UnitedHealthcare to pay $14.3M to customers denied mental health coverage, James says

The nation’s largest health insurer will pay approximately $14.3 million to consumers, including $9 million to more than 20,000 New Yorkers, to resolve allegations that it denied coverage or reduced the reimbursement of consumers' mental health and substance abuse benefits.

UnitedHealthcare reached the agreements with the offices of New York Attorney General Letitia James and the U.S. Department of Labor over the allegations that the insurer's policies illegally limited coverage of outpatient psychotherapy, hindering access to these vital services for hundreds of thousands of New Yorkers.

"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," James said in the 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."

New York's behavioral health parity law, enacted as "Timothy's Law" in 2006, and the federal Mental Health Parity and Addiction Equity Act of 2008 require insurance coverage for mental health and substance use disorder treatment to be "no more restrictive" than insurance coverage for physical health conditions, according to the announcement by James. That announcement said UnitedHealth "penalized" thousands of New York members by making them "pay more than they should have" for some services and said the provider employed "arbitrary thresholds" to limit and deny treatment sessions.

In a statement Thursday, the UnitedHealth Group said: "We are committed to ensuring all our members have access to care and to reimbursing providers consistent with the terms of the member’s health plan and state and federal rules. We are pleased to resolve these issues related to business practices no longer used by the company. 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."

James said in addition to the payment to impacted consumers, United will lift the barriers it imposed and pay more than $2 million in penalties, with $1.3 million going to New York State.