EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0684*
SENATE BILL 684
J5 4lr2261
CF 4lr2870
By: Senator Augustine
Introduced and read first time: January 29, 2024
Assigned to: Finance
A BILL ENTITLED
AN ACT concerning 1
Health Insurance – Mental Health and Substance Use Disorder Benefits – 2
Sunset Repeal and Modification of Reporting Requirements 3
FOR the purpose of altering certain reporting requirements on health insurance carriers 4
relating to compliance with the federal Mental Health Parity and Addiction Equity 5
Act; altering requirements for certain analyses of nonquantitative treatment 6
limitations required of health insurance carriers; authorizing the Maryland 7
Insurance Commissioner to exercise discretion to review subsets of nonquantitative 8
treatment limitations under certain circumstances; establishing certain remedies 9
the Commissioner may use to enforce compliance with the Mental Health Parity and 10
Addiction Equity Act and related reporting requirements; establishing that a health 11
insurance carrier has the burden of persuasion in demonstrating that its health plan 12
complies with the federal Mental Health Parity and Addiction Equity Act; repealing 13
the termination date for the reporting requirements; and generally relating to health 14
insurance carriers and mental health and substance use disorder benefits. 15
BY repealing and reenacting, with amendments, 16
Article – Insurance 17
Section 15–144 18
Annotated Code of Maryland 19
(2017 Replacement Volume and 2023 Supplement) 20
BY repealing and reenacting, with amendments, 21
Chapter 211 of the Acts of the General Assembly of 2020 22
Section 4 23
BY repealing and reenacting, with amendments, 24
Chapter 212 of the Acts of the General Assembly of 2020 25
Section 4 26
2 SENATE BILL 684
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
That the Laws of Maryland read as follows: 2
Article – Insurance 3
15–144. 4
(a) (1) In this section the following words have the meanings indicated. 5
(2) “Carrier” means: 6
(i) an insurer that holds a certificate of authority in the State and 7
provides health insurance in the State; 8
(ii) a health maintenance organization that is licensed to operate in 9
the State; 10
(iii) a nonprofit health service plan that is licensed to operate in the 11
State; or 12
(iv) any other person or organization that provides health benefit 13
plans subject to State insurance regulation. 14
(3) “Health benefit plan” means: 15
(i) for a large group or blanket plan, a health benefit plan as defined 16
in § 15–1401 of this title; 17
(ii) for a small group plan, a health benefit plan as defined in § 18
15–1201 of this title; 19
(iii) for an individual plan: 20
1. a health benefit plan as defined in § 15–1301(l) of this title; 21
or 22
2. an individual health benefit plan as defined in § 23
15–1301(o) of this title; 24
(iv) short–term limited duration insurance as defined in § 15–1301(s) 25
of this title; or 26
(v) a student health plan as defined in § 15–1318(a) of this title. 27
(4) “Medical/surgical benefits” has the meaning stated in 45 C.F.R. § 28
146.136(a) and 29 C.F.R. § 2590.712(a). 29
SENATE BILL 684 3
(5) “Mental health benefits” has the meaning stated in 45 C.F.R. § 1
146.136(a) and 29 C.F.R. § 2590.712(a). 2
(6) “Nonquantitative treatment limitation” means treatment limitations 3
as defined in 45 C.F.R. § 146.136(a) and 29 C.F.R. § 2590.712(a). 4
(7) (I) “Parity Act” means the Paul Wellstone and Pete Domenici 5
Mental Health Parity and Addiction Equity Act of 2008 [and 45 C.F.R. § 146.136 and 29 6
C.F.R. § 2590.712], AS AMENDED . 7
(II) “PARITY ACT” INCLUDES 45 C.F.R. § 146.136, 29 C.F.R. § 8
2590.712, AND ANY OTHER RELATE D FEDERAL REGULATION S FOUND IN THE CODE 9
OF FEDERAL REGULATIONS TO IMPLEMENT OR ENFORCE THE PAUL WELLSTONE 10
AND PETE DOMENICI MENTAL HEALTH PARITY AND ADDICTION EQUITY ACT OF 11
2008. 12
