The Trump administration has paused new mental health parity rules issued in the final months of the Biden presidency, and Congress has curtailed funding for the Employee Benefits Security Administration (EBSA), the federal agency enforcing mental health parity in most employer-sponsored health insurance plans. The pause came after the ERISA Industry Committee, a trade group representing large employers, filed a lawsuit to block the rules. The Trump administration promised not to enforce them during litigation or for 18 months afterward.
The Suspended Rules and Their Purpose
The rules released in September 2024 were designed to strengthen enforcement of the 2008 Mental Health Parity and Addiction Equity Act. They required health plans to gather and report detailed data on how they restrict or deny mental health claims and to explain disparities when compared with medical care. According to Ali Khawar, who was second in command at EBSA before stepping down at the end of the Biden administration, the suspended rules “would be incredibly significant in driving better compliance.” Critics say the action “effectively gutted the parity law’s strongest protections.”
Funding and Staffing Cuts
EBSA’s workforce is set to drop from 831 workers in 2024 to 687 or fewer employees in 2026 due to expiration of temporary supplemental funding Congress approved in December 2020. The losses are concentrated in critical areas: benefit advisers are down about 30% and investigative staff has shrunk by nearly 40%. As a result, investigators are juggling higher caseloads and people seeking help face longer delays. Between February 2021 and July 2024, EBSA conducted 150 investigations and issued 70 letters finding parity law violations, with the agency acknowledging resources are “limited compared to the vast universe that it regulates”—one investigator per 7,700 health plans.
Potential Consequences
Federal employees and policy experts warn that the suspension and funding cuts could result in longer waits for patients challenging insurance decisions, fewer investigations of violations, and more people going without care they are legally entitled to. Researchers have well documented that insurers often block care, underpay mental health providers, and make it hard for patients to find help. EBSA can require “global corrections” when violations are found, forcing insurers to fix problems across multiple plans and return funds to patients.
This article is an AI-assisted summary. All facts and figures are drawn from the original report: https://www.propublica.org/article/mental-health-insurance-trump-rules