Seyfarth Synopsis: On May 15, 2025 the Departments of Labor, Health and Human Services, and Treasury (the "Departments") announced they will temporarily not enforce their new standards published under the mental health parity Final Rule last fall. However, the earlier final rules and the statute itself remain in place and plan sponsors and fiduciaries should continue to prepare the comparative analyses required by the Consolidated Appropriations Act, 2021 ("CAA") and monitor their plan design for any limitations on mental health and substance use disorder benefits that may violate the Mental Health Parity and Addiction Equity Act ("MHPAEA").
Since the passage of the CAA, plan sponsors, administrators, and fiduciaries have agonized over how to comply with the requirement that medical and prescription drug plans perform and document a written analysis of their non-quantitative treatment limitations ("NQTLs"). In September 2024, the Biden administration published a Final Rule that added multiple complex and onerous content requirements to the NQTL comparative analysis, causing even more panic and uncertainty as many struggled to understand how to apply the rules and comply with the new regulations. In response to employer dissatisfaction with the new standards under the Final Rule, the ERISA Industry Committee ("ERIC") filed a lawsuit challenging the Final Rule on numerous grounds.
In connection with President Trump's Executive Order 14219, which directs federal agencies to review agency regulations that have unduly burdensome requirements and high costs for private parties and small businesses, the Departments issued a statement on May 15, 2025 announcing a policy of nonenforcement with respect to the Final Rule. Additionally, the Departments indicated they may issue a notice of proposed rulemaking either rescinding or modifying the Final Rule.
Importantly, while this non-enforcement policy is directed at the Final Rule, it does not apply to the underlying NQTL comparative analysis requirement itself, which is part of the original language in the CAA (although the Departments noted they will generally engage in a broad of review of the mental health parity provisions under the CAA). Further, it does not apply to the underlying parity rules under MHPAEA that have been in place over a decade, which require employers to ensure that the limits on mental health and substance use disorder benefits are no more restrictive than those applied to medical and surgical benefits (to the extent mental health benefits are covered). As such, plan sponsors, administrators, and fiduciaries should continue to work toward compliance with the NQTL comparative analysis requirement, keeping in mind that the complex content requirements added last year may be going by the wayside.
The non-enforcement relief would apply to several of the more onerous requirements under the final rule, however, most notably including:
- Meaningful Benefits Standard. The Final Rule would have required that plans provide "meaningful benefits" for mental health/substance use disorder benefits in any category where the plan provides medical/surgical benefits.
- Production of Comparative Analysis in Response to Participant Requests or in Connection to Claim for Benefits. The Final Rule would have required that ERISA plan sponsors produce a copy of the comparative analysis within 30 day of a participant request (essentially treating this analysis as an "operative plan document" for purposes of ERISA 104(b)(4)). Similarly, it would have required that all plans produce a copy of the comparative analysis in connection with a claim for mental health or substance use disorder benefits denied on the basis of an NQTL imposed by the plan.
- Fiduciary Certification. The Final Rule would have required that ERISA plan fiduciaries certify that they have engaged a "qualified service provider" to prepare the plan's comparative analysis.
Because these standards derive from the Final Rule, they should fall under the DOL's non-enforcement standard.
Notably, however, the DOL's non-enforcement standard does not protect plans from potential private enforcement action by plan participants. While courts may decline to enforce standards declared to be under review by the DOL, they would have the discretion to interpret applicability of these regulations to plans as they see fit. Moreover, the DOL and plan participants could continue to enforce/seek enforcement of the 2013 rules and the statutory requirements under the CAA.
Additionally, plan sponsors and fiduciaries should continue to review their plan design for potentially problematic limitations, paying particularly close attention to those limitations that have publicly been identified by the Departments as widespread problems.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
