By Jonathan Stempel
(Reuters) – A new lawsuit by an employer trade group seeks to overturn a federal regulation backed by the Biden administration intended to ensure that the estimated 175 million Americans with private health insurance have access to affordable mental health services.
The “parity” rule, which became final in September, was intended to ensure that group health plans give access to benefits for mental health and substance abuse disorders on par with benefits for other medical conditions and surgeries.
But in a filing Friday, the ERISA Industry Committee said the U.S. Departments of Health and Human Services, Labor and Treasury lacked the authority to adopt the rules, including the requirement that plans covering mental health and substance abuse disorders provide “substantial benefits.”
The group, whose members are generally companies with more than 10,000 employees, said this “benefits mandate” is arbitrary and capricious, and limits employers’ ability to provide affordable coverage that fits the needs of their employees.
It also noted that the mandate could lead some plan sponsors to choose not to cover mental health conditions and substance abuse disorders at all.
“Plaintiff wholeheartedly supports the goals of mental health/substance abuse disorder parity, but the rule is a textbook example of regulatory overreach that undermines those goals by reducing access to high-quality, affordable care,” the lawsuit states.
Government agencies did not immediately respond to requests for comment.
President-elect Donald Trump, who begins his second term in the White House on Jan. 20, favors less government regulation than incumbent Joe Biden, and it is unclear whether the Trump administration will seek to change or eliminate the parity rule.
While the Mental Health Equity and Addiction Justice Act of 2008 was supposed to ensure access to mental health care, the Biden administration said more than half of US adults and nearly 70% of children with mental illness lack access.
Health care costs in the United States have come under fire, with new attention focused on the issue after last month’s fatal shooting of the CEO of UnitedHealthcare on a New York street.
Eugene Scalia, a lawyer for the trade group, said in a statement that government agencies “have lost sight of what is best for an effective mental health system, as well as the limits of their authority under the Constitution and the laws they are supposed to enforce.”
The Department of Labor regulates company-sponsored health plans under the Employee Retirement Income Security Act of 1974, or ERISA.
The case is ERISA Industry Committee v. US Department of Health and Human Services et al., US District Court, District of Columbia, No. 25-00136.
