A final federal rule brings behavioral health parity to Medicaid managed care and the Children’s Health Insurance Plan – a move that earned an initial thumbs-up from the American Psychiatric Association.

The Centers for Medicare & Medicaid Services issued a final rule March 30 that extends to Medicaid and CHIP certain aspects of the of the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act . That 2008 law requires private health insurance to cover mental health and substance abuse treatments as they do medical and surgical services.

“Many of our recommendations to the proposed rule were adopted, and our preliminary analysis does not indicate any major disappointments,” APA President Renée Binder said in an interview. “There were considerable health plan industry pressures to dilute the essential features of the parity rule, but their approach was not adopted by CMS. The end result is that Medicaid patients will enjoy the same protections under the parity law that commercially insured patients get.”

The final rule , published in the Federal Register, subjects Medicaid managed care organizations, states that offer Medicaid alternative benefit plans, and all CHIP programs to the same financial treatment and limitations consistent with regulations applied to private insurers in that state. It does not apply to fee-for-service Medicaid.

In addition, in contrast to the proposed rule, “this final rule also extends parity protections to apply to long-term care services for mental health and substance abuse disorders in the same manner as they are applied to other services,” the agency noted in a fact sheet issued March 29.

The new rule will be effective in getting treatment for Medicaid and CHIP patients, the APA’s Dr. Binder predicted.

“The prevalence of these conditions is significant and costly,” she said. “Setting requirements that level the playing field for managing access to mental health and substance use disorder services will remove discriminatory entry barriers to treatment for these beneficiaries.”

When plans do restrict access, the rule directs plans to make reasons for denial of reimbursement or payment for services available to enrollees.

The rule “seemingly closed any possible loopholes or workarounds to the parity requirements,” Dr. Binder noted. “Given the often-complex managed care arrangements states have to provide these benefits, this is a significant achievement.”

Indeed, CMS rejected a request for more liberal use of prior authorization. The rule highlights a specific request for plans to be able to require prior authorization to move patients from emergency departments to inpatient care.

“The factors used to determine whether and when the use of prior authorization is appropriate must be comparable and applied no more stringently for [mental health/substance use disorder] benefits than they are for medical/surgical conditions,” CMS stated.