Autism Health Insurance Reform: Update – PEBB settlement, 2015 legislative results
Dear readers, this is a somewhat overdue summary of ongoing success in Autism Health Insurance Reform in Oregon from 2015.
- PS v PEBB settlement – Oregon compensates public employees for discrimination and autism treatment
- Latest AF v Providence decision – next steps on compensation
- Legislative Update – SB696
- Other 2015 legislation
- Tips on coverage for autism treatment through Cover Oregon
PS v PEBB settlement – Oregon compensates public employees for discrimination and autism treatment
On December 8, 2015, the Marion County Circuit Court issued an Order granting preliminary approval of a Settlement Agreement in the class action lawsuit, P.S. v Oregon Public Employees Benefits Board (PEBB), filed on behalf of “P.S.,” a six year old girl with autism whose mother is an employee of the State of Oregon. P.S. sought coverage of Applied Behavior Analysis (ABA) therapy as a treatment for autism. The class includes any member of PEBB’s self-insured plans (the Providence Choice Plan and the Statewide Plan) who received ABA therapy to treat Autism Spectrum Disorder and incurred unreimbursed expenses.
This settlement follows numerous decisions and settlements in Oregon, Washington, and around the country directing health benefit plans to pay for coverage of ABA therapy as a treatment for autism – including bulletins issued by Oregon’s Insurance Division in November 2014.
In what may be the first of its kind in the nation, however, this settlement also includes $17,500 in compensation to resolve allegations that the State of Oregon violated the civil rights of P.S. and her family by denying coverage of ABA therapy solely because it was “related to Autism” – even though Oregon’s Mental Health Parity law has required coverage for treatment of autism since 2005. Providence Health Plans, acting as PEBB’s plan administrator, had issued denial letters stating that:
“Under Providence’s Plan, services ‘related to developmental disabilities, developmental delays or learning disabilities’ are specifically excluded from coverage. Because ABA services are related to Autism Spectrum Disorder, they are therefore not benefits covered by your plan.”
This settlement became inevitable after last year’s U.S. District Court decision in A.F. v Providence, which found that essentially identical conduct by Providence in its commercial group insurance policies violated both Oregon and Federal Mental Health Parity laws in a landmark decision on August 8, 2014.
Nevertheless, the Oregon Department of Justice continued to vigorously defend the conduct that both the court and Oregon’s own Insurance Division had declared to be illegal. Oregon granted Providence the right to make legal decisions on the state’s behalf, and appointed a Providence contract attorney as a Special Assistant Attorney General to represent the State in court. In 2014, we had submitted legislation to bring the PEBB plan under Oregon’s Mental Health Parity law – but it was blocked when PEBB assured the legislature that it was already in full compliance and that legislation was unnecessary. Once the litigation was initiated, however, PEBB successfully argued that it was exempt and couldn’t be held accountable under Oregon law – but wasn’t about to avoid liability under the Federal Mental Health Parity and Addiction Equity Act.
In this settlement agreement, the State of Oregon has agreed to reimburse class members for expenses they incurred to pay for ABA therapy to treat autism spectrum disorder between January 1, 2010 (the date that the Federal Mental Health Parity law took effect), and January 30, 2015. It is anticipated that all class members will be fully reimbursed, but if total claims exceed $400,000, payments will be prorated. However, if total claims are so large that class members would be reimbursed less than 60% of their actual expenses (e.g., if total claims exceed $666,667), then the settlement will automatically terminate barring an agreement to increase the limit to ensure sufficient compensation.
In reality, unfortunately, most PEBB members who needed ABA therapy were unable to access it because they couldn’t afford the cost out of pocket. Others who did obtain therapy received far less than they should have for financial reasons. There is unfortunately no reimbursement or compensation for this therapy that PEBB members should have been able to access but couldn’t. A recent U.S. Supreme Court decision has opened the door to this form of compensation under “ERISA” plans for private employers (as you will see below in the discussion on AF v Providence) – but the State of Oregon, as a governmental body, is exempt from ERISA and this compensation wasn’t available.
Similarly, while many state employees suffered the same discrimination as lead plaintiff “P.S.,” the civil rights statute that the state violated has very strict requirements in terms of the statute of limitations and procedures for filing a complaint, so it is unlikely that anyone other than P.S. will qualify for compensation.
Nevertheless, this is an important victory and helps reinforce the right for all of us to access the medically necessary care needed to address symptoms related to autism.
