Washington, D.C., January 17, 2025 – The ERISA Industry Committee (ERIC) today filed a Complaint against the U.S. Departments of Labor, Health and Human Services, and Treasury (the Tri-Departments), seeking to invalidate the Final Rule issued by the Tri-Departments under the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) and the Consolidated Appropriations Act of 2021 (CAA). The suit was filed in the U.S. District Court for the District of Columbia. The Final Rule was issued in the twilight of the Biden Administration in September of 2024. Former Secretary of Labor Eugene Scalia and his colleagues at Gibson, Dunn & Crutcher LLP represent ERIC in this matter and prepared the Complaint, which is available here.
ERIC’s lawsuit alleges that the Final Rule is unlawful in numerous respects. The Final Rule exceeds the Tri-Departments’ authority under the MHPAEA and CAA, violates the Due Process Clause of the Fifth Amendment, is arbitrary and capricious, and otherwise violates the Administrative Procedure Act. ERIC’s lawsuit also alleges that the January 1, 2025 effective date for many of the Final Rule’s provisions is arbitrary and capricious because it did not leave enough time for plans to come into compliance with the entirely new, vaguely worded regulations.
“ERIC and its member companies whole-heartedly endorse the goals of the Mental Health Parity and Addiction Equity Act,” said Tom Christina, Executive Director of the ERIC Legal Center. “To be clear, this suit is not about whether there is value in offering mental health and substance use disorder benefits, because ERIC member companies already voluntarily offer those benefits. Our members are committed to offering robust mental health benefits, on par with all of the health benefits they offer, to ensure a healthy and productive workforce. But the new regulations issued by the Biden Administration exceed the Tri-Departments’ statutory authority under the laws that Congress passed, and threaten the ability of employers to offer high quality, affordable coverage for the mental health and substance use disorder needs of employees and their families.”
Commenting on the lawsuit, Mr. Scalia said, “Furthering the provision of quality mental health care is a worthy goal for all American employers, and for years has been an important objective of Congress, the Department of Labor, and the other Departments. In these new regulations, though, the Departments lost sight of what’s best for a workable mental health care system, and of the constraints on their authority under the Constitution and the laws they purported to implement.”
Since the MHPAEA’s enactment, ERIC has sought over the last 17 years to advance workable solutions that ensure employees have access to mental health and substance use disorder care. With more than 50 million people experiencing some sort of mental health crisis, ERIC’s 2021 report, “Prioritizing Employee Mental Health: Solutions for Congress,” offered lawmakers comprehensive solutions, including key recommendations to increase patient access to critical mental and behavioral health services.
The Tri-Departments’ Final Rule not only fails to meet those goals, but will undermine them. ERIC repeatedly engaged in efforts to educate regulators about unintended consequences stemming from this rule change. A timeline of those efforts follows below.
- The U.S. Departments of Labor (DOL), Health and Human Services (HHS), and Treasury (DOT) announced proposed changes to MHPAEA regulations on July 25, 2023.
- In July of 2023, ERIC, ABHW, AHIP and BCBSA swiftly expressed concern about the proposed changes. This stakeholder group continued its education and calls for change throughout the entirety of the process.
- In October of 2023, during the open comment period, ERIC formally submitted concerns about the proposed changes, outlining their serious potential consequences.
- In April 2024, ERIC launched a TV and digital ad campaign detailing the potential negative implications of the proposed changes.
- In May of 2024, ERIC sent a letter to the White House detailing its concerns with the proposed changes and urging President Biden to consider their potential effects.
Despite ERIC’s efforts, the Tri-Departments finalized their changes to MHPAEA regulations in September 2024. Through this lawsuit, ERIC is continuing its efforts to prevent the rule’s unintended consequences and restore a sensible approach to ensuring access to mental health and substance use disorder care.