A class action lawsuit filed last month in U.S. District Court on behalf of the New York State Psychiatric Association (NYSPA), which alleges that UnitedHealth Group violated federal and state mental health parity laws, applies to addiction treatment providers and patients as well, according to the lawyer handling the case. “The case also includes addiction treatments,” said D. Brian Hufford, with Pomerantz Grossman Hufford Dahlstrom & Gross LLP, the New York City–based firm filing the class action suit.

“Among other things, we allege that insurers cannot legally impose preauthorization requirements for outpatient services for mental health or substance abuse treatments, as doing so violates the parity laws,” said Hufford. “Similarly, applying medical necessity guidelines that are more strict for mental health or substance abuse than for medical/surgical care is impermissible.”

“Because of the nature of the specific claims relating to our current named plaintiffs, the primary allegations focus on mental health, but the overall claims apply to both types of treatments,” Hufford said.

And the National Association of Addiction Treatment Providers (NAATP) is paying attention — as it is to the still-unreleased final rule implementing the parity law. “Although we are not involved in this current suit, we are watching this case and the implementation process closely,” said Michael E. Walsh, president and CEO of the NAATP. “When we see or hear about issues with regard to potential parity violations, we encourage facilities and consumers to forward their concerns to the appropriate government agencies such as Health and Human Services.” Walsh told ADAW. “We are not alone in our concerns and have had conversations with many related associations whose members are also very concerned,” he said, adding, “We look forward to being a part of the solution.”

The NAATP is also asking members to communicate with the association when encountering potential violations “in order to assist them in getting their concerns to the appropriate parties,” said Walsh. “Our membership is very concerned with implementation, and a final rule is needed so that an enforcement mechanism is put in place.”

Seeking class recognition

The class action suit was brought on behalf of three people who are insured by plans administered or issued by United, and are seeking to represent a nationwide class. The NYSPA, which is a division of the American Psychiatric Association, is also seeking injunctive relief on behalf of its members and their patients.

The suit was also filed by Jonathon Denbo, Michael Kamins on behalf of his son, and Brad Smith on behalf of his son. Denbo said United stopped paying for psychotherapy late last year. Kamins said only two psychotherapy sessions a month were allowed for his son, although two a week were requested. United stopped paying for residential treatment for Smith’s son and instead required outpatient treatment.

Asked for a comment, United spokesman Daryl Richard said, “We are committed to helping people with mental health issues reach long-term recovery. We received the complaint and are currently reviewing.”

United is the country's largest health insurer and is subject to the Mental Health Parity and Addiction Equity Act of 2008 as well as New York parity laws, which prohibit insurance companies from imposing limitations on mental health and addiction treatment that are more restrictive than those applied to medical and surgical treatment.

According to the plaintiffs, “United has adopted insidious, multi-layered policies and practices that violate applicable parity laws and impose unjustifiable restrictions on mental health care.” In particular, United uses concurrent treatment reviews to limit and deny benefits prospectively for conditions that are “unpredictable.”

Grievances

The 100-page complaint details the grievances NYSPA has heard about stemming from United’s denials of mental healthcare. “Over the past year, NYSPA has attempted to work with United Healthcare and its affiliates to resolve some of the issues identified in the complaint, but those efforts were unsuccessful,” said Seth P. Stein, NYSPA's executive director and general counsel, in a statement when the suit was filed. “Enforcement of existing state and federal parity statutes is paramount to ensure that individuals with mental illness receive access to necessary and appropriate care and treatment.”

The suit alleges that people covered by United have difficulty in particular obtaining authorization for intensive outpatient treatment.

“The mental health parity laws are designed to prevent the very practices in which United has engaged,” Hufford said in a statement when the lawsuit was filed. “Through this action, we seek to compel United to change its restrictive approach to mental health care, while establishing uniform, industry-wide standards.”

Hufford and Pomerantz have a track record that may worry United in this case. In 2010, the Pomerantz firm negotiated a $350 million settlement with United for misusing the “usual, customary and reasonable” (UCR) rates in the Ingenix database to determine out-of-network reimbursements. Pomerantz is also the chair of the Plaintiffs’ Executive Committee in a multidistrict litigation pending against Aetna for similar practices. Pomerantz also played a role in a $249 million settlement of its UCR class action against Health Net in 2008.

Working with Hufford is co-counsel Meiram Bendat, founder of the California-based mental health insurance advocacy service Psych-Appeal. Bendat is a practicing psychotherapist and an attorney.

Hufford told ADAW that this kind of case takes a “long time” to wend its way through the courts. He urges any ADAW readers interested in the case to contact him at dbhufford@pomlaw.com.