At this year’s Disability Management Employer Coalition (DMEC) Compliance Conference in Columbus, Ohio, aequum’s Jack Towarnicky offered insight on two mental health topics: Mental Health in the Workplace and The Mental Health LTD Challenge: Because Parity is Not a Priority … Yet.

These conversations confirmed that employers, plan sponsors and disability management administrators can no longer treat mental health as a secondary concern. Further, a proactive change to Long Term Disability (LTD) benefits is both necessary and financially manageable.

Mental Health in the Workplace: A Crisis Employers Can’t Ignore

Jack moderated a roundtable on mental health in the workplace, where disability management professionals shared challenges and practical approaches. The session opened with a discussion on return-to-office (RTO) resistance, a consistent source of stress for both employers and employees.

The conversation quickly shifted to a broader issue as nearly every participant agreed that American employers and employees are facing a full-blown mental health crisis. Referencing a recent survey where 74% of Americans shared this view, the room echoed with consensus, acknowledgement — not surprise. That survey confirmed what many disability management professionals already understood. Employee mental health is a wellness concern as well as a compliance, engagement and cost issue.

Participants also discussed real-world limits in delivering mental health care through traditional health plans. Many providers still won’t accept insurance. Roughly half of all MH/SUD treatment is paid out of pocket and never submitted for reimbursement, often due to access challenges or lingering stigma.

Notably, there was broad agreement that employers should not be blamed for this breakdown in Mental Health Parity and Addiction Equity Act (MHPAEA) compliance, especially when network participation is low or out-of-network reimbursement isn’t feasible. The system is strained and compliance gaps often stem from structural issues, not a lack of compliance.

The Mental Health LTD Challenge: It’s Time to Rethink the 24-Month Cap

In a co-presentation with Mark DeBofsky of DeBofsky Law Ltd., Jack addressed a lesser-known and deeply impactful disparity in LTD coverage involving the widespread application of 24-month benefit limits for disabilities that are in part or wholly related to mental illness or substance use disorders (MH/SUD).

A super majority of all LTD plans apply this duration limit. By the time the limit applies, many individuals have confirmed their disability and have secured Social Security Disability Insurance (SSDI). Despite this, their LTD benefits are discontinued.

Some plan sponsors are starting to rethink this approach. Based on survey feedback from DMEC members shared during the session, a growing minority of employers have already removed the 24-month limit on disabilities that include MH/SUD conditions.

Actuarial estimates discussed during the presentation indicated that removing the cap would increase annual LTD premiums by less than $70 per participant for a median-wage worker – a one-time cost increase of 25 percent.

The alternative? Continuing the status quo could result in a reputational and employee-relations nightmare. Cutting off benefits from someone who clearly is still disabled — while representing support for mental health — is an obvious contradiction in messaging for employees. The impact goes beyond legal exposure and also damages trust, morale, retention and most importantly, engagement.

Jack and Mark made the case for acting now, whether or not the legislation or regulations catch up. The ERISA Advisory Council has already laid the groundwork with recommendations from 2012 and 2023. Employers can take advantage of these insights to strengthen their LTD offerings and protect both their employees and their brand.

aequum’s Perspective: Practical Solutions, Not Just Policy Talk

aequum understands that compliance and compassion aren’t mutually exclusive. We help employers and plan sponsors protect their plans and participants through:

• Legal and claims support for MHPAEA and LTD issues.
• Advocacy to resolve billing and reimbursement challenges.
• Transparent data and insights to inform smarter plan design.

What we heard at DMEC confirms the need for continued vigilance and innovation. There is no good reason for limiting mental health parity to compliance with health coverage mandates.

Contact aequum today to learn how to close gaps in your health or LTD plans.