What To Do When An Insurance Company Denies Your Mental Health Claim

While federal and state laws require insurance companies to cover mental health and substance use disorder treatment, many people face an uphill battle in getting insurance companies to authorize treatment for mental health. From complicated policies to overly restrictive thresholds for medical necessity and lengthy waiting periods, affordable behavioral care can be nearly impossible to find. With more individuals experiencing the negative mental health and substance abuse consequences brought on by the pandemic, accessibility to treatment is more critical than ever. Fortunately, there are some steps you can take if you find yourself in the unfortunate but common position of being denied coverage.

To help you get access to the treatment you deserve, we interviewed Brian Hufford—a renowned attorney focused on healthcare law who recently led and won the landmark class-action lawsuit Wit vs. United Behavioral Health (UBH). Brian and his team successfully proved that UBH wrongfully denied over 50,000 mental health-related claims, which resulted in UBH being ordered to reprocess the claims. An abbreviated transcript of our conversation follows:

Brian, can you first tell us a little bit about yourself and what lead to your interest in healthcare law?

I grew up in Dodge City, Kansas, where my father was the director of a residential treatment facility for boys (called Methodist Youthville, or known locally as the “Boy’s Ranch”), and my mother was the educational director. Along with my older brother and sister, we lived in a house on the campus outside of town, so I really grew up with the boys, playing touch football and basketball, and going on a number of camping trips or visiting amusement parks. As a result, I saw how kids from troubled backgrounds and with emotional issues could really benefit from caring people who provided them services they could not receive at home. At the time, I didn’t really appreciate the mental health aspects or the nature of the treatments they were receiving, of course, but I felt a connection to health care issues as a young attorney.

Can you share a memory from when you were first starting out?

After law school, I worked for a large corporate firm before deciding that I really felt more comfortable as a plaintiff’s lawyer, representing the little guy against corporations. After becoming a partner in a firm that mainly did securities fraud class actions, I started looking for other types of cases where I had a more personal commitment.

I got involved in healthcare after pursuing a claim for one of my sons, where the insurance company refused to provide full coverage and then withheld information as to why they were doing so. That led to one of my first substantial cases. A few years later, I was contacted by an attorney about a potential mental health case, including improper denials of coverage for residential treatment, and I felt a connection back to my childhood. I really feel like we are making important changes in people’s lives when we help them get the care they need for themselves or their children.

How is it possible that some insurers continue to cover behavioral health services differently than they would physical health conditions, despite mental health parity laws?

The Federal Parity Act was originally passed back in 1996, and then amended and expanded in 2008, to ensure that there was no discrimination against patients who needed behavioral health services. The Act made a substantial impact in removing numerical limits on coverage, such as limiting treatment to a set amount per year, for example, or imposing extra costs on behavioral health services compared to medical/surgical.

As a result, however, insurers became more creative, including relying on internal guidelines for making medical necessity decisions. These internal guidelines were deliberately more restrictive than what would be considered industry standard, such as those promulgated by the American Society of Addiction Medicine (ASAM) criteria. While the Parity Act technically would prevent the use of guidelines that applied different standards, proving the guidelines are different is very hard to do. Knowing this, the insurers decided to be more restrictive in allowing access to care.

With so many people struggling to get coverage, what is the first step someone should take if their insurance company denies mental health treatment?

The most critical message I would share with patients or their families is not to give up. They need to be aggressive in pushing for care. Among other things, they need to appeal any denial, and they should push for their providers to help them in this process. Some plans only require one appeal, while others provide for two. Under ERISA, insured people have a legal right to get a “full and fair” review and they have to complete the appeal process if they are going to retain the ability to sue, if the denial continues.

How does the appeal process work?

The appeal process gives the insured, along with the providers, the opportunity to challenge denials of coverage, or reductions in payments. Under ERISA, the claimants can ask for information that will help their claim, including copies of any documents, policies, procedures, or guidelines that are relied upon in making the benefit determination.

Aside from asking for the underlying documentation, the claimant should also work with the provider to present the most compelling argument that the services in question are medically necessary. If a denial was based on a medical judgment (such as medical necessity or the application of the experimental/investigational exclusion), the insurer must consult with a medical expert with experience and training in treating the underlying health condition, which the claimant should demand.

Are there other ways people can advocate for mental health parity? What resources are available?