(8) “Parity Act classification” means: 13
(i) inpatient in–network benefits; 14
(ii) inpatient out–of–network benefits; 15
(iii) outpatient in–network benefits; 16
(iv) outpatient out–of–network benefits; 17
(v) prescription drug benefits; and 18
(vi) emergency care benefits. 19
(9) “Substance use disorder benefits” has the meaning stated in 45 C.F.R. 20
§ 146.136(a) and 29 C.F.R. § 2590.712(a). 21
(b) This section applies to a carrier that delivers or issues for delivery a health 22
benefit plan in the State. 23
(c) (1) On or before [March 1, 2022, and March 1, 2024] MARCH 1 EACH 24
YEAR, BEGINNING IN 2025, each carrier subject to this section shall: 25
(i) identify the five health benefit plans with the highest enrollment 26
for each product offered by the carrier in the individual, small, and large group markets; 27
and 28
(ii) submit a report to the Commissioner to demonstrate the carrier’s 29
compliance with the Parity Act. 30
4 SENATE BILL 684
(2) The report submitted under paragraph (1) of this subsection shall 1
include [the following information] ALL NONQUANTITATIVE TREATMENT LIMITATION 2
COMPARATIVE ANALYSIS INFORMATION REQUIRED UNDER THE PARITY ACT, 3
SUBSECTION (D) OF THIS SECTION , AND ANY STATE REGULATIONS for the health 4
benefit plans identified under [item] PARAGRAPH (1)(i) of this subsection, INCLUDING: 5
(i) a description of the process used to develop or select the medical 6
necessity criteria for mental health benefits and substance use disorder benefits and the 7
process used to develop or select the medical necessity criteria for medical and surgical 8
benefits; 9
(ii) for each Parity Act classification, identification of 10
nonquantitative treatment limitations that are applied to mental health benefits and 11
substance use disorder benefits and medical and surgical benefits; 12
(iii) identification of the description of the nonquantitative treatment 13
limitations identified under item (ii) of this paragraph in documents and instruments under 14
which the plan is established or operated; and 15
(iv) the results of the comparative analysis as described under 16
subsections (d) and (e) of this section. 17
(d) (1) A carrier subject to this section shall conduct a comparative analysis 18
for the nonquantitative treatment limitations identified under subsection (c)(2)(ii) of this 19
section as nonquantitative treatment limitations are: 20
(i) written; and 21
(ii) in operation. 22
(2) The comparative analysis of the nonquantitative treatment limitations 23
identified under subsection (c)(2)(ii) of this section shall: 24
(I) demonstrate that the processes, strategies, evidentiary 25
standards, or other factors used in applying the medical necessity criteria and each 26
nonquantitative treatment limitation to mental health benefits and substance use disorder 27
benefits in each Parity Act classification are comparable to, and are applied no more 28
stringently than, the processes, strategies, evidentiary standards, or other factors used in 29
applying the medical necessity criteria and each nonquantitative treatment limitation to 30
medical and surgical benefits within the same Parity Act classification; AND 31
(II) INCLUDE ALL INFORMAT ION REQUIRED UNDER THE PARITY 32
ACT. 33
(e) In providing the analysis required under subsection (d) of this section, a 34
carrier shall: 35 SENATE BILL 684 5
(1) identify the factors used to determine that a nonquantitative treatment 1
limitation will apply to a benefit, including: 2
(i) the sources for the factors, INCLUDING SOURCES IN EFFECT 3
BEFORE THE ENACTMENT OF THE PARITY ACT; 4
(ii) the factors that were considered but rejected; [and] 5
(III) THE FACTORS THAT WER E IN EFFECT BEFORE T HE 6
ENACTMENT OF THE PARITY ACT AND ARE USED IN THE DESI GN OR APPLICATION 7
OF THE NONQUANTITATI VE TREATMENT LIMITAT ION; AND 8
[(iii)] (IV) if a factor was given more weight than another, the reason 9
