AG Coakley Tells National Health Insurance Companies to Comply with Required Mental Health Benefits
AG Coakley Sends Letter to America’s Health Insurance Plans Emphasizing Importance of Mandated Mental Health and Other Coverage in Massachusetts; AG’s Office has Recovered Millions of Dollars from Companies Failing to Provide Required Health Coverage
BOSTON – Following several years of legal action against insurance companies that failed to cover required mental health services and other mandated benefits for consumers, Attorney General Martha Coakley is urging the industry to ensure compliance with state law.
In a letter sent Thursday to America’s Health Insurance Plans (AHIP), AG Coakley highlights that numerous national carriers have failed to comply with Massachusetts laws requiring coverage of necessary mental health services. Just last month, the AG’s Office entered a $625,000 settlement with United States Fire Insurance Company (U.S. Fire) over allegations that it sold and marketed unauthorized health insurance policies to consumers and failed to cover mandated benefits including mental health, maternity care, “pap” test screening, mammography, and preventive care for children up to age six.
“Time and time again, our office has identified health insurance carriers that failed to cover critical health benefits for consumers,” AG Coakley said. “Mental health care is as necessary to the proper treatment of many patients as physical health care. While our focus is on ensuring that carriers are offering legally mandated behavioral health coverage in Massachusetts, I also believe mental health services should be offered as part of basic health coverage to veterans and millions of Americans across the country.”
The settlement with U.S. Fire, entered in Suffolk Superior Court on April 26, is one of 12 settlements that the Attorney General’s Health Care Division has obtained since 2007, alleging that carriers failed to cover mandated health services. Seven of those cases – amounting to $5.6 million in payments to consumers and the state – include allegations that the insurer specifically failed to cover mental health services required by law:
- U.S. Fire: In April 2013, US Fire agreed to pay $625,000, including approximately $336,000 directed toward consumer relief and $289,000 to the state.
- Transamerica: In March 2013, Transamerica Life Insurance Company agreed to pay more than $1.3 million, including approximately $750,000 directed toward consumer relief and $580,000 to the state.
- LINA: In June 2012, Life Insurance of North Americaagreed to pay more than $1.7 million, including approximately $650,000 directed toward consumer relief and more than $1 million to the Commonwealth.
- Aetna: In June 2012, Aetna Life Insurance Company agreed to pay more than $1 million, including approximately $500,000 directed toward consumer relief along with $555,000 to the state.
- U.S. Life: In April 2011, The United States Life Insurance Company in the City of New York, agreed to pay $760,000 with $500,000 set aside to pay consumers premium refunds and claims for mandated services and $260,000 to be paid to the Commonwealth.
- Continental American: In December 2009, Continental American Insurance Company agreed to pay consumer claims for mandated services and to pay $25,000 to the Commonwealth.
- Pan-American: In June 2008, Pan-American Life Insurance Company agreed to pay affected consumers back approximately $100,000 along with an additional $86,400 to the Commonwealth.
In her letter, AG Coakley notes that “failure to provide coverage of important mandated mental health benefits has a severe and detrimental impact on individuals who need those services, their families, and even their communities.” According to the National Institute on Mental Health, one in four adults suffers from a diagnosable mental disorder in any given year. Serious mental illness, defined as resulting in serious functional impairment, which substantially limits one or more major life activities, affects 1 in 17 people. Studies also show that 20 percent of returning Iraq and Afghanistan veterans report symptoms of post-traumatic stress disorder or major depression.
AG Coakley has made sustained efforts to combat unfair and deceptive practices in the marketing and administration of health insurance. Consumers concerned about illegal health insurance practices in Massachusetts are urged to call the Attorney General’s Health Care Hotline at (888) 830-6277. Consumers who wish to purchase health insurance can find a number of available options at www.mahealthconnector.org. Guidance on how to choose a health plan is also available on the Attorney General’s website.
This U.S. Fire case was handled by Assistant Attorney General Emiliano Mazlen of Attorney General Coakley’s Health Care Division with assistance from Division Chief Thomas O’Brien also of the Health Care Division and from William Mackay of the AG’s Civil Investigations Division. The Health Care Division handled all of the cases mentioned in the release. Attorney General Martha Coakley created the Health Care Division upon taking office in 2007 to place a heightened focus on promoting the interests of consumers as Massachusetts undertook its landmark health reform effort.