UnitedHealthcare gets much of lawsuit over denial of mental health coverage tossed

UnitedHealth Group’s corporate logo is displayed on the side of one of its office buildings in Santa Ana, California, U.S., April 13, 2020. REUTERS/Mike Blake

(Reuters) – A federal judge has slashed a proposed class action lawsuit by mental health and addiction treatment providers who accuse a UnitedHealthcare unit of denying coverage for medically necessary treatment.

US District Judge Jeffrey White in Oakland, California, on Wednesday thrown off all claims on health plans governed by federal employee benefits law and wrote that plaintiffs “may face an uphill battle” with the remaining claims.

UnitedHealthcare and its attorney did not immediately respond to a request for comment.

“We look forward to pursuing our claims regarding the state law plans,” said Matthew Lavin of Arnall Golden Gregory, an attorney for the providers, adding that he and his clients continue to review the decision.

In their 2019 lawsuit, the providers – Florida-based Meridian Treatment Solutions, California-based Harmony Hollywood and Arizona-based Desert Cove Recovery – said UnitedHealthcare determined what treatment was “medically necessary” using internal guidelines “for the purposes of profit” that were not based on generally accepted medical standards.

His lawsuit is similar to a case brought against the insurer by patients, who faced a setback last month when the US Court of Appeals for the 9th Circuit reversed a district judge’s decision. decision that UnitedHealthcare’s guidelines were unreasonable. The patients, who have support from the federal government, have said they plan to seek a new full hearing in the case.

White found Tuesday that all claims stemming from plans governed by the Employee Retirement Income Security Act (ERISA) were superseded by federal law. He also reduced the claims stemming from the non-ERISA plans, dismissing the misrepresentation and concealment claims as lacking sufficiently detailed support, although the plaintiffs will have the opportunity to re-argue them.

In dismissing another claim under California’s Unfair Competition Law, the judge said it “depends heavily” on the findings in the case of the patients recently rejected by the Ninth Circuit.

The ruling left the breach of implied and oral contract claims standing, though White said that, based on past cases, it might be difficult to establish that communications between the providers and the insurer had created any contract that could be breached.

The case is Meridian Treatment Services et al v. United Behavioral Health, US District Court, Northern District of California, No. 4:19-cv-05721.

For Plaintiffs: Matthew Lavin and Aaron Modiano of Arnall Golden Gregory and David Lilienstein and Katie Spielman of DL Law Group

For UnitedHealth: Geoffrey Sigler and Nicole Matthews of Gibson Dunn Crutcher

Read more:

DOL, California supports mental health patients against UnitedHealth

UnitedHealth unit must reprocess more than 50,000 denied mental health claims

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