SAN FRANCISCO (Legal Newsline) - United Healthcare is being sued by customers who allege it denied claims for mental health and substance abuse-related health benefits and violated the Mental Health Parity and Addiction Equity Act of 2008.
United Healthcare and United Behavioral Health "systematically and improperly" denied mental health and substance abuse-related insurance benefit claims based on internal policies and practices that violated health insurance plans and the federal parity act, it is alleged.
The defendants' "unlawful motives are clear--to save the often high costs associated with the treatment of chronic conditions," according to a complaint filed May 21 in the U.S. District Court for the Northern District of California.
David Wit, his daughter Natasha Wit and Brian Muir have insurance policies with the defendants and claim they have been denied coverage for mental health and/or substance abuse treatment by the Employee Retirement Income Security Act, which governs health plans administered by United Healthcare.
The plaintiffs claim United Healthcare 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."
United Healthcare also 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 suit.
The plaintiffs claim United Healthcare'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.
The defendant's guidelines condition coverage for residential mental health treatment on "acute changes" in claimants' circumstances and do not provide for any consideration of chronically severe impairments that similarly warrant residential care, according to the suit.
The plaintiffs claim the defendants' restrictive guidelines discriminate against patients with mental illness because they are not imposed upon patients seeking coverage for medical or surgical benefits.
"United issues and administers many other fully-insured health insurance plans that define covered mental health services in the same way as the Wits' Plan," the complaint states. "The policies, practices and decisions that United made with respect to the claims filed by the Wits are the same as those that have been applied by United to other similarly situated insureds seeking mental benefits under their fully-insured health plans."
United also serves as the claims administrator for many other self-insured health plans that define covered substance abuse services in the same way as Muir's Plan, according to the suit.
"The policies, practices and decisions that United made with respect to the claims filed by Muir are the same as those that have been applied by United to other similarly situated insureds seeking substance use benefits under their self-insured health plans," the complaint states.
The plaintiffs are seeking class certification and an order for United to recalculate and issue unpaid benefits to members of classes whose claims were underpaid or denied as a result of United's actions. They are being represented by Meiram Bendat of Psych-Appeal Inc.; D. Brian Hufford and Jason S. Cowart of Zuckerman Spaeder LLP; and Anthony F. Maul of the Maul Firm PC.
U.S. District Court for the Northern District of California case number: 3:14-cv-02346
From Legal Newsline: Kyla Asbury can be reached at firstname.lastname@example.org.