NY A.G. Schneiderman Settles with MVP Health Care Over Violations of Parity Laws

March 20, 2014New York Attorney General Eric T. Schneiderman today announced a groundbreaking settlement with a health insurer based on the insurer’s violations of state and federal mental health and addiction parity laws. The settlement includes a $300,000 civil penalty, required review of certain previously denied claims, which could lead to more than $6 million in reimbursements to plan members, and an overhaul of the insurer’s claims review process.

An investigation by the Attorney General’s Health Care Bureau determined that MVP Health Care, through its behavioral health subcontractor Value Options, violated state and federal laws requiring covered health insurers to provide mental health and addiction benefits at parity with medical and surgical benefits. The investigation found that MVP and Value Options issued 40% more denials of coverage in behavioral health cases than in medical cases. This disparity worsened at more intensive levels of care, where denials for benefits like inpatient substance use treatment and inpatient psychiatric treatment were more than double the plan’s denial rate for inpatient medical claims. According to the Attorney General’s press release, one in ten New Yorkers has a substance use disorder but only 11% of those individuals receive any treatment.

Legal Action Center commends the Attorney General for holding insurers accountable under the parity laws, and protecting the rights of New Yorkers who suffer from mental health and substance use disorders. Legal Action Center worked successfully with the substance use disorder (SUD) and mental health (MH) fields towards passage of the federal mental health and addiction parity law in 2008.  Furthermore, through our work co-leading the national Coalition for Whole Health, we have been instrumental in securing strong federal rules for covering SUD and MH at parity with other health benefits in order to ensure that the law is implemented effectively. Today’s announcement follows the Attorney General’s announcement in January of a settlement with Cigna for violations of the state and federal parity laws.

For more details about the agreement between the Attorney General and MVP Health Care, see the Attorney General’s press release. For additional information about the federal mental health and addiction parity law, check out the U.S. Substance Abuse and Mental Health Services Administration (SAMHSA)’s website, as well as the Legal Action Center’s Frequently Asked Questions and the tools developed by the Coalition for Whole Health, which Legal Action Center co-leads. New Yorkers with questions or concerns about the settlement, the mental health and addiction parity laws, or any other health care matters can also call the New York Attorney General’s Health Care Bureau Helpline at 1-800-428-9071.

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