A.G. Schneiderman announces settlement with heath care insurer for wrongfully denying mental health treatment claims

By WBNG News

A.G. Schneiderman announces settlement with heath care insurer for wrongfully denying mental health treatment claims

January 15, 2014 Updated Jan 15, 2014 at 12:31 PM EST

(WBNG Binghamton) After an investigation uncovered the wrongful denial of hundreds of claims for nutritional counseling for mental health conditions, New York Attorney General Eric T. Schneiderman on Wednesday announced that his office has reached a settlement with Cigna Corporation, requiring the health insurer to reprocess and pay hundreds of claims for nutritional counseling for mental health conditions, in particular eating disorders, to members who were wrongfully denied those benefits.

According to a news release from Schneiderman's office:

Under the terms of the settlement, the company agrees to comply with Timothy’s Law, New York legislation enacted in 2006 and named for a 13-year-old Schenectady boy who committed suicide after an insurance company denied ongoing coverage for treatment of serious mental health issues, including hospitalizations.

“State law clearly requires health insurance companies to provide mental health benefits on par with other medical benefits. There is no gray area here,” Attorney General Schneiderman said. “Today’s settlement puts insurance companies on notice: My office will aggressively enforce mental health parity laws and fight to give patients the benefits they are legally entitled to – and which they pay for.”

Attorney General Schneiderman’s Health Care Bureau launched an investigation into Cigna’s administration of mental health benefits following the receipt of a complaint, in 2010, from the family of a then 14-year-old girl living in New York City who suffers from anorexia nervosa. The consumer complained that Cigna, which rejected all but three of her claims, had improperly denied coverage for nutritional counseling necessary for her mental health treatment.
The company denied the benefit citing a limit of three visits per calendar year limit. Rather than jeopardize her health by stopping treatment, the consumer's family continued the treatment, paying $2,400 out of pocket.

The settlement, the first one resulting from an ongoing probe into New York health insurance companies’ compliance with mental health parity laws, found that, since 2010, Cigna has denied more than 300 sessions of nutritional counseling to about 50 downstate members with mental health conditions, mostly eating disorders, on the grounds that the members exceeded the three-visit limit. As a result, these members were forced to pay a total of approximately $33,000 out of pocket for this necessary treatment. While limiting nutritional counseling to three visits for behavioral health, Cigna, a global company with a nearly $30 billion in annual revenues, did not limit nutritional counseling visits for members with diseases outside the behavioral health realm – for example, for patients with diabetes.

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