MHPAEA update: Enforcement of the 2024 Final Rule Halted

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By: Colin Clark | Staff Attorney

Introduction

In a move that many expected, the Department of Health and Human Services, Department of Labor, and the United States Treasury Department (the Departments) announced that they will immediately halt enforcement of the 2024 Final Rule under the Mental Health Parity and Addiction Equity Act (“MHPAEA”). As of May 15, 2025, the Departments will not enforce the 2024 Final Rule, nor will they pursue enforcement of any noncompliance with the 2024 Final Rule prior to a final decision in pending litigation, plus an additional 18 months. The so-called “Final Rule” was released on September 9, 2024, and is a set of updated regulations and amendments to the 2013 final rule. It has been met with fierce opposition, most notably in a lawsuit filed in January 2024 by the ERISA Industry Committee (“ERIC”), a group that represents the employee benefits interests of employers. Although the halted enforcement of the 2024 Final Rule could be seen as a relief for some health plan sponsors, certain obligations remain, and this is a developing area of the law that warrants close attention.

What Is In the 2024 Final Rule?

The 2024 Final Rule is a set of updated regulations and amendments to the 2013 final rule. The goal of the 2024 Final Rule, as stated by the Departments, was “to strengthen consumer protections consistent with MHPAEA’s fundamental purpose – to ensure that individuals in group health plans or with group or individual health insurance coverage who seek treatment for covered mental health conditions or substance use disorders do not face greater burdens on access to benefits for those conditions or disorders than they would face when seeking coverage for the treatment of a medical condition or surgical procedure.” The Departments were planning to implement this broad goal through, among other things, tighter restrictions on Non-Quantitative Treatment Limitations (“NQTLs”), enhanced data collection and evaluations, and prohibiting the use of potentially discriminatory information related to mental health and substance use disorder benefits.

The Decision to Halt Enforcement

The lawsuit filed by ERIC challenged the 2024 Final Rule on many grounds and is an attempt to have the 2024 Final Rule completely invalidated. While the 2024 Final Rule has not been completely invalidated, on May 9, 2025, the Departments asked the US District Court to hold the lawsuit in abeyance—essentially a pause in the litigation—while they reconsider the 2024 Final Rule. This move was likely influenced by the Trump Administration’s latest Executive Order (Executive Order 14219, titled “Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative”) which directs federal agencies to review certain regulations considered to be an overreach or unlawful. Just days later, the Departments, consistent with their request for a pause in the litigation, released a statement detailing their non-enforcement policy on the MHPAEA’s 2024 Final Rule. It is important to note that while the 2024 Final Rule is in a state of limbo, and there is quite a long period of non-enforcement of the 2024 Final Rule provisions, sponsors must remain vigilant as their obligations under the MHPAEA remain.

Practical Implications

Despite the pause in litigation, the halting of any noncompliance enforcement, and the Departments’ reconsideration of the 2024 Final Rule, sponsors are not relieved from their current obligations under the 2013 final rule, including the obligation to perform a comparative analysis. Sponsors should continue to comply with all current provisions of the MHPAEA. Until there is a conclusion to this current litigation, or further guidance or modification of the current regulation, it is imperative that sponsors comply with all applicable MHPAEA requirements (such as NQTLs). Plan sponsors should continue to monitor the court case and any statements provided by the Trump Administration or the Departments on MHPAEA compliance obligations.