26 U.S.C. § 9812 — Parity in mental health and substance use

Page 4181 TITLE 26—INTERNAL REVENUE CODE § 9812 stay required under subsection (a) may not be greater than such coinsurance or cost-sharing for any preceding portion of such stay. (d) Level and type of reimbursements Nothing in this section shall be construed to prevent a group health plan from negotiating the level and type of reimbursement with a pro- vider for care provided in accordance with this section. (e) Preemption; exception for health insurance coverage in certain States The requirements of this section shall not apply with respect to health insurance coverage if there is a State law (including a decision, rule, regulation, or other State action having the effect of law) for a State that regulates such coverage that is described in any of the fol- lowing paragraphs: (1) Such State law requires such coverage to provide for at least a 48-hour hospital length of stay following a normal vaginal delivery and at least a 96-hour hospital length of stay following a caesarean section. (2) Such State law requires such coverage to provide for maternity and pediatric care in ac- cordance with guidelines established by the American College of Obstetricians and Gyne- cologists, the American Academy of Pediat- rics, or other established professional medical associations. (3) Such State law requires, in connection with such coverage for maternity care, that the hospital length of stay for such care is left to the decision of (or required to be made by) the attending provider in consultation with the mother. (Added Pub. L. 105–34, title XV, § 1531(a)(4), Aug. 5, 1997, 111 Stat. 1081; amended Pub. L. 105–206, title VI, § 6015(e), July 22, 1998, 112 Stat. 821.) Editorial Notes AMENDMENTS 1998—Subsecs. (e), (f). Pub. L. 105–206 redesignated subsec. (f) as (e). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1998 AMENDMENT Amendment by Pub. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 6024 of Pub. L. 105–206, set out as a note under section 1 of this title. EFFECTIVE DATE Section applicable with respect to group health plans for plan years beginning on or after Jan. 1, 1998, see sec- tion 1531(c) of Pub. L. 105–34, set out as an Effective Date of 1997 Amendment note under section 4980D of this title. § 9812. Parity in mental health and substance use disorder benefits (a) In general (1) Aggregate lifetime limits In the case of a group health plan that pro- vides both medical and surgical benefits and mental health or substance use disorder bene- fits— (A) No lifetime limit If the plan does not include an aggregate lifetime limit on substantially all medical and surgical benefits, the plan may not im- pose any aggregate lifetime limit on mental health or substance use disorder benefits. (B) Lifetime limit If the plan includes an aggregate lifetime limit on substantially all medical and sur- gical benefits (in this paragraph referred to as the ‘‘applicable lifetime limit’’), the plan shall either— (i) apply the applicable lifetime limit both to the medical and surgical benefits to which it otherwise would apply and to mental health and substance use disorder benefits and not distinguish in the applica- tion of such limit between such medical and surgical benefits and mental health and substance use disorder benefits; or (ii) not include any aggregate lifetime limit on mental health or substance use disorder benefits that is less than the ap- plicable lifetime limit. (C) Rule in case of different limits In the case of a plan that is not described in subparagraph (A) or (B) and that includes no or different aggregate lifetime limits on different categories of medical and surgical benefits, the Secretary shall establish rules under which subparagraph (B) is applied to such plan with respect to mental health and substance use disorder benefits by sub- stituting for the applicable lifetime limit an average aggregate lifetime limit that is computed taking into account the weighted average of the aggregate lifetime limits ap- plicable to such categories. (2) Annual limits In the case of a group health plan that pro- vides both medical and surgical benefits and mental health or substance use disorder bene- fits— (A) No annual limit If the plan does not include an annual limit on substantially all medical and sur- gical benefits, the plan may not impose any annual limit on mental health or substance use disorder benefits. (B) Annual limit If the plan includes an annual limit on substantially all medical and surgical bene- fits (in this paragraph referred to as the ‘‘ap- plicable annual limit’’), the plan shall ei- ther— (i) apply the applicable annual limit both to medical and surgical benefits to which it otherwise would apply and to mental health and substance use disorder benefits and not distinguish in the applica- tion of such limit between such medical and surgical benefits and mental health and substance use disorder benefits; or (ii) not include any annual limit on men- tal health or substance use disorder bene- fits that is less than the applicable annual limit. Page 4182 TITLE 26—INTERNAL REVENUE CODE § 9812 (C) Rule in case of different limits In the case of a plan that is not described in subparagraph (A) or (B) and that includes no or different annual limits on different categories of medical and surgical benefits, the Secretary shall establish rules under which subparagraph (B) is applied to