Trump administration may rescind mental health parity rule, filing says

By Diana Novak Jones

May 12 - The Trump administration will not enforce a federal rule meant to ensure Americans with private health insurance have access to affordable mental health services and is considering rescinding it altogether, the U.S. Justice Department said in a court filing on Friday.

The filing in U.S. District Court for Washington, D.C., was in response to a lawsuit brought in January by the ERISA Industry Committee, which is representing large employers challenging the so-called mental health parity rule. The group says the rule limits their ability to provide affordable health benefits for workers. The parity rule became final in September.

The DOJ requested U.S. District Judge Timothy Kelly hold the lawsuit in abeyance while the U.S. Department of Health and Human Services, U.S. Department of the Treasury, and U.S. Department of Labor reconsider the rule.

A spokesperson for HHS said the agency doesn’t comment on pending litigation. Representatives for the other agencies did not immediately respond to requests for comment, nor did representatives for the ERISA Industry Committee.

In the filing, the DOJ noted that the ERISA Industry Committee consented to putting the lawsuit on hold as long as it can restart at any point.

The 2008 Mental Health Parity and Addiction Equity Act requires insurers and corporate-backed health plans, which cover more than 175 million Americans, to provide access and payment structures for mental health care services on par with other medical services.

But in practice that is often not the case, with less than half of U.S. adults with mental illness able to access care in 2020, according to former President Joe Biden's administration, which backed the regulation aimed at closing the gaps.

The ERISA Industry Committee, whose members are generally companies with more than 10,000 employees, sued to challenge the rule in January, just days before President Donald Trump took office. It said the mandate could lead some plan sponsors to decide not to cover mental health conditions and substance abuse disorders at all.

Ahead of a Monday deadline to respond to the lawsuit, the Trump administration provided the ERISA Industry Committee with a document outlining its plans to stop enforcing the rule. The agencies plan to reconsider the regulation as well, and may issue a notice of their plans to rescind or modify it, the DOJ said in the filing.

The Labor Department regulates company-sponsored health plans under the 1974 Employee Retirement Income Security Act, or ERISA.

The case is ERISA Industry Committee v U.S. Department of Health and Human Services et al., U.S. District Court, District of Columbia, No. 25-00136.

For the government: Erika Oblea

For the ERISA Industry Committee: Eugene Scalia, Matthew Rozen, Rebecca Smith, Robert Batista and Aaron Gyde of Gibson Dunn