Class action lawsuit against UnitedHealthcare
On May 23rd 2014 Bloomberg BNA published the article “Class Action Compliant: UnitedHealthcare Violated Federal Mental Health Parity law”. According to the article a class action complaint alleges that UnitedHealthcare Insurance Co. and United Behavioral Health (both part of the UnitedHeath Group Inc) “systematically and improperly” denied claims for mental health and substance-abuse related health benefits in violation of federal mental health parity law.
According to the complaint, these benefit denials were motivated by a desire to avoid the “often high costs associated with the treatment of chronic conditions.”
The complaint, filed on 21st May in the U.S. District Court for the Northern District of California, seeks class treatment for three proposed classes of health plan participants and beneficiaries who were denied insurance coverage for nutritional counselling or for residential treatment for mental health or substance use disorders.
A spokesperson for UnitedHealthcare told Bloomberg BNA that the company was currently reviewing the complaint.
The complaint was filed by three individuals who had been denied coverage for mental health and/or substance abuse treatment by Employee Retirement Income Security Act-governed health plans administered by UnitedHealthcare.
They accused the insurer of violating the federal Mental Health Parity and Addiction Equity Act of 2008 in two broad ways.
First, they alleged that UnitedHealthcare routinely violated plan terms covering mental health benefits by adjudicating claims “based on internal practices and policies that are much more restrictive than those generally accepted by the mental health community.”
Second, they argued that the insurer violated the federal parity act by imposing “disparate and more restrictive internal policies and practices” to claims for mental health and substance abuse benefits.
According to the plaintiffs, UnitedHealthcare's internal policies effectively provided that coverage would be denied for residential treatment if a lower level of treatment would be safe, regardless of whether it would be similarly effective. Further, they contended that the internal guidelines focused on “acute changes” in claimants' circumstances and failed to properly account for “chronically severe impairments.”
The plaintiffs argued that the guidelines showed that coverage for residential treatment would be denied unless a claimant could show that he or she would imminently suffer a “significant deterioration in function.” These “restrictive” guidelines discriminate against patients with mental illness, the plaintiffs asserted, because they weren't imposed upon patients seeking coverage for medical or surgical benefits. Further, they weren't in line with generally accepted standards for assessing appropriate levels of mental health care, the plaintiffs argued.
The complaint was filed by Psych-Appeal Inc., Zuckerman Spaeder LLP and the Maul Firm P.C.
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