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Mercer

Proposed Department of Labor rules would require ERISA plans processing disability claims to provide certain procedural protections similar to ACA standards for non-grandfathered group health plans. The new rules would treat coverage rescissions like benefit denials, require more detailed denial notices written in a "culturally and linguistically appropriate manner," and expand claimants' response rights. Unlike the ACA, however, the proposal does not call for external reviews. The changes would affect employers, insurers, and third-party administrators handling claims that call for a disability determination under ERISA welfare (and pension) plans.

 

 

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In a review of claims data for almost 100 Mercer employer clients, representing approximately 2.5 million members, we found that the Mental Health and Substance Abuse per member per year cost trend (for allowed charges) rose nearly 11%, in stark contrast to overall medical PMPY trend of 3.5%. And while MH/SA claims represent a small percentage of the overall medical claim costs (4%), a spike in the cost may be a symptom of a larger issue – and an opportunity for employers to get out in front. What’s driving this trend?

 

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