such plan with respect to mental health and sub- stance use disorder benefits by substituting for the applicable annual limit an average annual limit that is computed taking into account the weighted average of the annual limits applicable to such categories. (3) Financial requirements and treatment limi- tations (A) In general In the case of a group health plan that pro- vides both medical and surgical benefits and mental health or substance use disorder ben- efits, such plan shall ensure that— (i) the financial requirements applicable to such mental health or substance use disorder benefits are no more restrictive than the predominant financial require- ments applied to substantially all medical and surgical benefits covered by the plan, and there are no separate cost sharing re- quirements that are applicable only with respect to mental health or substance use disorder benefits; and (ii) the treatment limitations applicable to such mental health or substance use disorder benefits are no more restrictive than the predominant treatment limita- tions applied to substantially all medical and surgical benefits covered by the plan and there are no separate treatment limi- tations that are applicable only with re- spect to mental health or substance use disorder benefits. (B) Definitions In this paragraph: (i) Financial requirement The term ‘‘financial requirement’’ in- cludes deductibles, copayments, coinsur- ance, and out-of-pocket expenses, but ex- cludes an aggregate lifetime limit and an annual limit subject to paragraphs (1) and (2). (ii) Predominant A financial requirement or treatment limit is considered to be predominant if it is the most common or frequent of such type of limit or requirement. (iii) Treatment limitation The term ‘‘treatment limitation’’ in- cludes limits on the frequency of treat- ment, number of visits, days of coverage, or other similar limits on the scope or du- ration of treatment. (4) Availability of plan information The criteria for medical necessity deter- minations made under the plan with respect to mental health or substance use disorder bene- fits shall be made available by the plan admin- istrator in accordance with regulations to any current or potential participant, beneficiary, or contracting provider upon request. The rea- son for any denial under the plan of reim- bursement or payment for services with re- spect to mental health or substance use dis- order benefits in the case of any participant or beneficiary shall, on request or as otherwise required, be made available by the plan admin- istrator to the participant or beneficiary in accordance with regulations. (5) Out-of-network providers In the case of a plan that provides both med- ical and surgical benefits and mental health or substance use disorder benefits, if the plan provides coverage for medical or surgical ben- efits provided by out-of-network providers, the plan shall provide coverage for mental health or substance use disorder benefits provided by out-of-network providers in a manner that is consistent with the requirements of this sec- tion. (6) Compliance program guidance document (A) In general The Secretary, the Secretary of Health and Human Services, and the Secretary of Labor, in consultation with the Inspector General of the Department of Health and Human Services, the Inspector General of the Department of Labor, and the Inspector General of the Department of the Treasury, shall issue a compliance program guidance document to help improve compliance with this section, section 2726 of the Public Health Service Act, and section 712 of the Employee Retirement Income Security Act of 1974, as applicable. In carrying out this paragraph, the Secretaries may take into consideration the 2016 publication of the De- partment of Health and Human Services and the Department of Labor, entitled ‘‘Warning Signs - Plan or Policy Non-Quantitative Treatment Limitations (NQTLs) that Re- quire Additional Analysis to Determine Mental Health Parity Compliance’’. (B) Examples illustrating compliance and noncompliance (i) In general The compliance program guidance docu- ment required under this paragraph shall provide illustrative, de-identified examples (that do not disclose any protected health information or individually identifiable in- formation) of previous findings of compli- ance and noncompliance with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retire- ment Income Security Act of 1974, as ap- plicable, based on investigations of viola- tions of such sections, including— (I) examples illustrating requirements for information disclosures and non- quantitative treatment limitations; and (II) descriptions of the violations un- covered during the course of such inves- tigations. (ii) Nonquantitative treatment limitations To the extent that any example de- scribed in clause (i) involves a finding of Page 4183 TITLE 26—INTERNAL REVENUE CODE § 9812 compliance or noncompliance with regard to any requirement for nonquantitative treatment limitations, the example shall provide sufficient detail to fully explain such finding, including a full description of the criteria involved for approving medical and surgical benefits and the criteria in- volved for approving mental health and substance use disorder benefits. (iii) Access to additional information re- garding compliance In developing and issuing the compliance program guidance document required under this paragraph, the