UnitedHealth subsidiaries settle mental health parity allegations for $15.6M

UnitedHealth subsidiaries settle mental health parity allegations for $15.6M

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UnitedHealthcare and United Behavioral Health will pay $15.6 million to settle allegations that they illegally denied coverage for mental health and substance abuse disorder treatment.

The entities agreed to settle after the Department of Labor and Attorney General of the State of New York filed complaints alleging that they reduced reimbursement rates for out-of-network mental health services, thereby overcharging participants for those services.

Further, the Minnetonka, Minnesota-based companies employed arbitrary thresholds to trigger utilization reviews, which led to coverage denials, the complaints stated.

UnitedHealthcare and United Behavioral Health violated the Mental Health Parity and Addiction Equity Act of 2008, the Department of Labor said in a news release issued Thursday. The law prohibits health plans covered by the Employee Retirement Income Security Act from imposing treatment limitations on mental health and substance use disorder benefits that are more restrictive than the limitations they impose on medical and surgical benefits.

The companies also violated New York’s behavioral health parity law, which mirrors the federal law.

“In the shadow of the most devastating year for overdose deaths and in the face of growing mental health concerns due to the pandemic, access to this care is more critical than ever before,” said New York Attorney General Letitia James in a news release. “United’s denial of these vital services was both unlawful and dangerous — putting millions in harm’s way during the darkest of times.”

The companies will pay $13.6 million to affected participants and beneficiaries as well as a little over $2 million in penalties.

“We are pleased to resolve these issues related to business practices no longer used by the company,” said UnitedHealth Group, the parent company, in an emailed statement. “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.”

As part of the settlement, UnitedHealthcare and United Behavioral Health agreed to stop the violations, improve disclosures to plan participants and commit to future compliance.

The settlement comes less than a year after a federal judge ordered United Behavioral Health to reprocess about 67,000 illegally denied mental and behavioral health coverage claims. The judge also ordered the payer to change its handling of behavioral health claims and improve employee training.

Photo: Sarinyapinngam, Getty Images

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