UnitedHealth affiliates to pay $15.6M to settle mental health parity lawsuits
United Healthcare Insurance Co. and United Behavioral Health will pay more than $15.6 million to settle allegations that the companies violated the federal mental health parity law by overly restricting mental health coverage and reimbursement, the U.S. Labor Department and New York Attorney General’s Office announced Thursday.
The companies will pay $13.6 million to up to 135,000 patients who were wrongfully denied coverage or were overcharged for treatment since at least 2013. They also will pay nearly $2.1 million in penalties to settle private litigation and investigations by the Labor Department and New York Attorney General.
United Behavioral Health and United Healthcare, which administer Employee Retirement Income Security Act-covered health plans, allegedly made it overly complicated for members to access mental healthcare or substance use disorder treatment and reimbursed out-of-network care more restrictively compared to medical or surgical services.
“(The settlement) signifies another step in our efforts to make sure we are meeting the promise of (the Mental Health Parity and Addiction Equity Act) and the promise of parity,” Ali Khawar, acting assistant secretary for employee benefits security at the Labor Department, told reporters during a conference call Thursday. “One area of focus for us is in non-quantitative treatment limitations—we believe there are ongoing issues across the marketplace with compliance.”
UnitedHealth Group said in a statement that it is “pleased to resolve these issues related to business practices no longer used by the company.” It ensures all its members have access to care and that it reimburses providers consistent with the health plan contracts and state and federal rules, the company added.
United allegedly reduced their reimbursement rate for out-of-network, non-physician mental health providers by up to 35%, according to a complaint filed Wednesday by the Labor Department. That policy was far less strict for physicians providing medical and surgical care, investigators found.
The companies also used a more aggressive claims review program to limited mental health benefits compared to their review process for medical care, according to the complaint.
As part of the settlement, United agreed to stop those practices and be more transparent with its members.
Investigators hope that the settlement sends a message to other companies that aren’t complying with the parity law.
December’s Consolidated Appropriations Act will bolster their enforcement efforts, authorities said. The act, in part, required that plans document any onerous red tape or other administrative requirements that limit access to mental healthcare.
“The global pandemic revealed barriers for those who need mental health or substance abuse treatment,” Khawar said. “Our efforts today and our ongoing efforts to enforce parity are part of a broader approach to raise awareness and reduce the stigma around these issues.”