Latest AF v Providence decision – next steps on compensation
While the PS v PEBB case, above, covers State of Oregon public employees on the Providence-administered health plans, the AF v Providence case covers individuals with fully insured group health plans issued by Providence through private employers. As you may recall, on August 8, 2014, U.S. District Court issued a landmark decision that Providence had violated Oregon and Federal law by denying coverage of ABA therapy as a treatment for autism, on the same grounds outlined above for PEBB members (http://autisminsuranceor.org/2014/08/autism-health-insurance-reform-judge-declares-providence-violated-state-and-federal-law-in-denying-autism-treatment/). While that decision was critically important – and led the Insurance Division to implement a bulletin requiring all other insurers in Oregon to provide comprehensive coverage of medically necessary care for autism and other mental health conditions – it was really just a first step in a long litigation process.
On January 7, 2016, U.S. District Court took the next step, issuing a decision awarding reimbursement for money actually spent on ABA services, and denying a Providence motion to dismiss a claim for compensation for the value of ABA services that plaintiffs should have received but couldn’t because they were improperly denied coverage.
Unlike the PS v PEBB settlement – which awarded compensation to any public employee in the Providence administered PEBB plan who paid for ABA therapy, whether they ever requested reimbursement or not – the AF v Providence award applies only to those class members who (a) formally requested coverage of ABA therapy, but were unlawfully denied; (b) went ahead and obtained ABA therapy anyway and paid for it themselves out of pocket; and (c) submitted reimbursement claims to Providence within one year of receiving the care. Out of the entire AF v Providence class, there were only four covered individuals who submitted claims meeting these stringent criteria. The total amount awarded for all four plaintiffs combined was only about $19,140.
That’s right – after many hundreds of thousands of dollars of litigation expenses, and years of effort by Providence to deny coverage, the total amount of money actually awarded (so far) is under $20,000. The biggest reason for this is that ABA therapy is so expensive that individuals who couldn’t get coverage simply couldn’t afford treatment and had to go without. The process to qualify was also elaborate, and many patients were simply never aware of their rights or didn’t go through the procedures to make formal requests and pursue their appeals.
Historically, the understanding was that ERISA – the Federal law governing private-employer based health benefit plans – strictly limited damage awards to reimbursement for money they actually spent; if a plaintiff had to go without medical care because of an unlawful denial of coverage there was no way to recover the value of the lost care. In its defense, Providence cited a 1998 decision by the 9th Circuit court of Appeals in Bast v Prudential in which the patient – Rhonda Bast – died when Prudential improperly denied coverage of a bone marrow transplant. Since the Bast’s couldn’t afford the treatment without insurance, there was nothing to reimburse, and Prudential had no liability –even though its erroneous decision had led to Ms. Bast’s death.
Very critically – the AF v Providence court determined that a more recent decision by the U.S. Supreme Court in CIGNA v Amara had clarified that consumers really can recover “make-whole relief” when their insurer violates their fiduciary duty and improperly denies coverage. This relief can be equal to the amount of money that the insurer should have spent on coverage – essentially, “disgorging” the money that the insurer has improperly retained. The decision at this stage simply agrees to allow the plaintiffs to proceed and make their request – any decision on actual compensation for this “make-whole relief” will be in the future.
That said, this decision – which has been supported by developments in several other cases around the country – is really a game changer in nearly all health insurance lawsuits for all conditions, not just autism cases in Oregon.
Bear in mind also that even this just requires the insurer to pay the amount of money that it should have paid all along – there is still no possibility for consequential damages (for the impact that the illegal denial had on the consumer) or punitive damages. If an insurer were to intentionally violate the law, and withhold coverage of legally required care leading to a patient’s death, the insurer still wouldn’t be liable for the wrongful death – but at least they could have to pay the heirs for the value of the improperly denied healthcare. This remains grossly unjust, but only the legislature can fix that. In Oregon, the Unlawful Trade Practices Act (UTPA) explicitly exempts the insurance industry from liability for unlawful acts – and every attempt to fix that has been blocked by legislators in both parties.
Under the 2013 SB414, which we wrote, Oregon’s Insurance Commissioner can seek restitution for actual damages resulting from illegal activity – such as compensating a consumer for wrongful death – but more than two years after it went into effect, this authority has never been used.
Legislative Update – SB696
Last summer, Oregon’s legislature unanimously passed SB696, which updates the rules for licensing and registration of Applied Behavior Analysis (ABA) providers in Oregon.
The original Autism Health Insurance Reform bill – the 2013 SB365 – established a framework for insurer approval and management of treatment for autism, and created the Behavior Analysis Regulatory Board (BARB) within the Health Licensing Office to license the previously unlicensed “Board Certified Behavior Analysts” (BCBA) with certificates from the BACB, Inc., a nationally respected private non-profit organization; and “register” licensed health care professionals – such as psychologists, speech-language pathologists, and occupational therapists – who were providing ABA therapy within their existing scope of practice and licensure. It also “registered” behavior analysis interventionists – paraprofessionals – who could operate under the supervision of any licensed behavior analyst or other licensed provider registered by the board.