for the difference in weighting; 10
(2) identify and define the specific evidentiary standards used to define the 11
factors and any other evidence relied on in designing each nonquantitative treatment 12
limitation, INCLUDING EVIDENTIAR Y STANDARDS IN EFFEC T BEFORE THE 13
ENACTMENT OF THE PARITY ACT; 14
(3) IDENTIFY AND DEFINE THE PROCESSES AND ST RATEGIES THAT 15
ARE USED TO DESIGN O R APPLY THE NONQUANT ITATIVE TREATMENT LI MITATION, 16
INCLUDING THE PROCESSES AND STRATE GIES IN EFFECT BEFORE THE ENACTMENT 17
OF THE PARITY ACT; 18
[(3)] (4) include the results of the audits, reviews, and analyses 19
performed on the nonquantitative treatment limitations identified under subsection 20
(c)(2)(ii) of this section to conduct the analysis required under subsection (d)(2) of this 21
section for the plans as written; 22
[(4)] (5) include the results of the audits, reviews, and analyses 23
performed on the nonquantitative treatment limitations identified under subsection 24
(c)(2)(ii) of this section to conduct the analysis required under subsection (d)(2) of this 25
section for the plans as in operation; 26
[(5)] (6) identify the measures used to ensure comparable design and 27
application of nonquantitative treatment limitations that are implemented by the carrier 28
and any entity delegated by the carrier to manage mental health benefits, substance use 29
disorder benefits, or medical/surgical benefits on behalf of the carrier; 30
[(6)] (7) disclose the specific findings and conclusions reached by the 31
carrier that indicate that the health benefit plan is in compliance with this section and the 32
Parity Act [and its implementing regulations, including 45 C.F.R. 146.136 and 29 C.F.R. 33 6 SENATE BILL 684
2590.712 and any other related federal regulations found in the Code of Federal 1
Regulations]; and 2
[(7)] (8) identify the process used to comply with the Parity Act disclosure 3
requirements for mental health benefits, substance use disorder benefits, and 4
medical/surgical benefits, including: 5
(i) the criteria for a medical necessity determination; 6
(ii) reasons for a denial of benefits; and 7
(iii) in connection with a member’s request for group plan 8
information and for purposes of filing an internal coverage or grievance matter and appeals, 9
plan documents that contain information about processes, strategies, evidentiary 10
standards, and any other factors used to apply a nonquantitative treatment limitation. 11
(f) On or before [March 1, 2022, and March 1, 2024] MARCH 1 EACH YEAR, 12
BEGINNING IN 2025, each carrier subject to this section shall submit a report for the 13
health benefit plans identified under subsection (c)(1)(i) of this section to the Commissioner 14
on the following data for the immediately preceding calendar year for mental health 15
benefits, substance use disorder benefits, and medical/surgical benefits by Parity Act 16
classification: 17
(1) the frequency, reported by number and rate, with which the health 18
benefit plan received, approved, and denied prior authorization requests for mental health 19
benefits, substance use disorder benefits, and medical and surgical benefits in each Parity 20
Act classification during the immediately preceding calendar year; [and] 21
(2) the number of claims submitted for mental health benefits, substance 22
use disorder benefits, and medical and surgical benefits in each Parity Act classification 23
during the immediately preceding calendar year and the number and rates of, and reasons 24
for, denial of claims; AND 25
(3) DATA IDENTIFIED BY THE COMMISSIONER OR FEDER AL 26
REGULATIONS TO EVALU ATE NONQUANTITATIVE TREATMENT LIMITATION 27
COMPLIANCE WITH THE IN–OPERATION STANDARD O F THE PARITY ACT. 28
(g) The reports required under subsections (c) and (f) of this section shall: 29
(1) be submitted on a standard form developed by the Commissioner THAT 30
