A class action lawsuit was filed against United Health Group Inc., the largest U.S. healthcare insurance company based in Minnetonka, Minnesota (Statista, 2024). The lawsuit was filed by Ryan S., a subscriber of UnitedHealth Group, Inc. (UnitedHealth) insurance, who alleged that UnitedHealth violated the federal Mental Health Parity and Addiction Equity Act (MHPAEA), also known as the Parity Act. Ryan S. accused the company of reviewing benefits claims for outpatient, out-of-network mental health, and substance-use disorder (SUD) treatments more stringently compared to similar claims for medical or surgical treatments. 

The Parity Act, enacted in 2008, ensures equal insurance coverage for mental health conditions, including substance-use disorders, compared to medical or surgical treatment. It mandates that the criteria health insurers use to review and approve benefit claims, including approval processes, coverage limits, and reimbursement rates, must not be more restrictive than insurance coverage for other medical conditions (APA, n.d.). The MHPAEA is enforced by several federal agencies, including the Department of Labor, the Department of Health and Human Services, and the Department of Treasury, to ensure that individuals seeking coverage for mental health and substance-use disorders can access treatment as easily as those seeking coverage for medical treatment (HHS, 2023).  

However, in 2020, the federal district court in the Central District of California dismissed Ryan S’s lawsuit. The court ruled that he did not provide enough evidence or specific instances where UnitedHealth outright denied coverage for mental health or SUD treatments in a way that violated the Parity Act. Additionally, the court found that Ryan S. did not sufficiently demonstrate that his medical or surgical claims were treated more favorably than his mental health or SUD claims. As a result, the case was dismissed and did not proceed further at the time.

Despite the dismissal, Ryan S. appealed the decision to the U.S. Court of Appeals for the Ninth Circuit. In April 2024, after reviewing the legal arguments and evidence presented by Ryan S. and UnitedHealth, the court reversed the dismissal of the district court of Ryan S.’s claims under the Parity Act and for breach of fiduciary duty-the legal obligation of one party (the fiduciary) to act in the best interest of another party (the principal or beneficiary). The Ninth Circuit found merit in the claims made by the plaintiff regarding the alleged violations of the Act by UnitedHealth, allowing the lawsuit to proceed in district court. The Ninth Circuit court ruled that an individual may allege a plausible claim by showing specific instances of differential treatment in their case rather than proving a widespread practice of such treatment. It was enough for Ryan S. to present a reasonable claim based on the specifics of his case.

However, the Ninth Circuit agreed with the dismissal of the lower court of a separate claim that UnitedHealth had violated the terms of Ryan S.’s healthcare plan, as Ryan S. did not identify any specific terms that had been violated. The Parity Act and fiduciary duty claims were remanded to the federal district court for proceedings. A status conference was held on June 10, 2024.

Pete Nielsen, the president and CEO of the California Consortium of Addiction Programs and Professionals, says, “The Ninth Circuit’s ruling sets a precedent for holding insurers accountable under the Mental Health Parity and Addiction Equity Act. This decision could lead to significant decisions in the process and criteria insurance companies use to evaluate and approve benefit claims, safeguarding equitable treatment across all medical conditions” (personal communication, June 18, 2024). 

The journey of Ryan S.’s lawsuit against UnitedHealth Group Inc. reveals the ongoing challenges of ensuring equality for mental and substance-use disorder treatments under the federal Mental Health Parity and Addiction Equity Act. Regardless of the initial dismissal by the district court for the lack of evidence, Ryan S. persisted in appealing the decision to the U.S. Court of Appeals for the Ninth Circuit. The decision of the Ninth Circuit to reverse the dismissal of Ryan S.’s claim emphasizes a pivotal step toward addressing alleged discrepancies in insurance coverage practices. As the case continues in the district court following remand, the outcome will impact the landscape of healthcare parity regulations, emphasizing the importance of equitable treatment for all medical conditions under federal law.

References

• American Psychiatric Association (APA). Mental Health Parity. Retrieved from https://www.psychiatry.org/psychiatrists/advocacy/federal-affairs/health-insurance-coverage-access-to-care/mental-health-parity
• Statista. (2024). UnitedHealth Group- Statistics & Facts. Retrieved from https://www.statista.com/topics/9484/unitedhealth-group/#topicOverview
• U.S. Department of Health and Human Services. (2023). Departments of Labor, Health and Human Services. Treasury announce proposed rules to strengthen Mental Health Parity and Addiction Equity Act. Retrieved from https://www.hhs.gov/about/news/2023/07/25/departments-labor-health-human-services-treasury-announce-proposed-rules-strengthen-mental-health-parity-addiction-equity-act.html