On May 15, 2025, three federal agencies—HHS, the US Department of the Treasury, and the US Department of Labor (the “Departments”)—issued a statement indicating that they are reconsidering the 2024 Mental Health Parity Regulations (2024 Final Regulations), including their possible rescission or modification (the Statement). The Departments issued the Statement in connection with litigation brought against the Departments challenging certain provisions of the 2024 Final Regulations. While the Statement suggests that interested parties—including health insurance carriers and third-party administrators, self-funded health plans, employers and other plans sponsors—may expect some relief from the 2024 Final Regulations’ more onerous requirements, for now the industry is left with an unclear picture of the current and future mental health parity landscape.
BACKGROUND
MHPAEA and 2013 Regulations
The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA)1 aims to prevent group health plans and health insurance issuers that provide mental health or substance use disorder (MH/SUD) benefits from imposing less favorable benefit limitations on those benefits than on medical/surgical benefits.2 Final regulations implementing MHPAEA were published in 2013 (2013 Final Regulations).
As relevant here, the 2013 Final Regulations provide that, if a group health plan provides MH/SUD benefits in any of six benefit classifications—(i) inpatient, in-network, (ii) inpatient, out-of-network, (iii) outpatient, in-network, (iv) outpatient, out-of-network, (v) emergency care, or (vi) prescription drugs (the Benefit Classifications)—then the plan must provide MH/SUD benefits in every Benefit Classification in which medical/surgical benefits are provided (the Benefits Parity Requirement).
The 2013 Final Regulations also prohibit a group health plan or health insurance issuer from imposing a nonquantitative treatment limitation (NQTL) on MH/SUD benefits in any Benefit Classification, unless the NQTL for the MH/SUD Benefits is applied in a manner that is “comparable to” and “no more stringent than” a NQTL imposed on medical/surgical benefits in the Benefits Classification (the NQTL Parity Requirement).3
To better ensure the NQTL Parity Requirement is met, Congress amended MHPAEA, via the Consolidated Appropriations Act of 2021 (CAA, 2021), to require plans and issuers that provide both medical/surgical benefits and MH/SUD benefits and that impose NQTLs on MH/SUD benefits to perform and document comparative analyses of the design and application of NQTLs and make that analysis available to the Departments (the Statutory Comparative Analysis Requirement).4 Following that amendment, the Departments published FAQs about the Statutory Comparative Analysis Requirement, which are still being used today as relevant sub-regulatory guidance.
2024 Regulations
Among other things, the 2024 Final Regulations amended the 2013 Final Regulations to specify how the Benefits Parity Requirement can be met. Specifically, the 2024 Final Regulations state that for a group health plan to satisfy the Benefits Parity Requirement, the plan must provide “meaningful benefits” for each covered MH/SUD condition. The 2024 Final Regulations specify that the only way a plan provides “meaningful benefits” for a covered MD/SUD condition is if the plan provides benefits for a “core treatment” for that MH/SUD condition in each Benefit Classification in which the plan provides a “core treatment” for one or more medical/surgical benefits.5
The 2024 Final Regulations also provide that plan fiduciaries of group health plans subject to the Employee Retirement Income Security Act of 1974 (ERISA) must certify that they have engaged in a prudent process to select a qualified service provider to perform and document the comparative analysis and have satisfied their duty to monitor those service providers as required under ERISA.
In addition to expanding upon the requirements in the 2013 Final Regulations, the 2024 Final Regulations also added requirements aimed at implementing the Statutory Comparative Analysis Requirement. For example, the 2024 Final Regulations specify the elements that plans must include in any NQTL comparative analysis.
Finally, the 2024 Final Regulations specify the content that plans must include in a notice to participants and beneficiaries in the event they are found to be out of compliance with the NQTL Parity Requirements.
ERISA INDUSTRY COMMITTEE CASE
In January 2025, the ERISA Industry Committee (ERIC),6 on behalf of approximately 100 large employers, sued the Departments, claiming that the 2024 Final Regulations overstepped the Departments’ authority, created vague and burdensome requirements that would increase costs and reduce the quality of care, and that parts of the rule were arbitrary and capricious and contrary to law. The complaint outlined certain components required by the 2024 Final Regulations, including the meaningful benefits requirement and plan fiduciary certification, and argued that they would “substantially increase administrative costs—in time and labor, as well as monetary expenditures,” which would “take valuable resources away from providing MH/SUD benefits.”