If you have a good story to tell, go to the media. Behavioral health is an important issue, and particularly in light of the shutdown resulting from the pandemic, mental health issues and substance use disorders are rising, creating national recognition of the need to get things done. So using the press can be very helpful.

In addition, there are many organizations out there to help people in need. One of the best is the Kennedy Forum, which was founded by Patrick Kennedy, who was the original sponsor of the 2008 Federal Parity Act while he was a Congressman from Rhode Island. The Kennedy Forum’s goal is to advocate for parity in how we treat mental illness and substance use disorder, while pushing for greater resources to provide the treatment that so many need. A terrific resource for those trying to challenge denials is the Kennedy Forum’s Parity Registry (parityregistry.org), which has links about your rights, how to submit your complaint, and getting assistance with filing an appeal.

Finally, you can go to the regulators, including the Department of Labor, which has primary responsibility for overseeing ERISA plans. You can file a complaint with the DOL through this site: https://www.dol.gov/agencies/whd/contact/complaints. You can also contact your state insurance department.

You are most well-known for Wit vs. UBH and for fighting for people’s access to behavioral health services. Can you tell us a little bit more about the case?

In Wit, we sued United Behavioral Health—a UnitedHealth Group subsidiary, and the nation’s largest behavioral health administrator—for relying on overly restrictive internal guidelines that were inconsistent with generally accepted standards of care. In essence, these guidelines were focused on addressing acute outbreaks that might lead a patient to seek care, rather than the underlying and chronic conditions the caused the problem in the first place. So United would treat the patient on a short-term basis to get them through the acute phase, and then push for reduced levels of care.

Suing under ERISA, the federal statute that governs private employer benefit plans, we argued that this practice was contrary to the insurance plans, which required complying with generally accepted standards of care, including by treating the chronic conditions. We succeeded in getting a nationwide class of insureds whose claims had been denied by UBH based on the guidelines and took it to trial. We won in a critically important decision that found that UBH had violated its fiduciary duties to its members.

What were the results of the court’s decision?

The Court adopted a significant remedy which, among other things, ordered UBH to adopt new and proper guidelines that had been adopted by independent provider organizations, to train its own people on using these new guidelines and on what it means to be a fiduciary, and to go back and reprocess over 67,000 claims of class members that had been improperly denied based on the flawed internal guidelines. The court further appointed a Special Master to oversee UBH’s implementation of the court’s order, and established that the injunctive relief would last for up to ten years, so that there was sufficient oversight to ensure UBH’s compliance.

United is now appealing the decision to the Ninth Circuit Court of Appeals, which will be heard in August. We are confident that we will win that appeal, particularly given how detailed and thorough the Judge’s decisions were, but the decision will not be final until the appeal is resolved.

What other issues are you currently investigating?

Because of my work, I frequently get called by families or providers seeking help, due to what they believe to be abuses of the insurance industry in refusing to cover behavioral health services properly. One of the areas for which I receive many complaints relates to inadequate networks, in which insureds have a very difficult time finding in-network providers who have time and experience to treat their needs. Based on what I have seen and heard, I firmly believe that this problem is caused in large part by the inadequate reimbursement paid by most insurers for behavioral health providers.

In particular, studies have shown that, on a relative basis (such as by comparing payments to Medicare rates), insurers generally pay in-network behavioral health providers far less in comparison to medical/surgical providers. The result is an inadequate network, where patients either cannot find in-network providers, and thereby have to pay far more out-of-pocket to go out-of-network, or they are forced to take young and inexperienced providers who may not have experience in conditions the patients suffer from. This is unacceptable and needs to be addressed, whether through private litigation in a Parity Act claim or through far more proactive regulators, including the DOL, who must work to ensure that those requiring behavioral health services are not discriminated against.

About Brian Hufford:

Brian Hufford is a partner at Zuckerman Spaeder LLP and leads their healthcare insurance practice. Hufford represents patients and health care providers in high-stakes disputes with health insurance companies. Among other recognitions, he has been named a Law360 “MVP” for Health Care (2015, 2016, and 2017) and Benefits (2019) and was chosen as a Plaintiff’s Attorney “Trailblazer” in 2017 and 2021 by The National Law Journal. To learn more, visit: D. Brian Hufford | Zuckerman Spaeder LLP