Secretaries spec- ified in subparagraph (A)— (I) shall enter into interagency agree- ments with the Inspector General of the Department of Health and Human Serv- ices, the Inspector General of the De- partment of Labor, and the Inspector General of the Department of the Treas- ury to share findings of compliance and noncompliance with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Security Act of 1974, as applica- ble; and (II) shall seek to enter into an agree- ment with a State to share information on findings of compliance and non- compliance with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Security Act of 1974, as applica- ble. (C) Recommendations The compliance program guidance docu- ment shall include recommendations to ad- vance compliance with this section, section 2726 of the Public Health Service Act, or sec- tion 712 of the Employee Retirement Income Security Act of 1974, as applicable, and en- courage the development and use of internal controls to monitor adherence to applicable statutes, regulations, and program require- ments. Such internal controls may include illustrative examples of nonquantitative treatment limitations on mental health and substance use disorder benefits, which may fail to comply with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Se- curity Act of 1974, as applicable, in relation to nonquantitative treatment limitations on medical and surgical benefits. (D) Updating the compliance program guid- ance document The Secretary, the Secretary of Health and Human Services, and the Secretary of Labor, in consultation with the Inspector General of the Department of Health and Human Services, the Inspector General of the Department of Labor, and the Inspector General of the Department of the Treasury, shall update the compliance program guid- ance document every 2 years to include il- lustrative, de-identified examples (that do not disclose any protected health informa- tion or individually identifiable informa- tion) of previous findings of compliance and noncompliance with this section, section 2726 of the Public Health Service Act, or sec- tion 712 of the Employee Retirement Income Security Act of 1974, as applicable. (7) Additional guidance (A) In general The Secretary, the Secretary of Health and Human Services, and the Secretary of Labor shall issue guidance to group health plans to assist such plans in satisfying the requirements of this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Secu- rity Act of 1974, as applicable. (B) Disclosure (i) Guidance for plans The guidance issued under this para- graph shall include clarifying information and illustrative examples of methods that group health plans may use for disclosing information to ensure compliance with the requirements under this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement In- come Security Act of 1974, as applicable, (and any regulations promulgated pursu- ant to such sections, as applicable). (ii) Documents for participants, bene- ficiaries, contracting providers, or au- thorized representatives The guidance issued under this para- graph shall include clarifying information and illustrative examples of methods that group health plans may use to provide any participant, beneficiary, contracting pro- vider, or authorized representative, as ap- plicable, with documents containing infor- mation that the health plans are required to disclose to participants, beneficiaries, contracting providers, or authorized rep- resentatives to ensure compliance with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Security Act of 1974, as applicable, compliance with any regulation issued pursuant to such re- spective section, or compliance with any other applicable law or regulation. Such guidance shall include information that is comparative in nature with respect to— (I) nonquantitative treatment limita- tions for both medical and surgical bene- fits and mental health and substance use disorder benefits; (II) the processes, strategies, evi- dentiary standards, and other factors used to apply the limitations described in subclause (I); and (III) the application of the limitations described in subclause (I) to ensure that such limitations are applied in parity with respect to both medical and sur- gical benefits and mental health and substance use disorder benefits. (C) Nonquantitative treatment limitations The guidance issued under this paragraph shall include clarifying information and il- Page 4184 TITLE 26—INTERNAL REVENUE CODE § 9812 lustrative examples of methods, processes, strategies, evidentiary standards, and other factors that group health plans may use re- garding the development and application of nonquantitative treatment limitations to ensure compliance with this section, section 2726 of the Public Health Service Act, or sec- tion 712 of the Employee Retirement Income Security Act of 1974, as applicable, (and any regulations promulgated pursuant to such respective section), including— (i) examples of methods of determining appropriate types of nonquantitative treatment limitations with respect to both medical and surgical benefits and mental health and substance use disorder benefits, including nonquantitative treatment limi- tations pertaining to— (I) medical management standards based on medical necessity or appro- priateness, or whether a treatment is ex- perimental or investigative; (II) limitations with respect to