United Healthcare Class Action Says Therapy Reimbursement is Limited

United Healthcare Insurance Co. faces a class action lawsuit accusing the company of wrongfully limiting coverage for psychotherapy services provided through employee health care plans.

According to the United Healthcare class action, United implements a policy which pays only a small portion of a psychotherapy bill at a rate determined by the therapist’s credentials.

The insurance company allegedly pays only a small amount to master’s level therapists and even less to certified psychologists. As United reportedly only covers a small portion of the bill, the rest of the cost falls on the consumers.

The United psychotherapy class action claims that this policy is in violation of the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 and the Affordable Care Act’s provider anti­-discrimination mandate, both of which have been incorporated into the Employee Retirement Income Security Act (ERISA).

“Despite the critical importance of office-­based psychotherapy to the health of plan participants and beneficiaries who suffer from mental illness or substance use, and defendants’ legal obligation to ensure compliance with ERISA’s anti-discrimination provisions, defendants have imposed and continue to impose reimbursement penalties on claims for coverage for psychotherapy services rendered by psychologists and master’s level counselors (and thus on the lion’s share of psychotherapy and office-­based mental health treatment),” the United Health class action states.

The United therapy class action is led by a Philadelphia woman, operating under the pseudonym Jane Smith, who received insurance coverage by United through her employer.

Smith received psychotherapy with a licensed clinical social worker to treat her post-traumatic stress disorder but was shocked when United only covered $61.86 of her $120 therapy sessions. She reportedly filed several appeals urging United to reconsider and contesting their allegedly illegal reimbursement policy, but each of her appeals were denied.

Smith claims that United’s reimbursement policy is arbitrary and imposed unfair penalties on certain therapists and psychologists.

“Through these penalties, United is devaluing psychotherapy and is ultimately limiting access to an essential health benefit that plays a critical role in addressing pervasive public health issues, such as mental health and substance abuse disorders,” an attorney for Smith said in a statement.

Smith seeks to represent a Class of participants or beneficiaries in ERISA plans whose claim(s) for psychotherapy and behavior health services provided by out-of-network psychologists or master’s level counselors were subject to United’s Discriminatory Reimbursement Penalty.

The United psychotherapy class action seeks an order directing United to pay or reprocess all wrongfully denied claims as well as equitable relief including disgorgement and restitution, court costs, and attorneys’ fees.

The proposed Class is represented by D. Brian Hufford, Jason S. Cowart, Shawn P. Naunton, Anant Kumar and Nell Z. Peyser of Zuckerman Spaeder LLP; Meiram Bendat of Psych­Appeal Inc.; and John W. Leardi, Vincent N. Buttaci, and Paul D. Werner of Buttaci Leardi & Wearner LLC.

The United Psychotherapy Class Action Lawsuit is Smith, et al. v. United Healthcare Insurance Co., et al., Case No. 3:18­-cv­-06336, in the U.S. District Court for the Northern District of California.