- Landmark Case Challenges the Nation’s Largest Mental Health Insurance Company for Unlawful, Systematic Claims Denials – and Wins
- Groundbreaking Ruling Affects Certified Classes of Tens of Thousands of Patients, Including Thousands of Children and Teenagers
- Judge Rules, “At every level of care that is at issue in this case, there is an excessive emphasis on addressing acute symptoms and stabilizing crises while ignoring the effective treatment of members’ underlying conditions.”
In a landmark mental health ruling, a federal court held today that health insurance giant United Behavioral Health (UBH), which serves over 60 million members and is owned by UnitedHealth Group, used flawed internal guidelines to unlawfully deny mental health and substance use treatment for its insureds across the United States. The historic class action was filed by Psych-Appeal, Inc. and Zuckerman Spaeder LLP, and litigated in the U.S. District Court for the Northern District of California.
The federal court found that, to promote its own bottom line, UBH denied claims based on internally developed medical necessity criteria that were far more restrictive than generally accepted standards for behavioral health care. Specifically, the court found that UBH’s criteria were skewed to cover “acute” treatment, which is short-term or crisis-focused, and disregarded chronic or complex mental health conditions that often require ongoing care.
The court was particularly troubled by UBH’s lack of coverage criteria for children and adolescents, estimated to number in the thousands in the certified classes.
“For far too long, patients and their families have been stretched to the breaking point, both financially and emotionally, as they battle with insurers for the mental health coverage promised by their health plans,” said Meiram Bendat of Psych-Appeal, Inc. and co-counsel for the plaintiffs who uncovered the guideline flaws. “Now a court has ruled that denying coverage based on defective medical necessity criteria is illegal.”
In its decision, the court also held that UBH misled regulators about its guidelines being consistent with the American Society of Addiction Medicine (ASAM) criteria, which insurers must use in Connecticut, Illinois and Rhode Island. Additionally, the court found that UBH failed to apply Texas-mandated substance use criteria for at least a portion of the class period.
The legal opinion is here.