pre- scription drug formulary design; and (III) use of fail-first or step therapy protocols; (ii) examples of methods of deter- mining— (I) network admission standards (such as credentialing); and (II) factors used in provider reimburse- ment methodologies (such as service type, geographic market, demand for services, and provider supply, practice size, training, experience, and licensure) as such factors apply to network ade- quacy; (iii) examples of sources of information that may serve as evidentiary standards for the purposes of making determinations regarding the development and application of nonquantitative treatment limitations; (iv) examples of specific factors, and the evidentiary standards used to evaluate such factors, used by such plans in per- forming a nonquantitative treatment limi- tation analysis; (v) examples of how specific evidentiary standards may be used to determine whether treatments are considered experi- mental or investigative; (vi) examples of how specific evidentiary standards may be applied to each service category or classification of benefits; (vii) examples of methods of reaching ap- propriate coverage determinations for new mental health or substance use disorder treatments, such as evidence-based early intervention programs for individuals with a serious mental illness and types of med- ical management techniques; (viii) examples of methods of reaching appropriate coverage determinations for which there is an indirect relationship be- tween the covered mental health or sub- stance use disorder benefit and a tradi- tional covered medical and surgical ben- efit, such as residential treatment or hos- pitalizations involving voluntary or invol- untary commitment; and (ix) additional illustrative examples of methods, processes, strategies, evidentiary standards, and other factors for which the Secretary determines that additional guid- ance is necessary to improve compliance with this section, section 2726 of the Public Health Service Act, or section 712 of the Employee Retirement Income Security Act of 1974, as applicable. (D) Public comment Prior to issuing any final guidance under this paragraph, the Secretary shall provide a public comment period of not less than 60 days during which any member of the public may provide comments on a draft of the guidance. (8) Compliance requirements (A) Nonquantitative treatment limitation (NQTL) requirements In the case of a group health plan that pro- vides both medical and surgical benefits and mental health or substance use disorder ben- efits and that imposes nonquantitative treatment limitations (referred to in this section as ‘‘NQTLs’’) on mental health or substance use disorder benefits, such plan shall perform and document comparative analyses of the design and application of NQTLs and, beginning 45 days after the date of enactment of the Consolidated Appropria- tions Act, 2021, make available to the Sec- retary, upon request, the comparative anal- yses and the following information: (i) The specific plan terms or other rel- evant terms regarding the NQTLs and a description of all mental health or sub- stance use disorder and medical or surgical benefits to which each such term applies in each respective benefits classification. (ii) The factors used to determine that the NQTLs will apply to mental health or substance use disorder benefits and med- ical or surgical benefits. (iii) The evidentiary standards used for the factors identified in clause (ii), when applicable, provided that every factor shall be defined, and any other source or evi- dence relied upon to design and apply the NQTLs to mental health or substance use disorder benefits and medical or surgical benefits. (iv) The comparative analyses dem- onstrating that the processes, strategies, evidentiary standards, and other factors used to apply the NQTLs to mental health or substance use disorder benefits, as writ- ten and in operation, are comparable to, and are applied no more stringently than, the processes, strategies, evidentiary standards, and other factors used to apply the NQTLs to medical or surgical benefits in the benefits classification. (v) A disclosure of the specific findings and conclusions reached by the group health plan, including any results of the analyses described in this subparagraph that indicate that the plan is or is not in compliance with this section. Page 4185 TITLE 26—INTERNAL REVENUE CODE § 9812 (B) Secretary request process (i) Submission upon request The Secretary shall request that a group health plan submit the comparative anal- yses described in subparagraph (A) for plans that involve potential violations of this section or complaints regarding non- compliance with this section that concern NQTLs and any other instances in which the Secretary determines appropriate. The Secretary shall request not fewer than 20 such analyses per year. (ii) Additional information In instances in which the Secretary has concluded that the group health plan has not submitted sufficient information for the Secretary to review the comparative analyses described in subparagraph (A), as requested under clause (i), the Secretary shall specify to the plan the information the plan must submit to be responsive to the request under clause (i) for the Sec- retary to review the comparative analyses described in subparagraph (A) for compli- ance with this section. Nothing in this paragraph shall require the Secretary to