Psych-Appeal Files Lawsuit Against Anthem Over Mental Health Guidelines

Psych-Appeal has filed a class-action lawsuit against Anthem, Inc., alleging that the insurance giant and its wholly-owned claims administrator Anthem UM Services, Inc. wrongfully denied mental health treatment to insureds using overly restrictive internal guidelines.

The complaint was filed on behalf of two plaintiffs who were denied insurance coverage for residential treatment of their mental health conditions. It alleges that the companies violated the Employee Retirement Income Security Act (ERISA) by using coverage criteria for its mental health guidelines that are far more restrictive than generally accepted standards of care. In the complaint, the case challenges mental health guidelines that Anthem created internally and used until 2018, at which time Anthem began using guidelines developed by MCG Health, part of the Hearst Health network. The complaint also alleges that the companies’ criteria falls below accepted medical standards and violates the Federal Parity Act.

“For years, Anthem knowingly – and purposefully – used flawed criteria to say ‘yes’ or ‘no’ to coverage claims for patients who needed intensive and long-term residential care that could help achieve a full recovery,” said Meiram Bendat, founder of Psych-Appeal and co-counsel for the plaintiffs. “These acts were not only in violation of parity laws, but they unnecessarily and harmfully forced patients to make a Hobson’s choice – pay for the high cost of treatment themselves or receive no treatment at all.”

Last year, in a similar lawsuit brought by Psych-Appeal and Zuckerman Spaeder, a federal court found in Wit v. UBH that United Behavioral Health (UBH, operating as Optum) violated its ERISA obligations by denying behavioral health coverage to more than 50,000 individuals and skewing criteria to cover “acute” treatment, which is short-term or crisis-focused, instead of chronic or complex mental health conditions that often require ongoing care. The Wit decision has been lauded as a “turning point” by mental health advocates engaged in the struggle to achieve parity and end mental health discrimination.

Collins et al. v. Anthem, Inc. was filed in the U.S. District Court for the Eastern District of New York on April 29, 2020. The plaintiffs are represented by Psych-Appeal and Zuckerman Spaeder LLP.