical, or similar comprehensive-type coverage and provides coverage for prescription drugs for the treatment of SUD, include immediate access, without prior authorization, to the formulary forms of prescribed medication covered under the policy or contract for the treatment of a SUD, including a prescribed drug or medication associated with the management of opioid withdrawal and/or stabilization, except where otherwise prohibited by law. Under Chapter 57 of 2019, the requirement to provide immediate access with no prior authorization is not limited to an emergency supply of the prescription drug to treat a SUD, but rather applies to all formulary forms of prescribed medication that are covered under the policy or contract. Chapter 57 of 2019 also expands the requirement to provide immediate access without prior authorization to opioid overdose reversal medication otherwise covered under the policy or contract that is prescribed or dispensed to an individual covered under the policy or contract.
E. Cost Sharing for Outpatient SUD Treatment in Large Group Policies and Contracts
Chapter 57 of 2019 added new Insurance Law §§ 3221(l)(7)(C-1) and 4303(l)((3-a), which prohibit a large group policy or contract from imposing copayments or coinsurance for outpatient SUD services that exceed the copayment or coinsurance imposed for a primary care office visit. It further provides that a large group policy or contract may impose no greater than one copayment for all services provided in a single day by a facility licensed, certified, or otherwise authorized by OASAS to provide outpatient SUD services. Please see the frequently asked questions posted on the Department of Financial Service’s (“DFS’s”) website for a further discussion regarding the implementation of this requirement.
F. Definition of a SUD
Chapter 57 of 2019 added Insurance Law §§ 3216(i)(30)(F)(iv), 3216(i)(31)(G)(iv), 3221(l)(6)(F)(iv), 3221(l)(7)(G)(iv), 4303(k)(6)(D), and 4303(l)(7)(D), which provide that “substance use disorder” shall have the same meaning set forth in the most recent edition of the Diagnostic and Statistical Manual of Mental Disorders (“DSM”) or the most recent edition of another generally recognized independent standard of current medical practice, such as the International Classification of Diseases (“ICD”).
III. Mental Health Conditions
A. Clinical Review Criteria for Utilization Review
Chapter 57 of 2019 added a new provision to the utilization review program standards section in Articles 49 of the Insurance Law and the Public Health Law, which applies to issuers and independent agents performing utilization review under contract with such issuers (collectively, “UR agents”). The new provision sets forth standards that UR agents must consider when deciding what criteria, including medical necessity and level of care criteria, to use to determine health care coverage for treatment of mental health conditions. It requires UR agents who are reviewing mental health treatment for purposes of health insurance coverage to use evidence-based and peer-reviewed clinical review criteria that are appropriate to the patient’s age and are deemed appropriate and approved by the Commissioner of the Office of Mental Health (“OMH”), in consultation with the Commissioner of Health and the Superintendent of Financial Services.
UR agents should submit to OMH, DFS, and the Department of Health (“DOH”) the name and publisher, if available, of the clinical review criteria that the UR agent intends to use in accordance with guidance issued by OMH. UR agents using their own proprietary clinical review criteria should so indicate. In addition, within that same timeframe, UR agents should submit the actual clinical review criteria to OMH. The clinical review criteria must be recognized as evidence-based and peer-reviewed and the criteria must be appropriate to the ages of the patients to whom they are intended to apply. UR agent submissions should include all policies and procedures regarding the application of such clinical review criteria, including criteria for triggering utilization review, a description of the required training on such criteria for staff making level of care determinations, and a description of how inter-rater reliability will be ensured.
When UR agents are making coverage determinations related to treatment of mental health conditions for adults, OMH strongly encourages them to use the most recent version of the Level of Care Utilization System for Psychiatric and Addiction Services (“LOCUS”) tool, which is currently Version 20. When making coverage determinations related to treatment of mental health conditions for children and adolescents, OMH strongly encourages UR agents to use the most recent version of the Child and Adolescent Level of Care Utilization System for Psychiatric and Addiction Services (“CALOCUS”) tool, which is currently Version 2010. While OMH strongly encourages UR agents to use LOCUS and CALOCUS for mental health treatment coverage determinations, the benefits covered will depend on the terms of the individual’s insurance policy or contract.
