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UnitedHealthcare Inks Settlement Over Mental Health Coverage (4)

Aug. 11, 2021, 7:00 PMUpdated: Aug. 12, 2021, 4:44 PM

United Healthcare Insurance Co., United Behavioral Health, and Oxford Health Insurance Inc. will collectively pay more than $15.6 million to settle allegations they violated the federal mental health parity law.

The companies will pay $10 million to resolve claims by government and private litigants, $2.5 million to resolve claims brought by the Labor Department, and $1.1 million for claims brought by the New York attorney general, and over $2 million in penalties, according to two settlement agreements filed Wednesday in the U.S. District Court for the Eastern District of New York.

The companies, which administer employer-sponsored health plans, are accused of systematically reimbursing out-of-network mental health services more restrictively than they reimburse out-of-network medical or surgical services.

Under the Mental Health Parity and Addiction Equity Act (MHPAEA), mental health treatments must be covered on the same terms as medical and surgical benefits.

“Enforcing the mental health parity law is a very high priority for the Department of Labor and this administration,” Ali Khawar, acting assistant secretary for the Employee Benefits Security Administration (EBSA), said at a press briefing Thursday.

“The secretary of labor views this as probably our top health enforcement priority for EBSA,” he said. “It does signify another step in our efforts to make sure we’re meeting the promise of MHPAEA and the promise of parity.”

In a company statement, UnitedHealth Group said it is “committed to ensuring all our members have access to care and to reimbursing providers consistent with the terms of the member’s health plan and state and federal rules.”

“We are pleased to resolve these issues related to business practices no longer used by the company,” the company said. “As part of our broader commitment to quality care, we continue to support our members with increased access to providers and new ways to get the effective behavioral support they need.”

Cut Rates

According to a complaint filed Wednesday by the Labor Department, the companies cut their baseline reimbursement rates for out-of-network, non-physician mental health providers by as much as 35%, while imposing similar reductions on non-physician medical and surgical providers only in “limited circumstances.”

They also use a concurrent review program to limit benefits for outpatient mental health benefits in a way that’s “broader and more aggressive” than programs in place for similar medical and surgical benefits, the department said.

In December, Congress gave the Labor Department new tools as part of the Consolidated Appropriations Act to advance the cause of mental health parity, and the agency is vigorously making sure it’s making use of those tools, Khawar said Thursday.

“You should expect to see more investigations,” he said. “We have taken a look at our existing inventory of cases and have sent out a number of letters asking for plans and issuers to provide their non-quantitative treatment limitation analyses, and that work is ongoing right now. There are other investigations that are open, and I predict it will be a very active issue for us for years to come.”

The companies are accused of violating both the mental health parity law and the Employee Retirement Income Security Act, which sets standards for employer-sponsored benefit plans.

The case is Walsh v. United Behavioral Health, E.D.N.Y., No. 1:21-cv-04519, 8/11/21.

(Updates Aug. 11 story with comment from UnitedHealth Group in paragraphs seven and eight.)

To contact the reporters on this story: Jacklyn Wille in Washington at jwille@bloomberglaw.com; Lydia Wheeler in Washington at lwheeler@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Peggy Aulino at maulino@bloomberglaw.com; Brent Bierman at bbierman@bloomberglaw.com

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