UPDATE 1-NY State Psychiatric Assn sues UnitedHealth over benefits

Mon Mar 11, 2013 2:28pm EDT

March 11 (Reuters) - The New York State Psychiatric Association and consumers with health insurance from UnitedHealth Group Inc on Monday sued the company over mental health benefits, saying it had not provided the treatments that federal and state laws require.

The suit, which seeks class action status on behalf of the psychiatric association's members and other health insurance customers, seeks to compel UnitedHealth to comply with the law and cover mental healthcare and seek financial losses.

UnitedHealth is the nation's largest health insurance company. A spokesman did not have an immediate comment.

The New York State Psychiatric Association, the New York division of the American Psychiatric Association, said in the suit it had received many complaints about UnitedHealth's policies that eliminate, reduce and discourage mental healthcare.

It said that it requires strict medical criteria and preauthorizations that it does not place on primary medical care, whereas the law requires parity. The suit says the company violates the Federal Parity act, ERISA rules, the Affordable Care Act, New York state laws, and other laws.

The National Institute of Mental Health estimates that 5 percent of Americans have a serious mental illness, while an estimated 26 percent of Americans ages 18 and older - about one in four adults - suffer from a diagnosable mental disorder in a given year.

As these numbers show, the majority of mental illnesses are mild to moderate, such as moderate depression or anxiety, rather than severe, such as schizophrenia or psychosis.

In 2006, the last year for which complete data are available, 36.2 million people paid for mental health treatment, for a total expenditure of $57.5 billion. Of those, 4.6 million were children, whose mental health services cost $8.9 billion.

The suit was also filed by Jonathan Denbo and Michael Kamins on behalf of his son, and Brad Smith on behalf of his son.

Jonathan Denbo receives health benefits through his employer, CBS Sports Network, according to the documents. The plan is administered by UnitedHealth, which Denbo said cut off reimbursement to psychotherapy in late 2012.

Kamins, who was part of a plan offered by the New York State Health Insurance Program, said that the insurer imposed substantial obligations on his son in order to obtain preauthorization for appointments. It permitted only two sessions per month rather then two sessions per week requested.

Smith receives benefits through SYSCO Corp, for which UnitedHealth is the plan administrator. His 17-year old son has received mental health benefits since 2005 and in 2012 was hospitalized. After initially paying for residential treatment, the company stopped and required outpatient services.

The case is in Re: New York State Psychiatric Assn Inc, Michael A. Kamins, Jonathan Denbo and Brad Smith vs UnitedHealth Group, Southern District of New York, No. 13-cv-01599.

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