A Hidden Legal Risk: A Review of Employer Obligations for Employees with Mental Illness
By: Marcas Miles and Irvin “Sam” Muszynski
For too long, mental health has remained in the shadows of our employer-led wellness efforts. The stigma associated with the topic remains a barrier, yet the effect of mental health conditions on business can no longer be denied. There are two reasons every company needs to be thinking about mental health in the workplace: 1) it’s the law to provide parity in care and 2) data proves it impacts your business.
The Case for Making Mental Health a Priority in Your Workplace
Mental health conditions impact a company more than most realize. Take depression for example. It is the leading cause of disability for people between 15 and 44 in the United States, resulting in nearly 400 million disability days per year, substantially more than most other physical and mental conditions. And depression’s impact on business is growing: the economic burden of individuals with Major Depressive Disorder (MDD) increased by 21.5 percent between 2005 and 2010 alone, and depression is anticipated to be the world’s leading cause of disease burden by 2030.
In addition, research continues to show that our focus on depression must extend to the full range of ways in which depression affects an individual, including their ability to perform effectively at work. The two hallmark signs of depression are deep feelings of sadness and loss of interest in activities that persists for weeks. There is increasing evidence that suggests that cognitive dysfunction, essential to work performance, is an underestimated dimension of depression.
A recent survey, The Impact of Depression at Work Audit (IDeA) (Ipsos, 2014), indicates depression negatively impacts employee performance. Results of the IDeA survey show that 64 percent of respondents with depression reported that cognitive-related challenges (defined as difficulty concentrating, indecisiveness and/or forgetfulness) had the greatest impact on their ability to perform tasks at work. Being at work but not engaged/productive, also known as “presenteeism,” has been found to be exacerbated by these cognitive-related challenges caused by depression. Additionally, according to the IDeA survey, two in five (40 percent) of those patients reported taking time off of work – an average of 10 days a year – as a result of their diagnosis.
The survey provides further evidence of the harmful impact of depression on the U.S. workforce. The results demonstrate the vital need for employers to provide support and resources in the workplace for those suffering from this debilitating disease.
So, if the number of people affected by depression is growing and we know that employees dealing with depression cannot maintain maximum productivity, a company’s ability to perform and compete is hindered. It’s time for change.
A Call for Change: Parity for Mental Health
Health plan benefits for mental health and substance use disorders have historically been more limited than those for medical/surgical benefits. The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) was passed to address this disparity. MHPAEA, also known as the ”mental health parity law,” is a federal law prohibiting private health insurance plans from discriminating against employees due to a mental illness, such as depression. Coverage for mental health concerns now must be equivalent to coverage for physical health problems, like heart disease, diabetes and cancer.1
It is important that employers understand the requirements associated with MHPAEA in order to be compliant with the federal law and avoid the significant financial penalties for noncompliance.
Current U.S. Legal Requirements to Address Mental Health in the Workplace
The MHPAEA outlines rights such as:
- Employees are entitled to the treatment deemed necessary by a physician to treat a mental health or substance use disorder. Insurance plans cannot require employees to fail first at a less expensive treatment if that is not a requirement for other illnesses in your plan.
- With few exceptions, an employee’s co-payment or co-insurance for mental health should not be higher than it is for other medical care. Employees should have only one deductible and out-of-pocket maximum for all health care received.
- If an employee visits a psychiatrist for medication management and psychotherapy on the same day, it should only be one co-payment.
- An employee should have access to an in-network mental health provider who is qualified to treat his or her condition and who can see the employee in a reasonable amount of time at a location accessible from the employee’s home.
- Pre-authorization to visit a mental health provider cannot be required, unless the insurance plan also requires pre-authorization for all other care.
For a complete list of requirements for the MHPAEA, please visit http://www.cms.gov. As plan sponsors, employers are subject to financial penalties for noncompliance with the parity law.
