Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...
Anthem Insurance Cos. Inc. will pay almost $1.63 million to end claims that it violated federal benefit laws by placing certain caps on the coverage of therapy treatments for children with severe autism disorders.
Anthem also agrees to stop using guidelines that base coverage of applied behavior analysis therapy for autism solely on an individual’s age, according to a motion seeking approval of a class action settlement filed March 23 in the U.S. District Court for the Southern District of Indiana.
If approved, the settlement will provide relief for at least 201 children and allow class counsel to seek fees of up to $508,345. The estimated average payment to class members will be $5,052, with payments ranging from $2.02 to more than $36,000, according to court documents.
The proposed deal would end a three-year lawsuit that accused the insurance giant of violating federal mental health parity law when it limited coverage for a 13-year-old boy’s autism treatment to 20 hours per week. The settlement comes one year after a federal judge held that Anthem satisfied Indiana’s autism mandate, which requires insurers to cover treatment for autism spectrum disorder, by covering 20 weekly hours of treatment instead of the 40 hours requested.
Anthem joins a growing list of companies that have settled claims over coverage of ABA therapy for autism, including United Healthcare Services Inc., T-Mobile USA Inc., and Applied Materials Inc. Similar challenges against Dr Pepper Snapple, Raytheon Co., Banner Health, and Neiman Marcus Group. are pending. Late last year, a federal judge in Washington refused to dismiss similar allegations against the NECA/IBEW Family Medical Care Plan.
In addition to the almost $1.63 million payment and Anthem’s promise to cease using its guidelines, the insurer will also issue a statement to its employees regarding the use of age-related considerations. Anthem will also require employees who review treatment plans to participate in periodic external continuing education related to autism and ABA therapy.
Terrell Marshall Law Group PLLC and SAEED & Little LLP represent the class. Katz Korin Cunningham PC and Reed Smith LLP represent Anthem.
The case is W.P. v. Anthem Ins. Cos., S.D. Ind., No. 1:15-cv-00562-TWP-TAB, plaintiffs’ unopposed motion for preliminary approval of class action settlement 3/23/18.
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