CHA News

DMHC Issues All Plan Letter on Compliance with Mental Health and Substance Use Parity Law

For CEOs, CFOs, directors of reimbursement

This post has been archived and contains information that may be out of date.

On Jan. 5, the Department of Managed Health Care (DMHC) issued All Plan Letter (APL) 21-002 to all commercial full-service health plans and specialized health plans offering behavioral health services that are regulated by the department. The guidance is designed to ensure health plans comply with amendments made to Senate Bill (SB) 855 (Wiener, D-San Francisco), the mental health and substance use parity law that took effect on Jan. 1.   

SB 855 requires commercial health plans and insurers to provide full coverage for the treatment of all mental health conditions and substance use disorders. It also establishes specific standards for what constitutes medically necessary treatment and criteria for the use of clinical guidelines. The APL outlines filing and compliance requirements of plans, including revised policies and procedures to accommodate new coverage requirements and implementation procedures related to utilization review of covered benefits. 

In addition, the 2020-21 state budget approved strategies to strengthen enforcement of behavioral health parity laws, including focused investigations of commercial health plans regulated by DMHC. These investigations, which are expected to begin in the first quarter of 2021, will help DMHC further evaluate health plan compliance with parity and assess whether enrollees have consistent access to medically necessary behavioral health care services.