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Mental Health Parity and Insurance


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For those suffering from mental health issues, undoubtedly you have also run across insurance issues. Your insurance provider does not approve treatment. Your insurance provider reduces the level of care prematurely. Does not approve certain treatment. And you are kept in the cycle of despair.

Some may question, but what about mental health parity? Wasn't the Mental Health Parity law passed in 2008? And what about the Affordable Care Act?

Yes, they exist. But, in essence what they did was to tell insurance companies, you are now in a football game. You are on one side. Families, patients and doctors are on the other side. Sometimes they play at your home field. Sometimes you play at their field. Ok, go.

With this, parity laws allowed insurance companies to decide the rules for the football game, not have to tell other side what those rules were, they got to appoint their own referees and replay officials, and they got to be the commissioner of the league.

That my be changing. On March 5, 2019, a US Magistrate Judge issued a 106 page ruling in a case involving United Behavioral Healthcare/Optum. This ruling eviscerated UBH and held that UBH insurance guidelines do not comply with the applicable standards of care, were deceptive since they were first run by the finance department in order to keep benefit expenses down. The UBH expert witnesses were deemed not credible. And UBH was found to have violated its duty of good faith to its insureds. 

The remedies stage is happening now. I have spoken with the plaintiffs' attorneys on a number of occasions. I set up a meeting with one of the attorneys and some of the most influential people in the eating disorder industry at a recent international conference held in NYC. The plaintiffs' attorneys will probably be asking the court to appoint an independent panel to implement guidelines which do comply with the generally accepted standards of care, to appoint an overseer to enforce those guidelines, the class members whose claims were denied can reassert their claims and the UBH guidelines will be thrown out.

They will also be asking for a pool of funds to be established so that class members can make claim for certain damages. Now, UBH/Optum make a net revenue of about $29 million ... PER HOUR! And yes, you read that correctly. So, you can imagine how large that pool could be.

The game is changing. And the rules of the game are now going to be decided differently.

Here are two articles I have written about the decision:

UBH/Optum Decision

Using the Optum/UBH Decision Now

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So how would this help someone recently denied coverage from a different carrier, say Cigna?

I have a relative recently denied coverage for a 30 day rehab stint for alcohol.  Also treated for depression, anxiety.

Based on the ACA can they not deny coverage?  Or does it depend on how the policy is written and then we'd have to threaten to sue based on the UBH decision?

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7 hours ago, Mach 1 said:

So how would this help someone recently denied coverage from a different carrier, say Cigna?

I have a relative recently denied coverage for a 30 day rehab stint for alcohol.  Also treated for depression, anxiety.

Based on the ACA can they not deny coverage?  Or does it depend on how the policy is written and then we'd have to threaten to sue based on the UBH decision?

I would first find a treatment center and get them to start to start the process of obtaining preauthorization. When this is denied, you instruct the case manager to demand a peer-to-peer review with the "independent" doctor the insurance company is using. You also have a right to the identity of this doctor. You find out the state that doctor is licensed in.

The issue that most treatment providers and insureds face is that they focus on the insured first. You need to attack their guidelines first. Get a copy of the policy. You will see that Cigna's guidelines probably do not comply with the generally accepted standards of care.

Then the issue becomes is the peer review doctor making recommended treatment decisions based upon guidelines that do not comply with the standard of care.

For the most part, the ACA is worthless and will not provide the remedies you need.

It is complex yes. But it is doable. And.. in talking with the attorney for the plaintiffs in UBH, his firm has been retained to go after Cigna now as well ... and BCBS.

You have not heard about the Wit case in the news yet because the remedies part of the case has not been resolved. When that decision is rendered, that is when it becomes hot news.

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8 hours ago, TwiceHorn said:

How likely is it to stand up on appeal?

Did they consent to magistrate jurisdiction or is it just a recommendation at this point/

Both parties consented to Magistrate jurisdiction. So, there is no appeal to the Article III judge.

The ruling is very meticulous. The trial occurred over 10 separate days in late October of 2017. This judge took over 15 months before the decision came out. Once the remedies portion of the trial is concluded, it would go to that "conservative bastion" of the 9th Circuit Court of Appeals. In other words, that appellate court is not going to overturn it.

As for the remedies, in addition to the new guidelines and oversight, I would not be surprised to see the plaintiffs' attorneys ask the court to set up a common fund from which the previously denied claims, if approved by the moderator for enforcement of those claims, could be paid. They may simply ask the court to order that UBH/Optum fund the plan in an amount equal to one day of their net revenue ... or $696 Million.

It's going to be interesting.

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7 hours ago, Lidig8r said:

Both parties consented to Magistrate jurisdiction. So, there is no appeal to the Article III judge.

The ruling is very meticulous. The trial occurred over 10 separate days in late October of 2017. This judge took over 15 months before the decision came out. Once the remedies portion of the trial is concluded, it would go to that "conservative bastion" of the 9th Circuit Court of Appeals. In other words, that appellate court is not going to overturn it.

As for the remedies, in addition to the new guidelines and oversight, I would not be surprised to see the plaintiffs' attorneys ask the court to set up a common fund from which the previously denied claims, if approved by the moderator for enforcement of those claims, could be paid. They may simply ask the court to order that UBH/Optum fund the plan in an amount equal to one day of their net revenue ... or $696 Million.

It's going to be interesting.

Sounds very fact-bound, so that's good for appeal.

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Always seemed bizarre to me that you preemptively take a flu shot or a wellness check or a colonoscopy and you get all kinds of coverage and reimbursements because you are actively preventing future, costly issues.  But you do the same think with your mental well-being and you get a middle finger from your insurance company.  What am I missing in terms of their hesitation?  I mean, the profits made on mental illness treatment down the road is nothing compared to the revenue on cancer, or blood disease, or end-of-life care.  What is their incentive for treating this like a pain in the ass?  Honest question.  

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22 hours ago, Lobo said:

Always seemed bizarre to me that you preemptively take a flu shot or a wellness check or a colonoscopy and you get all kinds of coverage and reimbursements because you are actively preventing future, costly issues.  But you do the same think with your mental well-being and you get a middle finger from your insurance company.  What am I missing in terms of their hesitation?  I mean, the profits made on mental illness treatment down the road is nothing compared to the revenue on cancer, or blood disease, or end-of-life care.  What is their incentive for treating this like a pain in the ass?  Honest question.  

Up until 2008, mental health did not have to be covered at all.

Their incentive is that it is a financially sound business decision to treat it like this. The majority of your claims for denial are going to come under group health plans. This means ERISA is the controlling statutory law. That means, no jury trials. It also means that you have to show that a decision to deny payment for treatment is "arbitrary and capricious." There are also fewer attorneys who have expertise in ERISA litigation.

Insurers can project the estimated costs of care for a type of treatment. They then project the life expectancy of those making claims. The can project the estimated legal costs to defend lawsuits and include an amount representing the probable amount they would have to pay for adverse judgments. And, it comes down to a business decision.

This despite the fact that with eating disorders, let's say, the ratio is 1:4. That is, aggressive treatment in accordance with generally recognized standards of care at the manifestation of the disease (1). is much more likely to result in a favorable outcome, and (2). If claims continue to be denied, the insurer is looking at spending 4 times the amount it would pay at the start of treatment.

But, when you factor in that 1 person dies every 62 minutes from an eating disorder, they gamble that the 1:4 ratio favors them.

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