UR agents who use LOCUS and CALOCUS will not be required to demonstrate to OMH that the criteria are recognized as evidence-based, peer-reviewed, and appropriate to the ages of the patients to whom they are intended to apply. However, the submissions should still include all policies and procedures regarding the application of such clinical review criteria. OMH will prioritize and expedite its review of submissions for UR agents who use LOCUS and CALOCUS.
OMH, in consultation with DFS and DOH, has published additional expectations and guiding principles that will be used to assess the adequacy of UR agents’ clinical review criteria for the treatment of mental health conditions. The guiding principles include expectations regarding parity compliance in the application of clinical review criteria and stress support for quality improvement approaches to utilization review that are comparable to and applied no more stringently to mental health services than they are to medical or surgical conditions.
UR agents that seek to alter their clinical review criteria after obtaining approval should submit notice of the proposed change or changes and effective date to OMH, DFS, and DOH and the actual criteria to OMH no later than 60 days before the date that they intend to use the criteria.
Chapter 57 of the Laws of 2019 requires that clinical review criteria have inter-rater reliability testing completed by December 31, 2019.
B. Mental Health Benefits Amended for Compliance with the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (“MHPAEA”)
Chapter 57 of 2019 added Insurance Law § 3216(i)(35), which requires every policy delivered or issued for delivery in New York that provides coverage for inpatient hospital care to provide benefits for inpatient hospital care in a hospital as defined in Mental Hygiene Law § 1.03(10) and benefits for outpatient care provided in a facility issued an operating certificate by OMH pursuant to the provisions of Mental Hygiene Law Article 31 or, for care in other states, to similarly licensed or certified hospitals or facilities. Chapter 57 of 2019 also requires every policy delivered or issued for delivery in New York that provides coverage for physician services to provide benefits for outpatient care provided by a psychiatrist or psychologist licensed to practice in this state, a licensed clinical social worker who meets the requirements of the Insurance Law, a nurse practitioner licensed to practice in New York, or a professional corporation or university faculty practice corporation thereof. With the addition of § 3216(i)(35), the Insurance Law treats coverage for mental health conditions consistently across all types of insurers and markets. It also ensures that the Insurance Law accurately reflects what was already required to be covered pursuant to MHPAEA.
Chapter 57 of 2019 also amended Insurance Law §§ 3221(l)(5) and 4303(g) by deleting the day and visit limits and the distinction between biologically-based mental health conditions and all other mental health conditions that was not permissible due to MHPAEA. Further, it amended the Insurance Law provisions related to coverage of mental health conditions to add language that provides that such coverage may not apply financial requirements or treatment limitations that are more restrictive than the predominant financial requirements and treatment limitations that apply to substantially all medical and surgical benefits covered by the policy or contract and to require that coverage be provided, at a minimum, consistent with MHPAEA.
C. Prohibition Against Preauthorization and Concurrent Review During First 14 Days of an Inpatient Admission for a Mental Health Condition for Individuals Under 18
Chapter 57 of 2019 added Insurance Law §§ 3216(i)(35)(G), 3221(l)(5)(G), and 4303(g)(8), which prohibit an issuer from requiring preauthorization or performing concurrent review during the first 14 days of an inpatient admission for the treatment of a mental health condition of an individual under the age of 18. The prohibitions apply when the treatment occurs in a facility that is licensed by OMH and participates in the issuer’s provider network and, with respect to the concurrent review prohibition, provided that the facility notifies the issuer of both the admission and the initial treatment plan within two business days of the admission, performs daily clinical review of the patient, and participates in periodic consultation with the issuer to ensure that the facility is using the evidence-based and peer-reviewed clinical review criteria used by the issuer, which are approved by OMH and appropriate to the patient’s age, to ensure that the inpatient care is medically necessary for the patient. If the care is denied retrospectively, the insured will not have any financial obligation to the facility for the treatment other than any copayment, coinsurance, or deductible otherwise required under the policy or contract.
