The Departments of Labor ("DOL"), Health and Human Services ("HHS"), and Treasury (the "Tri-Agencies") have signaled that changes may be coming to the Mental Health Parity and Addiction Equity Act ("MHPAEA") Final Rule issued on September 8, 2024. On May 9, 2025, the Tri-Agencies filed a Motion for Abeyance in a lawsuit brought by the ERISA Industry Committee ("ERIC") challenging the 2024 final MHPAEA regulations in the United States District Court for the District of Columbia.1 The Motion, which was granted by the Court, indicated that the Tri-Agencies intend to "reconsider" the Final Rule, including "whether to issue a notice of proposed rulemaking rescinding or modifying the Final Rule." Yesterday, on May 15, 2025, the Tri-Agencies issued a notice of non-enforcement stating that they "will not enforce the 2024 Final Rule or otherwise pursue enforcement actions, based on a failure to comply that occurs prior to a final decision in the litigation, plus an additional 18 months."
MHPAEA requires that health plans apply treatment limitations, including non-quantitative treatment limitations ("NQTLs"), to mental health and substance use disorder benefits in parity with how they apply them to medical and surgical benefits. Last August, the Tri-Agencies issued long-awaited regulations detailing the Tri-Agencies' expectations for the comparative analyses used to assess comparability for NQTLs. The Final Rule included new regulations pertaining to the content of comparative analyses, the evaluation of outcomes data, prohibitions on discriminatory factors and evidentiary standards, requirements for "meaningful benefits" and the effects of non-compliance. The Final Rule was met by criticism, and ERIC filed a lawsuit in the United States District Court for the District of Columbia challenging the validity of the Final Rule. ERIC, a national nonprofit trade association advocating on behalf of large employers, asserted that several of the requirements go beyond the Tri-Agencies' mandate under MHPAEA and/or fail to comply with the Administrative Procedures Act.
In the Motion for Abeyance filed last week, the Tri-Agencies asked the court to stay the lawsuit while they reconsider the Final Rule. The Tri-Agencies noted that they intended to issue a non-enforcement policy with respect to the 2024 Final Rule. They also said that they would reexamine the Tri-Agencies' current enforcement program more broadly and proposed to update the court every 90 days. The Motion was granted on Tuesday.
Two days later, the Tri-Agencies issued the notice of non-enforcement, pausing enforcement of the Final Rule during the pendency of the litigation. As suggested in the Motion, the Tri-Agencies also noted that each will undertake "a broader reexamination of each department's respective enforcement approach under MHPAEA." HHS specifically encouraged states that are the primary enforcers of MHPAEA with respect to issuers to adopt a similar approach to enforcement.
The Motion and notice demonstrate that changes are likely to come to the regulations implementing MHPAEA, although it is unclear whether the Tri-Agencies will rescind the entirety of the Final Rule and whether the Tri-Agencies will issue new regulations. The notice makes clear that the 2013 regulations and MHPAEA statute (as amended by the Consolidated Appropriations Act, 2021) remain in effect. The Tri-Agencies specifically noted that each "remain[s] committed to ensuring that individuals receive protections under the law in a way that is not unduly burdensome for plans and issuers." Finally, while the Tri-Agencies encourage states to adopt a similar approach to enforcement, state enforcement action may not be directly impacted by this pause. States, many of which have adopted their own parity laws, may continue to investigate and enforce parity violations irrespective of changes at the federal level.
Footnote
1. The ERISA Industry Committee v. U.S. Dep't of Health and Human Services, Case No. 1:25-cv-00136 (D.D.C. 1/17/25).
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