Don’t Make Assumptions; Ask Questions
Simply because you offer a top-notch insurance plan doesn’t mean you can ignore the parity law. It’s in employers’ interest to get engaged to understand how their plan is complying with the law. Here are some questions a plan sponsor can ask to find out more:
- Please explain the testing that was done to ensure that all applicable mental health/substance use disorder (MH/SUD) financial requirements and quantitative treatment limitations comply with the MHPAEA regulatory tests. Can you provide a summary analysis and the conclusions?
- Can you provide a list of the non-quantitative treatment limitations which MH/SUD benefits are subject to? Please provide the analysis that was undertaken to ensure compliance for each of these (including the medical necessity criteria for MH/SUD benefits) with the regulatory test for non-quantitative treatment limitations (NQTLs) and a summary of the basis for the conclusions that the tests are satisfied.
- How will the various disclosure obligations our plan has under MHPAEA and relevant claims regulations be discharged?
- Please provide a listing of the pertinent plan requirements respecting communication of benefit denials and samples of the transmittals you are planning to utilize to ensure our plan is in compliance.
There are also a number of resources available to employers:
- Employer Guide for Compliance with the Mental Health Parity and Addiction Equity Act: guidelines issued by Milliman at the request of the Partnership for Workplace Mental Health, a subsidiary of the American Psychiatric Association.
- The Department of Labor’s Employee Benefits Security Administration (EBSA) Frequently Asked Questions (FAQs) about MHPAEA implementation and self-compliance tool, providing relevant information on the final rules and how they are to be interpreted and applied.
- A free poster to help patients know their rights under the MHPAEA, developed by the American Psychiatric Association.
- Resources available to employers to address depression in the workplace, such as Right Direction, a free, first-of-its-kind initiative designed to promote early recognition of signs of depression and reduce the stigma in the workplace surrounding mental illness. Right Direction is an effort from the Partnership for Workplace Mental Health, a program of the American Psychiatric Foundation and Employers Health Coalition, Inc., and is supported by Takeda Pharmaceuticals U.S.A., Inc. (TPUSA) and Lundbeck U.S.
The MHPAEA exists to address the significant impact of mental health conditions on employees and ensure equivalent health coverage is available to those in need. By ensuring compliance with the law, employers will not only cover themselves legally and financially, but will ensure employees are getting the care they need.
1 Mental Health Parity. (n.d.). Retrieved March 10, 2015, from http://www.psychiatry.org/practice/parity
Marcas Miles, M.A.
Senior Director, Marketing & Communications, Employers Health
Marcas Miles is a senior communications, marketing and public relations professional with more than 16 years of progressive experience. He has spent most of his career in the health care and workforce development sectors. A national thought leader in addressing depression in the workplace and improving worker productivity, he has broad experience in assisting employers to leverage health benefits to improve cost, quality and accessibility of high-value health care services. He works to establish relationships with decision makers and other health care purchasers and influencers and has an excellent grasp of the challenges faced by today’s human resource and benefits professionals.
Irvin L. (Sam) Muszynski, J.D.
Director, Office of Healthcare Systems & Financing, American Psychiatric Association
Irvin L. “Sam” Muszynski serves as Director, Office of Healthcare Systems and Financing at the American Psychiatric Association, a professional membership association headquartered in Arlington, Virginia representing over 38,000 physicians. He is responsible for the association’s external activities regarding health insurance, reimbursement matters and formulary policy, including relations with the insurance and managed care industry, corporate purchasers of health care and Medicare/Medicaid reimbursement. Earlier in his career, he served as the association’s Director of the Office of Economic Affairs.
From 1986 to 1998, Sam was Manager of the Washington, D.C. office of Goldman, Marshall & Muszynski, a health care law firm, and Managing Director of the National Association of Addiction Treatment Providers, a trade association representing more than 450 specialty health care providers.
Sam received his B.S. and M.S.W. from the University of Illinois and his J.D. from George Mason University School of Law.