Insurer Accused of Ducking Coverage for Kids

     SAN FRANCISCO (CN) – A federal class action claims Blue Shield of California denies coverage for residential treatment of mentally ill children, violating its own policies and state requirements mandating coverage for “seriously emotionally disturbed” children and adolescents.




     The lead plaintiff claims Blue Shield denied coverage for his adopted son’s residential psychotherapy, which included treatment for his learning disability and “disruptive behavior disorder” at a wilderness camp and the Island View Residential Center for Adolescents.
     After their first claim for reimbursement was denied, Island View continued to submit appeals to Blue Shield in which they “discussed the requirements of the California statute mandating coverage for severely emotionally disturbed (SED) children,” according to the complaint. Island View eventually advised the plaintiff to seek legal counsel after Blue Shield stopped responding to their letters and phone calls.
     Brian King, the lead plaintiff’s attorney, said that residential treatments are important elements of care for mental health patients, but they can be very expensive, and insurance companies often look for ways to duck coverage.
     King said that such conduct violates the California Insurance and California Health and Safety codes. “California statute makes it clear that insurance companies have to cover treatment for mental illness just as they have to cover treatment for physical illness,” King said. “You can’t pick and choose what treatments to cover just because mental illness is more expensive.”
     King said that although Blue Shield has followed this exclusionary practice for a number of years, people have a tendency to accept it and pay up. “I don’t think anyone has challenged them on this until now,” he said
     He wants Blue Shield enjoined from excluding coverage for residential treatment services, reimbursement for the cost of the residential treatments and attorney’s fees.
     King said he hopes his action will shape the way other insurance companies handle coverage for mental illness. “I don’t think many insurance companies will be able to get away with denying this coverage in the future,” he said.

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