CONFORMS TO THE FEDE RAL REGULATIONS ON NONQU ANTITATIVE TREATMENT 31
LIMITATIONS COMPARAT IVE ANALYSIS REPORTI NG; 32
(2) be submitted by the carrier that issues or delivers the health benefit 33
plan; 34
SENATE BILL 684 7
(3) be prepared in coordination with any entity the carrier contracts with 1
to provide mental health benefits and substance use disorder benefits; 2
(4) contain a statement, signed by a corporate officer, attesting to the 3
accuracy of the information contained in the report; 4
(5) be available to plan members and the public on the carrier’s website in 5
a summary form that removes confidential or proprietary information and is developed by 6
the Commissioner in accordance with subsection [(m)(2)] (N)(2) of this section; and 7
(6) exclude any identifying information of any plan member. 8
(h) (1) A carrier submitting a report under subsections (c) and (f) of this section 9
may submit a written request to the Commissioner that disclosure of specific information 10
included in the report be denied under the Public Information Act and, if submitting a 11
request, shall: 12
(i) identify the particular information the disclosure of which the 13
carrier requests be denied; and 14
(ii) cite the statutory authority under the Public Information Act 15
that authorizes denial of access to the information. 16
(2) The Commissioner may review a request submitted under paragraph 17
(1) of this subsection on receipt of a request for access to the information under the Public 18
Information Act. 19
(3) The Commissioner may notify the carrier that submitted the request 20
under paragraph (1) of this subsection before granting access to information that was the 21
subject of the request. 22
(4) A carrier shall disclose to a member on request any plan information 23
contained in a report that is required to be disclosed to that member under federal or State 24
law. 25
(i) (1) The Commissioner shall: 26
[(1)] (I) review each report submitted in accordance with subsections (c) 27
and (f) of this section to assess each carrier’s compliance with the Parity Act; 28
[(2)] (II) notify a carrier in writing of any noncompliance with the Parity 29
Act before issuing an administrative order; and 30
[(3)] (III) within 90 days after the notice of noncompliance is issued, allow 31
the carrier to: 32
8 SENATE BILL 684
[(i)] 1. submit a compliance plan to the Administration to comply 1
with the Parity Act; and 2
[(ii)] 2. reprocess any claims that were improperly denied, in 3
whole or in part, because of the noncompliance. 4
(2) THE COMMISSIONER MAY EXER CISE DISCRETION TO R EVIEW A 5
SUBSET OF NONQUANTIT ATIVE TREATMENT LIMI TATIONS FOR THE PURPOSES OF 6
THIS SECTION IF THE COMMISSIONER : 7
(I) AFTER THE REPORTING DEADLINES ESTABLISHE D UNDER 8
SUBSECTION S (C) AND (F) OF THIS SECTION , IDENTIFIES THE NON QUANTITATIVE 9
TREATMENT LIMITATION S THAT WILL BE REVIE WED BY THE COMMISSIONER ; 10
(II) DESCRIBES AND POSTS ON THE ADMINISTRATION ’S 11
WEBSITE THE CRITERIA USED TO IDENTIFY THE NONQUANTITATIVE TREA TMENT 12
LIMITATIONS THAT WIL L BE REVIEWED EACH Y EAR; 13
(III) REVIEWS NONQUANTITAT IVE TREATMENT LIMITA TIONS 14
THAT HAVE THE GREATE ST EFFECT ON ACCESS TO MENTAL HEALTH AND 15
SUBSTANCE USE DISORD ER CARE; 16
(IV) REVIEWS THE SAME SUB SET OF NONQUANTITATI VE 17
TREATMENT LIMITATION S FOR EACH CARRIER R EPORT; 18
(V) REVIEWS NO T LESS THAN 10 NONQUANTITATIVE 19
TREATMENT LIMITATION S FOR EACH CARRIER R EPORT; AND 20
(VI) ISSUES A DETERMINATION IN ANY MATTER THAT 21
IMPLICATES PARITY ACT COMPLIANCE REGARD LESS OF WHETHER A 22
NONQUANTITATIVE TREA TMENT LIMITATION AT ISSUE IN THE MA TTER HAS BEEN 23
REVIEWED UNDER THIS SECTION. 24
(j) If the Commissioner finds that the carrier failed to submit a complete report 25
required under subsection (c) or (f) of this section, the Commissioner may impose any 26