conclude that a group health plan is in compliance with this section solely based upon the inspection of the comparative analyses described in subparagraph (A), as requested under clause (i). (iii) Required action (I) In general In instances in which the Secretary has reviewed the comparative analyses described in subparagraph (A), as re- quested under clause (i), and determined that the group health plan is not in com- pliance with this section, the plan— (aa) shall specify to the Secretary the actions the plan will take to be in compliance with this section and pro- vide to the Secretary additional com- parative analyses described in subpara- graph (A) that demonstrate compli- ance with this section not later than 45 days after the initial determination by the Secretary that the plan is not in compliance; and (bb) following the 45-day corrective action period under item (aa), if the Secretary makes a final determination that the plan still is not in compliance with this section, not later than 7 days after such determination, shall notify all individuals enrolled in the plan that the plan has been determined to be not in compliance with this section. (II) Exemption from disclosure Documents or communications pro- duced in connection with the Secretary’s recommendations to a group health plan shall not be subject to disclosure pursu- ant to section 552 of title 5, United States Code. (iv) Report Not later than 1 year after the date of enactment of this paragraph, and not later than October 1 of each year thereafter, the Secretary shall submit to Congress, and make publicly available, a report that con- tains— (I) a summary of the comparative anal- yses requested under clause (i), including the identity of each group plan that is determined to be not in compliance after the final determination by the Secretary described in clause (iii)(I)(bb); (II) the Secretary’s conclusions as to whether each group health plan sub- mitted sufficient information for the Secretary to review the comparative analyses requested under clause (i) for compliance with this section; (III) for each group health plan that did submit sufficient information for the Secretary to review the comparative analyses requested under clause (i), the Secretary’s conclusions as to whether and why the plan is in compliance with the disclosure requirements under this section; (IV) the Secretary’s specifications de- scribed in clause (ii) for each group health plan that the Secretary deter- mined did not submit sufficient informa- tion for the Secretary to review the com- parative analyses requested under clause (i) for compliance with this section; and (V) the Secretary’s specifications de- scribed in clause (iii) of the actions each group health plan that the Secretary de- termined is not in compliance with this section must take to be in compliance with this section, including the reason why the Secretary determined the plan is not in compliance. (C) Compliance program guidance document update process (i) In general The Secretary shall include instances of noncompliance that the Secretary dis- covers upon reviewing the comparative analyses requested under subparagraph (B)(i) in the compliance program guidance document described in paragraph (6), as it is updated every 2 years, except that such instances shall not disclose any protected health information or individually identi- fiable information. (ii) Guidance and regulations Not later than 18 months after the date of enactment of this paragraph, the Sec- retary shall finalize any draft or interim guidance and regulations relating to men- tal health parity under this section. Such draft guidance shall include guidance to clarify the process and timeline for cur- rent and potential participants and bene- ficiaries (and authorized representatives and health care providers of such partici- pants and beneficiaries) with respect to plans to file complaints of such plans being in violation of this section, includ- ing guidance, by plan type, on the relevant State, regional, or national office with which such complaints should be filed. Page 4186 TITLE 26—INTERNAL REVENUE CODE § 9812 (iii) State The Secretary shall share information on findings of compliance and noncompli- ance discovered upon reviewing the com- parative analyses requested under sub- paragraph (B)(i) shall be shared with the State where the group health plan is lo- cated, in accordance with paragraph (6)(B)(iii)(II). (b) Construction Nothing in this section shall be construed— (1) as requiring a group health plan to pro- vide any mental health or substance use dis- order benefits; or (2) in the case of a group health plan that provides mental health or substance use dis- order benefits, as affecting the terms and con- ditions of the plan relating to such benefits under the plan, except as provided in sub- section (a). (c) Exemptions (1) Small employer exemption (A) In general This section shall not apply to any group health plan for any plan year of a small em- ployer. (B) Small employer For purposes of subparagraph (A), the term ‘‘small employer’’ means, with respect to a calendar year and a plan year, an employer who employed an average of at least 2 (or 1 in the case of an employer residing in a State that permits small groups to include a single individual) but not more than 50 em- ployees on business days during the pre- ceding calendar year. For purposes of the preceding