Philip Seymour Hoffman 1967-2014
Serious mental health and addiction problems affect millions of Americans and when untreated lead to more suffering, costly medical treatment and social problems. These problems are found in individuals and families of all walks of life and at all ages. In addition, when untreated, these problems are often associated with serious accidents, injuries, suicide, disabilities, homelessness, lost jobs, divorce, child neglect, physical and sexual abuse, domestic violence, DWIs and other crimes.
A major issue, with people who experience major mental health and addiction problems, is that they often are impaired, to the extent that they don’t seek help early enough. Their problems are made significantly worse, when millions of people, who are seeking treatment and have paid for their insurance coverage, are denied access to treatment services.
NYS Investigates Claims of Insurer Discrimination
The NYS AG’s office has aggressively investigated health insurance companies operating in New York that have had long-standing complaints and discriminatory practices. These insurers sell policies to public and private employers and individual policies including Medicare Advantage plans that include mental health and addiction treatment benefits.
However, at the same time, they have restricted and denied coverage and claims as “not medically necessary” at substantially higher rates than other medical services. The AG investigations identified a number of common administrative deficiencies including inadequate compliance systems consistent with state and federal parity laws, rules, regulations and professional standards.
AG Schniderman Sanctions Five Insurers over $3 million for widespread Discriminatory Denials of Behavioral Health Treatment Services
Following numerous complaints from mental health and drug treatment professionals, patients, parents and advocates over decades, the Attorney General’s investigations revealed that Value Options, a privately owned for-profit company; Excellus, MVP and Emblem Health, which are all non-profit insurers; and CIGNA, a national for-profit insurer, all participated in widespread discriminatory practices.
As a result, the NYS AG Eric Schniderman has sanctioned these five insurers in 2013-14, for over $3 million collectively in penalties and also required them to eliminate their discriminatory policies and procedures.
In addition, these insurers are being held liable for the outcome of thousands of independent reviews of denied treatment claims. This review represents potentially millions of dollars of denied claims, over a period of years that could be reversed.
Longstanding Discriminatory Practices
How did these discriminatory practices occur? These insurers established a series of policies such as: requiring their own contracted, licensed specialty providers to submit requests for certain services to be subjected to pre-authorized service reviews and approvals; establishing treatment service limits, independent of medical diagnoses or histories; requiring subscribers to pay higher co-pays/coinsurance for services; requiring that that subscribers first fail in less cost treatment modalities such as outpatient services before inpatient services are approved, and routinely denying certain established modalities such as licensed residential treatment.
Insurance Gatekeepers Restrict Access to Needed Services
Insurance companies often allocate substantial resources from premiums paid for by subscribers, employers, and taxpayers for ‘utilization review management’ and other “gatekeeper” functions to control mental health and addiction treatment expenses.
Many insurers hire personnel to perform these gatekeeper tasks internally and others like MVP and Emblem Health (which are non-profits) contract with firms, such as ValueOptions, a Virginia- based, national for-profit business that generates $1.3 billion annually in revenue. According to the NYSAG’s report (No. 14-176, p2), ValueOptions received $95 million in revenue for its Emblem and MVP business in 2013.
Employers and subscribers paid substantial premiums for insurance that covered mental health and addiction treatment for years, but they were systematically restricted and denied access to services when they needed help the most. And, federal and state funders, regulators, and independent accrediting organizations ignored what was going on.
Congratulations to NYSAG Schneiderman and his Health Care Bureau for their comprehensive investigation and settlement with New York insurers who employed long-standing discriminatory practices against thousands of private and public employers and plan subscribers who were seeking mental health and addiction treatment.
Hopefully, this practice will end as insurers, regulators and accrediting organizations realize that future disregard of federal and state mental health parity laws will not go unnoticed and they will be held accountable.
Detailed reports of the NYS AG’s investigations and assurance settlement plans with these 5 insurers can be found at:
NYS OAG Health Care Bureau
ValueOptions Assursance No. 14-176
Emblem Health – Assurance No. 14-031
MVP Health – Assurance No. 14-006
Excellus Health – Assurance No. 14-201
Cigna – Assurance No. 13-474