The Department of Labor (DOL) States More Investigations Are Ongoing and Forthcoming Regarding Other Insurers and Health Plans

The United Healthcare Lawsuit Background

On August 12, 2021, the DOL and the New York Attorney General announced a $15.6 million settlement with United Healthcare, United Behavioral Health, and other affiliated companies (collectively “United”) stemming from United’s systemic violations of the Mental Health Parity and Addiction Equity Act (MHPAEA) and Employee Retirement Income Security Act (ERISA) from 2013 forward.

Participants were harmed when United reduced reimbursement rates for out-of-network mental health services and used a tiered reimbursement system for non-physician healthcare providers, resulting in the overcharging of health plan participants for those services. United had also flagged participants undergoing mental health treatment for a rigorous utilization review, which proceeded in many denials of payment for those services.

The settlement evolved from several private-party class actions and lawsuits brought by the DOL and the New York Attorney General. Of the $15.6 million, $13.6 million is earmarked to be returned to impacted plan participants and their beneficiaries in both ERISA and non-ERISA plans. United will also have to change some of its mental health utilization review practices and improve its disclosures to plan participants.

Next Steps for United Healthcare

The settlement agreement requires United and the other defendants to fund a settlement and to send settlement notices to impacted health plan participants. That process will likely take two to three months. Required communication to impacted plan participants will come from the settlement administrator. The impacted health plan participants will then be invited to seek financial reimbursement by filing a claim with the settlement administrator.

Lawsuit FAQs

Q: Does the settlement apply to only health plans that currently have insured their health coverage with United?

A: No. The settlement agreement requires United to look back to 2013 in order to identify impacted participants. A draft claim Notice in the settlement agreement has a date of November
22, 2013

Q: Does the settlement also apply to participants in self-insured plans where United served as a claims TPA?

A: Yes.

Q: Will the settlement apply to the participants of non-ERISA health plans, such as municipalities, that also had coverage with United?

A: Yes.

Q: Who will be getting the money, the plan sponsor or the plan participants?

A: Affected plan participants and their beneficiaries.

DOL Announces Ongoing and Increased Investigations of Health Insurers and Health Plans for MHPAEA Compliance

Contemporaneous with the DOL’s announcement of the United Healthcare settlement, the DOL also announced that it also has a number of current investigations regarding other health insurers and health plans and that it anticipated stepping up its compliance oversight in 2022 regarding MHPAEA.