The Departments did not provide any substantive response to ERICs complaint and ultimately requested a stay on May 9, 2025. According to the stay request, “the Departments do not intend to enforce parts of the rule and have indicated that they intend to reconsider the regulation challenged in this litigation.”
In granting the government’s stay request on May 12, the US District Court for the District of Columbia ordered the parties to file a joint status report on August 7, 2025.
STATEMENT FROM THE DEPARTMENTS
The Trump administration has been public in its desire to rescind and modify regulations. In February, President Trump issued Executive Order 14219, which directed agencies to coordinate with their Department of Government Efficiency team leads and other federal agencies to develop a Unified Regulatory Agenda and either “rescind or modify” regulations based on seven classifications. Two of those classifications relate to regulations that “impose significant costs upon private parties that are not outweighed by public benefits,” and “regulations that impose undue burdens on small business and impede private enterprise and entrepreneurship.” The White House issued a Presidential Memorandum in April, again directing the repeal of unlawful regulations.7
Citing to Executive Order 14219 and the ERIC case, the Departments published the Statement on May 15, 2025 explaining that they requested the stay to allow them to “reconsider the 2024 Final [Regulations], including whether to issue a notice of proposed rulemaking rescinding or modifying the regulation through notice and comment rulemaking.” The Statement further explained that the Departments will not enforce any new requirements imposed by the 2024 Final Regulations that would have been effective on January 1, 2025 and January 1, 2026, 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.” This enforcement relief only applies to portions of the 2024 Final Regulations that go beyond the 2013 Final Regulations. The Statement also clarified that the 2013 Final Regulations remain in effect—including the Statutory Comparative Analysis Requirement—and that plans and issuers can continue to refer to these, as well as the sub-regulatory guidance like the 2021 FAQs, while they review the 2024 Final Regulations.8
TAKEAWAYS
Between the administration’s desire to repeal or modify regulations that impose costs and undue burdens on the business community and the Departments’ awareness of the onerous regulatory framework in the 2024 Final Regulations, the future of federal mental health parity will continue to be in flux. For self-insured employers, while the fiduciary certification requirements and certain aspects of the comparative analysis have been delayed, employer plans continue to be subject to the requirement that a comparative analysis be completed annually. Further, regardless of the status of agency enforcement efforts, employers remain vulnerable to participant lawsuits. Thus, employer plans should continue to work with their consultants and counsel to ensure their plans are in compliance and that such compliance is adequately documented.
- 42 U.S.C. § 300gg–26(a). ↩︎
- Prior to the passage of MHPAEA, the Mental Health Parity Act of 1996 provided that large group health plans cannot impose annual or lifetime dollar limits on mental health benefits that are less favorable than any such limits imposed on medical/surgical benefits. ↩︎
- NQTLs include, for example, prior authorization requirements, network adequacy, formulary design, and reimbursement rates. 45 C.F.R. § 164.136(c)(4). ↩︎
- Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 2900 (2020) (hereinafter CAA, 2021). ↩︎
- The 2024 Final Regulations define a “core treatment” as “a standard treatment or course of treatment, therapy, service, or intervention indicated by generally recognized independent standards of current medical practice” for a given condition. The 2024 Final Regulations also clarify that if there is no core treatment for a covered MH/SUD condition with respect to a Benefit Classification, the plan is not required to provide benefits for a core treatment for such condition, but the plan must provide benefits for such condition in every Benefit Classification in which medical/surgical benefits are provided. ↩︎
- ERIC is a trade organization that advocates on behalf of large employers regarding health, retirement, and compensation public policies at the federal, state, and local levels. ↩︎
- This Memorandum directed agencies to “immediately take steps to effectuate the repeal of any regulation, or portion of any regulation, that clearly exceeds the agency’s statutory authority or is otherwise unlawful,” as outlined in Executive Order 14219. ↩︎
- The requirement to complete and respond to requests for NQTL comparative analyses remain in effect, as required by CAA, 2021. ↩︎