sentence, all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as 1 employer and rules similar to rules of sub- paragraphs (B) and (C) of section 4980D(d)(2) shall apply. (2) Cost exemption (A) In general With respect to a group health plan, if the application of this section to such plan re- sults in an increase for the plan year in- volved of the actual total costs of coverage with respect to medical and surgical benefits and mental health and substance use dis- order benefits under the plan (as determined and certified under subparagraph (C)) by an amount that exceeds the applicable percent- age described in subparagraph (B) of the ac- tual total plan costs, the provisions of this section shall not apply to such plan during the following plan year, and such exemption shall apply to the plan for 1 plan year. An employer may elect to continue to apply mental health and substance use disorder parity pursuant to this section with respect to the group health plan involved regardless of any increase in total costs. (B) Applicable percentage With respect to a plan, the applicable per- centage described in this subparagraph shall be— (i) 2 percent in the case of the first plan year in which this section is applied; and (ii) 1 percent in the case of each subse- quent plan year. (C) Determinations by actuaries Determinations as to increases in actual costs under a plan for purposes of this sec- tion shall be made and certified by a quali- fied and licensed actuary who is a member in good standing of the American Academy of Actuaries. All such determinations shall be in a written report prepared by the actuary. The report, and all underlying documenta- tion relied upon by the actuary, shall be maintained by the group health plan for a period of 6 years following the notification made under subparagraph (E). (D) 6-month determinations If a group health plan seeks an exemption under this paragraph, determinations under subparagraph (A) shall be made after such plan has complied with this section for the first 6 months of the plan year involved. (E) Notification (i) In general A group health plan that, based upon a certification described under subparagraph (C), qualifies for an exemption under this paragraph, and elects to implement the ex- emption, shall promptly notify the Sec- retary, the appropriate State agencies, and participants and beneficiaries in the plan of such election. (ii) Requirement A notification to the Secretary under clause (i) shall include— (I) a description of the number of cov- ered lives under the plan involved at the time of the notification, and as applica- ble, at the time of any prior election of the cost-exemption under this paragraph by such plan; (II) for both the plan year upon which a cost exemption is sought and the year prior, a description of the actual total costs of coverage with respect to medical and surgical benefits and mental health and substance use disorder benefits under the plan; and (III) for both the plan year upon which a cost exemption is sought and the year prior, the actual total costs of coverage with respect to mental health and sub- stance use disorder benefits under the plan. (iii) Confidentiality A notification to the Secretary under clause (i) shall be confidential. The Sec- retary shall make available, upon request and on not more than an annual basis, an anonymous itemization of such notifica- tions, that includes— (I) a breakdown of States by the size and type of employers submitting such notification; and (II) a summary of the data received under clause (ii). Page 4187 TITLE 26—INTERNAL REVENUE CODE § 9812 (F) Audits by appropriate agencies To determine compliance with this para- graph, the Secretary may audit the books and records of a group health plan relating to an exemption, including any actuarial re- ports prepared pursuant to subparagraph (C), during the 6 year period following the notifi- cation of such exemption under subpara- graph (E). A State agency receiving a notifi- cation under subparagraph (E) may also con- duct such an audit with respect to an exemp- tion covered by such notification. (d) Separate application to each option offered In the case of a group health plan that offers a participant or beneficiary two or more benefit package options under the plan, the require- ments of this section shall be applied separately with respect to each such option. (e) Definitions For purposes of this section: (1) Aggregate lifetime limit The term ‘‘aggregate lifetime limit’’ means, with respect to benefits under a group health plan, a dollar limitation on the total amount that may be paid with respect to such benefits under the plan with respect to an individual or other coverage unit. (2) Annual limit The term ‘‘annual limit’’ means, with re- spect to benefits under a group health plan, a dollar limitation on the total amount of bene- fits that may be paid with respect to such ben- efits in a 12-month period under the plan with respect to an individual or other coverage unit. (3) Medical or surgical benefits The term ‘‘medical or surgical benefits’’ means benefits with respect to medical or sur- gical services, as defined under the terms of the plan, but does not include mental health or substance use disorder benefits. (4) Mental health benefits The term ‘‘mental health benefits’’ means benefits with respect to services for mental health conditions, as defined under the terms of the plan and in accordance