The Games Insurers Play: "Not Medically Necessary"; "Not a Covered Benefit

Posted By Kantor & Kantor || 26-Jan-2015

If you have been denied medical services by your insurer, chances are you have received one of the above reasons for that denial. Before the Mental Health Parity and Addiction Equity Act ("MHPAEA") was introduced in 2008, insurers continually denied those suffering from a mental illness on the basis that the Plan or the Policy did not cover services for mental health benefits. However, when the MHPAEA came into effect, the rise in denials on the basis of "not medically necessary" skyrocketed.

So what does the term "medically necessary" mean? Who defines it? How does is relate to mental health benefits?

The term medically necessary appears only 3 times in the Affordable Care Act and none of those instances define the term. The American Medical Association defines medical necessity as:

"Health care services or products that a prudent physician would provide to a patient for the purpose of preventing, diagnosing or treating an illness, injury, disease or its symptoms in a manner that is: (a) in accordance with generally accepted standards of medical practice; (b) clinically appropriate in terms of type, frequency, extent, site, and duration; and (c) not primarily for the economic benefit of the health plans and purchasers or for the convenience of the patient, treating physician, or other health care provider." The "prudent physician" standard of medical necessity ensures that physicians are able to use their expertise and exercise discretion, consistent with good medical care, in determining the medical necessity for care to be provided each individual patient.

However, this definition applies to physical illness; there is no universal definition for mental illness. Insurers often have their own definitions and surprisingly, more often than not, the denials they issue on the basis of services not being medically necessary, are inconsistent with their own definition.

The Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition (DSM-5) is the 2013 update to the American Psychiatric Association's (APA) classification and diagnostic tool. In the United States the DSM serves as a universal authority for psychiatric diagnosis. Treatment recommendations, as well as payment by health care providers, are often determined by DSM classifications, so the appearance of a new version has significant practical importance. While this is the benchmark in the mental health world as to how to identify and treat many mental illnesses, there is still no universal definition of "medically necessary" that can be applied to mental illnesses.

The lack of definition and ambiguity around the term "medically necessary" for mental illnesses, makes it easy for insurers to continue to try to "get around the rules for mental health care," as Darcy Lockman, a clinical psychologist from New York City discovered. Ms. Lockman said she had clients who were foster kids and had watched their parents handcuffed during drugbusts, adults whose emotional struggles with chronic illnesses had left them practically housebound, and clients who suffered from extreme developmental issues. She found during calls to insurance companies on behalf of her patients, she was asked questions such as "How much longer will the patient need to see you? Why was the therapy necessary? Why should we pay for this?" Lockman said the case managers were "dubious and bullying, trained primarily, it seemed, in suggesting her patients and she were trying to get away with something."

This is something at Kantor & Kantor we see all too often. The attitude from the insurance companies is that somehow our clients want to be in treatment for their illness; that they have control over it. One of the biggest problems with mental illness is the fact that most people who suffer from a mental illness do not want to admit that they need help; they don't want to acknowledge that they are powerless over their illness. In a twisted case of irony, the insurance companies and the mentally ill are often in unison on that point.

Denial of mental health services for those suffering from mental illnesses has turned into a game that insurers play; and they are very good at it. Not only does one have to go through a lengthy and arduous appeals process that usually leads to litigation in order to get benefits paid, but the system also prevents mental health professionals from actually doing their jobs. There are entire departments now in mental health facilities around the country that are dedicated to dealing with insurance companies, such is the insanity that surrounds the information insurers require in order for them to consider paying for mental health services.

Mental health is a complex area of medicine. It requires patience and it is expensive. However, it is a seriously flawed system that allows insurance companies to continue to deny insureds who suffer from mental illnesses on the basis that the services they require are "not medically necessary," whatever that means.

If you suffer from a mental illness and have been denied treatment, call us at 888-569-6013 for a free consultation. We can help.

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