Drug, alcohol and mental health treatment providers were caught off guard when the nation’s largest insurance companies began turning down seemingly valid insurance claims after Obamacare was enacted in October of last year. For insurance providers, it wasn’t supposed to turn out this way. Obamacare also referred to as the Affordable Care Act (ACA) and its sub-component – the parity act –-were expected to expand coverage by requiring that mental health and substance abuse treatment receive equal footing with medical health care.
What went terribly wrong for those seeking drug, alcohol, and mental health treatment after Obamacare?
There wasn’t one single event that led to this dramatic shift in the way large insurance company’s approve or deny their dual diagnosis drug and alcohol claims for out-of-network providers, but more of a series of developments that led to the sea change.
The much improved relationship between Obamacare and insurance carriers started to nuture when the insurers’ provided critical support to the president in court battles over Obamacare including a case now before the Supreme Court challenging federal subsidies paid to insurance companies on behalf of low and moderate income consumers as reported in the New York Times article “Health Care Law Recasts Insurers as Obama Allies.”
Then, the historically frothy relationship between democrats and healthcare insurance companies officially thawed last fall when a unit of one of the nation’s largest insurers, UnitedHealth Group, assisted the administration to repair the Healthcare.gov web site after it crashed in the first days of enrollment.
The final turning point has been the tsunami-like surge of Obamacare enrollees signing up for coverage with the large insurance carrier who are funded by the federal treasury. This massive influx of Medicaid, Medicare, and federal exchange enrollment from Obamacare has placed these insurance conglomerates into a hyper growth mode. As the second open enrollment period has just commenced – this trend is only going to increase the insurance company’s profits now accounting for tens of billions of dollars and is lining the pockets of their shareholders as share prices have doubled since the inception of Obamacare.
According to Michael J. Tuffin, a former executive vice president of America’s Health Insurance Plans, the main lobby for the industry, “there will be nearly $2 trillion of subsidized coverage through insurance exchanges and Medicaid over the next 10 years.”
But let’s not digress from the initial point of the article that theorizes that out-of-network drug and alcohol rehabs and clients are being snubbed mainly by the four major insurance companies – Aetna, Cigna, Humana, and UnitedHealth.
“The result of this paradigm shift involves the loss of hundreds of millions of dollars in unpaid and denied insurance claims from the largest healthcare providers,” said Karen Corcoran Walsh, founder of Inspirations for Youth and Families and the Cove Center for Recovery, premier national rehabs for teens and adults. “Some of these improper denials have occurred in mid stream or even more troubling after the client has already received treatment.”
To add fuel to Corcoran-Walsh’s fiery assertion, there looms a federal class-action suit that has been filed against UnitedHealthcare Insurance Company and United Behavioral Health (UBH) by the law firm of Zuckerman Spaeder LLP on behalf of plan members affected by mental health conditions or substance abuse disorders whose coverage was denied. The legal team believes United is not applying parity rules correctly in some situations and wants the insurer to resolve the current complaints and change its policy for the future. The law suit alleged that UnitedHealth has denied countless insurance claims by those insured.
While the AFA has made good on its promise to provide healthcare insurance to more Americans – roughly 10 million so far – many feel there has been collateral damage incurred by many out-of-network policy holders whose insurance claims have been puzzlingly denied by large healthcare companies. A prevailing theory some industry insiders hold is that the insurance companies, who are largely benefitting from their new found Obamacare business, are now less motivated to honor their out-of-network insurance claims. The reasoning being that out-of-network payment rates are considerably more expensive to service than Obamacare policies.
“At a time when we are talking about the Affordable Care Act, we should be talking about a new issue on the horizon – the Accountable Care Act,” Corcoran Walsh sharply stated. “Insurance companies should be accountable for services that they authorize and for patients who have insurance other than those recognized by Obamacare.”
The end result of this influx of Obamacare plans by large insurance companies can have a chilling effect for both insured and third-party providers. It is possible that a lot of drug, alcohol, and mental health treatment centers will either go out of business or choose to directly charge their clients for unpaid insurance claims.
Corcoran-Walsh believes this can lead to those most vulnerable to opt out of private network plans and replace them with “watered down” versions of Obamacare – leading to less favorable addiction treatment outcomes. The worst case scenario could involve drug and alcohol addictions and mental health conditions to spiral out of control to epidemic proportions.
On the flip-side, for those out-of-network insured, who are denied coverage and elect to pay for third-party providers services out of pocket, you may see more personal bankruptcies, homelessness, and in severe circumstances death from drug, alcohol, and mental health treatment neglect.
At this point, there is no regulatory agency to police unfair healthcare claim denials. For those impacted by insurance claim abandonment, they can only hope for a positive verdict for the plaintiffs in the UnitedHealth class action suit. This in turn, could send a signal to the insurance company cartel to change their ways.
Corcoran-Walsh firmly believes the only way to resolve this issue is to organize within the drug, alcohol, and mental health treatment industry by hiring high-powered lobbyists and forming a Political Action Committee. But to start this grass root campaign someone has to carry the torch and for now there are not any holders.