New Directions, Blue Cross Sued Over Mental Health Coverage

New Directions Behavioral Health LLC wrongly limits coverage for residential mental health treatments by using flawed internal criteria for gauging medical necessity, according to a proposed class action filed in the Middle District of Florida.

The Sept. 5 lawsuit was filed by a woman with Blue Cross Blue Shield of Florida health insurance, whose 20-year-old daughter suffers from anorexia. The woman claims Blue Cross and New Directions—which administers mental health benefits for Blue Cross and other insurers—repeatedly denied coverage for residential treatment of behavioral health disorders by using medical necessity criteria that aren’t consistent with generally accepted standards of medical ...