penalty or take any action as authorized: 27
(1) for an insurer, nonprofit health service plan, or any other person subject 28
to this section, under this article; or 29
(2) for a health maintenance organization, under this article or the Health 30
– General Article. 31
SENATE BILL 684 9
(k) If, as a result of the review required under subsection [(i)(1)] (I)(1)(I) of this 1
section, the Commissioner finds that the carrier failed to comply with [the provisions of] 2
the Parity Act, [and] did not submit a compliance plan to adequately correct the 3
noncompliance, OR FAILED TO SUBMIT INFORMATION THAT IS REQUIRED TO 4
EVALUATE COMPLIANCE WITH THE PARITY ACT, the Commissioner may: 5
(1) issue an administrative order that requires: 6
(i) the carrier or an entity delegated by the carrier to cease the 7
noncompliant conduct or practice; [or] 8
(II) THE CARRIER OR AN ENTITY DELEGATED BY THE CARRIER 9
TO CEASE THE IMPLEMENTATION OF TH E NONQUANTITATIVE TREA TMENT 10
LIMITATION; OR 11
[(ii)] (III) the carrier to provide a payment that has been denied 12
improperly because of the noncompliance, INCLUDING A FAILURE TO PROVIDE 13
INFORMATION THAT DEM ONSTRATES COMPLIANCE ; [or] 14
(2) IMPOSE A PENALTY O F NOT LESS THAN $1,000 FOR EACH DAY IN 15
WHICH THE CARRIER FA ILS TO SUBMIT INFORM ATION REQUIRED BY TH E 16
COMMISSIONER TO EVALU ATE COMPLIANCE ; OR 17
[(2)] (3) impose any OTHER penalty or take any action as authorized: 18
(i) for an insurer, nonprofit health service plan, or any other person 19
subject to this section, under this article; or 20
(ii) for a health maintenance organization, under this article or the 21
Health – General Article. 22
(L) (1) A CARRIER SHALL HAVE T HE BURDEN OF PERSUAS ION IN 23
DEMONSTRATING T HAT ITS HEALTH PLAN COMPLIES WITH THE PARITY ACT: 24
(I) IN ANY REVIEW CONDUC TED BY THE COMMISSIONER 25
UNDER THIS SECTION ; OR 26
(II) IN ANY MATTER FILED WITH THE COMMISSIONER THAT 27
INVOLVES THE APPLICA TION OF THE PARITY ACT. 28
(2) A FAILURE OF A CARRIER TO SUBMIT COMPLETE PARITY ACT 29
COMPLIANCE INFORMATI ON REQUIRED UNDER THIS SECTION OR IN C ONNECTION 30
WITH A MATTER FILED WITH THE COMMISSIONER SHALL CO NSTITUTE 31
NONCOMPLIANCE WITH T HE PARITY ACT. 32 10 SENATE BILL 684
[(l)] (M) In determining an appropriate penalty under subsection (j) or (k) of this 1
section, the Commissioner shall consider the late filing of a report required under 2
subsection (c) or (f) of this section and any parity violation to be a serious violation with a 3
significantly deleterious effect on the public. 4
[(m)] (N) On or before December 31, 2021, the Commissioner shall create: 5
(1) a standard form for entities to submit the reports in accordance with 6
subsection (g)(1) of this section; and 7
(2) a summary form for entities to post to their websites in accordance with 8
subsection (g)(5) of this section. 9
[(n)] (O) On or before December 31, [2021] 2024, the Commissioner shall, in 10
consultation with interested stakeholders, adopt regulations to implement this section, 11
including to ensure uniform definitions and methodology for the reporting requirements 12
established under this section. 13
Chapter 211 of the Acts of 2020 14
SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall take effect 15
October 1, 2020. [It shall remain in effect for a period of 6 years and, at the end of 16
September 30, 2026, this Act, with no further action required by the General Assembly, 17
shall be abrogated and of no further force and effect.] 18
Chapter 212 of the Acts of 2020 19
SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall take effect 20
October 1, 2020. [It shall remain in effect for a period of 6 years and, at the end of 21
September 30, 2026, this Act, with no further action required by the General Assembly, 22
shall be abrogated and of no further force and effect.] 23
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 24
1, 2024. 25