D. Clinical Peer Reviewer
Chapter 57 of 2019 amended the definition of clinical peer reviewer in Articles 49 of the Insurance Law and Public Health Law by providing that, when performing utilization review for mental health treatment, the clinical peer reviewer must be a physician who possesses a current and valid non-restricted license to practice medicine and has experience in the delivery of mental health courses of treatment, or a health care professional other than a licensed physician who specializes in behavioral health and has experience in the delivery of mental health courses of treatment and, where applicable, possesses a current and valid non-restricted license, certificate, or registration or, where no license, certificate, or registration exists, is credentialed by the national accrediting body appropriate to the profession.
DFS expects clinical peer reviewers to have professional, clinical experience relevant to the mental health treatment that they are reviewing. For example, a best practice would be for a clinical peer reviewer making determinations regarding mental health treatment for children to have professional, clinical experience providing mental health services to children. DFS also encourages issuers to ensure that utilization review is performed on a peer-to-peer basis to the greatest extent practicable.
E. Nurse Practitioners
Chapter 57 of 2019 requires issuers to provide benefits for outpatient treatment of mental health conditions when provided by a nurse practitioner licensed to practice in New York.
F. Cost-Sharing for Outpatient Mental Health Services
Chapter 57 of 2019 amended Insurance Law §§ 3221(l)(5)(B) and 4303(g)(3) by providing that an issuer may not impose a copayment or coinsurance for outpatient mental health services provided in a facility licensed, certified, or otherwise authorized by OMH that exceeds the copayment or coinsurance imposed for a primary care office visit under the policy or contract. Please see the frequently asked questions posted on DFS’s website for a further discussion regarding the implementation of this requirement.
G. Definition of Mental Health Condition
Chapter 57 of 2019 added Insurance Law §§ 3216(i)(35)(E)(iv), 3221(l)(5)(E)(iv), and 4303(g)(6)(D), which define “mental health condition” as any mental health disorder as defined in the most recent edition of the DSM or the most recent edition of another generally recognized independent standard of current medical practice, such as the ICD.
IV. Disclosure Requirements
A. Participating Provider Directory
Chapter 57 of 2019 amended Insurance Law §§ 3217-a(a)(17) and 4324(a)(17) and Public Health Law § 4408(1)(r) by requiring an issuer’s participating provider directory to indicate whether the provider is accepting new patients and, for behavioral health providers, any affiliations with participating facilities certified or authorized by OMH or OASAS and any restrictions regarding the availability of the individual provider’s services.
B. MHPAEA Comparative Analysis
Chapter 57 of 2019 added new Insurance Law §§ 3217-a(a)(21) and 4324(a)(22) and Public Health Law § 4408(1)(v), which require an issuer to supply each insured, and upon request each prospective insured, prior to enrollment, the most recent comparative analysis performed by the corporation to assess the provision of its covered services in accordance with MHPAEA and any amendment, federal guidance, or regulations issued pursuant to MHPAEA.
V. Conclusion
DFS intends to investigate issuers’ compliance with the requirements for coverage of mental health and SUD treatment described in this circular letter, including during market conduct examinations. DFS will take action against an issuer for any failure to adhere to any statutory and regulatory requirements for mental health and SUD treatment.
Please direct any questions regarding this circular letter by mail to Thomas Fusco, Supervising Insurance Attorney, Health Bureau, New York State Department of Financial Services, Walter J. Mahoney Office Building, 65 Court Street, Room 7, Buffalo, New York 14202 or by e-mail to [email protected].
Very truly yours,
Lisette Johnson
Bureau Chief, Health Bureau