with applicable Federal and State law. (5) Substance use disorder benefits The term ‘‘substance use disorder benefits’’ means benefits with respect to services for substance use disorders, as defined under the terms of the plan and in accordance with ap- plicable Federal and State law. (Added Pub. L. 105–34, title XV, § 1531(a)(4), Aug. 5, 1997, 111 Stat. 1083; amended Pub. L. 107–116, title VII, § 701(c), Jan. 10, 2002, 115 Stat. 2228; Pub. L. 107–147, title VI, § 610(a), Mar. 9, 2002, 116 Stat. 60; Pub. L. 108–311, title III, § 302(a), Oct. 4, 2004, 118 Stat. 1178; Pub. L. 109–151, § 1(c), Dec. 30, 2005, 119 Stat. 2886; Pub. L. 109–432, div. A, title I, § 115(a), Dec. 20, 2006, 120 Stat. 2941; Pub. L. 110–245, title IV, § 401(a), June 17, 2008, 122 Stat. 1649; Pub. L. 110–343, div. C, title V, § 512(c), (g)(3)(A), Oct. 3, 2008, 122 Stat. 3888, 3892; Pub. L. 115–141, div. U, title IV, § 401(a)(349), Mar. 23, 2018, 132 Stat. 1201; Pub. L. 116–260, div. BB, title II, § 203(a)(3), Dec. 27, 2020, 134 Stat. 2910.) Editorial Notes REFERENCES IN TEXT Section 2726 of the Public Health Service Act, re- ferred to in subsec. (a)(6), (7), is classified to section 300gg–26 of Title 42, The Public Health and Welfare. Section 712 of the Employee Retirement Income Se- curity Act of 1974, referred to in subsec. (a)(6), (7), is classified to section 1185a of Title 29, Labor. The date of enactment of the Consolidated Appropria- tions Act, 2021, and the date of enactment of this para- graph, referred to in subsec. (a)(8)(A), (B)(iv), (C)(ii), is the date of enactment of Pub. L. 116–260, which was ap- proved Dec. 27, 2020. AMENDMENTS 2020—Subsec. (a)(6) to (8). Pub. L. 116–260 added pars. (6) to (8). 2018—Subsec. (a)(3)(B)(i). Pub. L. 115–141 substituted period for comma at end. 2008—Pub. L. 110–343, § 512(g)(3)(A), substituted ‘‘Par- ity in mental health and substance use disorder bene- fits’’ for ‘‘Parity in the application of certain limits to mental health benefits’’ in section catchline. Subsec. (a)(1), (2). Pub. L. 110–343, § 512(c)(7), sub- stituted ‘‘mental health or substance use disorder bene- fits’’ for ‘‘mental health benefits’’ wherever appearing in pars. (1)(introductory provisions), (A), and (B)(ii) and (2)(introductory provisions), (A), and (B)(ii). Pub. L. 110–343, § 512(c)(6), substituted ‘‘mental health and substance use disorder benefits’’ for ‘‘mental health benefits’’ wherever appearing in pars. (1)(B)(i) and (C) and (2)(B)(i) and (C). Subsec. (a)(3) to (5). Pub. L. 110–343, § 512(c)(1), added pars. (3) to (5). Subsec. (b)(1). Pub. L. 110–343, § 512(c)(7), substituted ‘‘mental health or substance use disorder benefits’’ for ‘‘mental health benefits’’. Subsec. (b)(2). Pub. L. 110–343, § 512(c)(2), amended par. (2) generally. Prior to amendment, par. (2) read as fol- lows: ‘‘in the case of a group health plan that provides mental health benefits, as affecting the terms and con- ditions (including cost sharing, limits on numbers of visits or days of coverage, and requirements relating to medical necessity) relating to the amount, duration, or scope of mental health benefits under the plan, except as specifically provided in subsection (a) (in regard to parity in the imposition of aggregate lifetime limits and annual limits for mental health benefits).’’ Subsec. (c)(1). Pub. L. 110–343, § 512(c)(3)(A), amended par. (1) generally. Prior to amendment, text read as fol- lows: ‘‘This section shall not apply to any group health plan for any plan year of a small employer (as defined in section 4980D(d)(2)).’’ Subsec. (c)(2). Pub. L. 110–343, § 512(c)(3)(B), added par. (2) and struck out former par. (2). Prior to amendment, text read as follows: ‘‘This section shall not apply with respect to a group health plan if the application of this section to such plan results in an increase in the cost under the plan of at least 1 percent.’’ Subsec. (e)(3). Pub. L. 110–343, § 512(c)(7), substituted ‘‘mental health or substance use disorder benefits’’ for ‘‘mental health benefits’’. Subsec. (e)(4). Pub. L. 110–343, § 512(c)(7), which di- rected substitution of ‘‘mental health or substance use disorder benefits’’ for ‘‘mental health benefits’’ wher- ever appearing in this section (other than in any provi- sion amended by section 512(c)(6) of Pub. L. 110–343), was not executed to par. (4) as added by Pub. L. 110–343, § 512(c)(4), to reflect the probable intent of Congress. See below. Subsec. (e)(4). Pub. L. 110–343, § 512(c)(4), added par. (4) and struck out former par. (4). Prior to amendment, text read as follows: ‘‘The term ‘mental health benefits’ means benefits with respect to mental health services, as defined under the terms of the plan, but does not in- clude benefits with respect to treatment of substance abuse or chemical dependency.’’ Subsec. (e)(5). Pub. L. 110–343, § 512(c)(4), added par. (5). Page 4188 TITLE 26—INTERNAL REVENUE CODE § 9813 Subsec. (f). Pub. L. 110–343, § 512(c)(5), struck out sub- sec. (f). Text read as follows: ‘‘This section shall not apply to benefits for services furnished— ‘‘(1) on or after September 30, 2001, and before Janu- ary 10, 2002, ‘‘(2) on or after January 1, 2004, and before the date of the enactment of the Working Families Tax Relief Act of 2004, ‘‘(3) on or after January 1, 2008, and before the date of the enactment of the Heroes Earnings Assistance and Relief Tax Act of 2008, and ‘‘(4) after December 31, 2008.’’ Subsec. (f)(3), (4). Pub. L. 110–245 added pars. (3) and (4) and struck out former par. (3) which read as follows: ‘‘after December 31, 2007.’’ 2006—Subsec. (f)(3). Pub. L. 109–432 substituted ‘‘De- cember 31, 2007’’ for ‘‘December 31, 2006’’. 2005—Subsec. (f)(3). Pub. L. 109–151 substituted ‘‘De- cember 31, 2006’’ for ‘‘December 31, 2005’’. 2004—Subsec. (f)(2), (3). Pub. L. 108–311 added pars. (2) and (3) and struck out former par. (2) which read as fol- lows: ‘‘after December 31, 2003.’’ 2002—Subsec. (f). Pub. L. 107–147 amended heading and text of subsec. (f) generally. Prior to amendment, text read as follows: ‘‘This section shall not apply to bene- fits for services furnished on or after December 31, 2002.’’ Subsec. (f). Pub. L. 107–116 substituted ‘‘December 31, 2002’’ for ‘‘September 30, 2001’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2008 AMENDMENT Amendment by Pub. L. 110–343 applicable with re- spect to group health plans for plan years beginning after the date that is 1 year after Oct. 3, 2008, except that amendment by section 512(c)(5) of Pub. L. 110–343 effective Jan. 1, 2009, with special rule for collective bargaining agreements, see section 512(e) of Pub. L. 110–343, set out as a note under section 300gg–26 of Title 42, The Public Health and Welfare. EFFECTIVE DATE OF 2004 AMENDMENT Pub. L. 108–311, title III, § 302(d), Oct. 4, 2004, 118 Stat. 1179, provided that: ‘‘The amendments made by this section [amending this section, section 1185a of Title 29, Labor, and section 300gg–5 of Title 42, The Public Health and Welfare] shall take effect on the date of the enactment of this Act [Oct. 4, 2004].’’ EFFECTIVE DATE OF 2002 AMENDMENT Pub. L. 107–147, title VI, § 610(b), Mar. 9, 2002, 116 Stat. 60, provided that: ‘‘The amendment made by subsection (a) [amending this section] shall apply to plan years be- ginning after December 31, 2000.’’ EFFECTIVE DATE Section applicable with respect to group health plans for plan years beginning on or after Jan. 1, 1998, see sec- tion 1531(c) of Pub. L. 105–34, set out as an Effective Date of 1997 Amendment note under section 4980D of this title. GUIDANCE Pub. L. 116–260, div. BB, title II, § 203(b), Dec. 27, 2020, 134 Stat. 2918, provided that: ‘‘The Secretary of Health and Human Services, jointly with the Secretary of Labor and the Secretary of the Treasury, shall issue guidance to carry out the amendments made by para- graphs (1), (2), and (3) of subsection (a) [amending this section, section 1185a of Title 29, Labor, and section 300gg–26 of Title 42, The Public Health and Welfare].’’ § 9813. Coverage of dependent students on medi- cally necessary leave of absence (a) Medically necessary leave of absence In this section, the term ‘‘medically necessary leave of absence’’ means, with respect to a de- pendent child described in subsection (b)(2) in connection with a group health plan, a leave of absence of such child from a postsecondary edu- cational institution (including an institution of higher education as defined in section 102 of the Higher Education Act of 1965), or any other change in enrollment of such child at such an institution, that— (1) commences while such child is suffering from a serious illness or injury; (2) is medically necessary; and (3) causes such child to lose student status for purposes of coverage under the terms of the plan or coverage. (b) Requirement to continue coverage (1) In general In the case of a dependent child described in paragraph (2), a group health plan shall not terminate coverage of such child under such plan due to a medically necessary leave of ab- sence before the date that is the earlier of— (A) the date that is 1 year after the first day of the medically necessary leave of ab- sence; or (B) the date on which such coverage would otherwise terminate under the terms of the plan. (2) Dependent child described A dependent child described in this para- graph is, with respect to a group health plan, a beneficiary under the plan who— (A) is a dependent child, under the terms of the plan, of a participant or beneficiary under the plan; and (B) was enrolled in the plan, on the basis of being a student at a postsecondary edu- cational institution (as described in sub- section (a)), immediately before the first day of the medically necessary leave of absence involved. (3) Certification by physician Paragraph (1) shall apply to a group health plan only if the plan, or the issuer of health insurance coverage offered in connection with the plan, has received written certification by a treating physician of the dependent child which states that the child is suffering from a serious illness or injury and that the leave of absence (or other change of enrollment) de- scribed in subsection (a) is medically nec- essary. (c) Notice A group health plan shall include, with any notice regarding a requirement for certification of student status for coverage under the plan, a description of the terms of this section for con- tinued coverage during medically necessary leaves of absence. Such description shall be in language which is understandable to the typical plan participant. (d) No change in benefits A dependent child whose benefits are contin- ued under this section shall be entitled to the same benefits as if (during the medically nec- essary leave of absence) the child continued to be a covered student at the institution of higher education and was not on a medically necessary leave of absence.