In implementation of licensure and regulation of ABA providers under the BARB, several critical issues arose, which SB696 has addressed:
Conflicting authority with other Oregon boards:
The BARB’s authority to “register” licensed health care professionals like psychologists, SLPs and OTs conflicted with that of the Boards which licensed them. When the BARB developed its rules for registration, there was a breakdown in communication and collaboration with the other Boards and professional associations, leading them to ask the legislature to intervene.
SB696 drops the requirement that other licensed health care professionals cross-register with the BARB, and reiterates that they may only practice ABA within the scope of their licenses. This is consistent with model ABA licensure legislation developed by the BACB, Inc.
Unclear scope for the BARB:
Nothing in SB365 actually stated that the BARB’s responsibility was to regulate Applied Behavior Analysis, and at least one health plan misinterpreted the Board’s authority as regulating ALL forms of treatment for autism. The result was that these plans inserted contractual language preventing any health care provider from being reimbursed for ANY services to treat autism – even things like medication management completely unrelated to ABA – unless they were licensed or registered by the BARB.
SB696 specifically authorizes BARB’s licensees to practice ABA therapy in Oregon, and to be reimbursed for it by insurance.
Confusing legal structure:
The Behavior Analysis Regulatory Board didn’t fit well within the existing Health Licensing Office framework for other boards, adding to administrative overhead and confusion. Key, desirable legislative features – like fingerprinting as part of a background check – were inadvertently left out by creating an unnecessarily unique structure.
SB696 was written with close support from the staff at the Health Licensing Office to streamline operations and improve efficiency. It also specifically requires the same national background check required of other health care professions.
Need to grandfather existing, qualified ABA providers:
There are a few highly respected and capable ABA providers who have been treating patients with autism in Oregon for many years, but who don’t have BCBAs and aren’t licensed health care professionals – because they were never previously required.
One example is Dr. Kathi Calouri of PACE Place – who was an early pioneer of ABA therapy in Oregon. As a graduate student at UCLA in the 1980s, Dr. Calouri was the Clinic Supervisor for Dr. Lovaas’ ABA program – and worked with him on the original research which demonstrated the effectiveness of ABA therapy as a treatment for autism. After she returned home to Oregon, she opened an ABA clinic in 1992 and has been helping patients ever since. As a Developmental Psychologist, Dr. Calouri doesn’t have a psychology license in Oregon, and she never received a “BCBA” certificate – since it wasn’t created until long after she began her practice, and until now was never required.
SB696 gives experienced ABA providers like Dr. Calouri the chance to be “grandfathered” – to continue practicing ABA for several years (until June, 2018), while the BARB establishes a permanent set of grandfathering requirements and procedures.
SB696 was supported by the Autism Society of Oregon, Oregon Pediatric Society, Oregon Psychological Association, Oregon Speech-Language Hearing Association, and many individual providers and consumers, including myself. It passed unanimously, and took effect on November 1st.
Other 2015 Legislation
There were several other important bills in 2015….
Oregon’s SB777 implements the Federal ABLE act, which allows states to create savings accounts that can be used to pay for disability-related expenses. Before ABLE, individuals on means-tested programs like SSI and Medicaid limited individuals with disabilities to about $2,000 in savings – if they saved more than that, they would lose their benefits. This essentially forced the disabled into poverty, and wouldn’t even allow them to save money to pay for their own disability-related expenses. ABLE accounts allow individuals to save money for these disability-related expenses without losing access to SSI and Medicaid.
SB777 passed, and took effect on October 5, 2015.
Here’s a press release with more information: https://www.autismspeaks.org/advocacy/advocacy-news/oregon-31st-state-enact-able-legislation
HB2597: Truancy Evaluation for Disability
Oregon law imposes heavy civil penalties on families for truancy, if a child has too many absences from school.
Under HB2597, if a family is being cited for truancy, the parents can request an evaluation to determine if the child has a disability and if the unexcused absences are a manifestation of that disability before civil penalties are imposed on the parents. This will help solve disability-related truancy problems by addressing the root cause – a need for special education services – and also prevent districts from using truancy proceedings to retaliate against parents of disabled children.
HB2597 passed, and took effect on July 1, 2015.
HB2673: Special Education Disclosure and Timely Evaluation
HB2673 would have:
- Required school districts to provide parents with an annual summary of the special education and related services provided to students in the previous year
- Prohibited school districts from requiring parents to sign confidentiality agreements preventing them from sharing information about the accommodations or services they have received with other parents (a common requirement when parents pursue legal action to enforce their rights)
- Required schools to conduct initial evaluations for IEP eligibility in a timely manner. Currently, Oregon can take up to 60 school days to do an evaluation – with weekends and holidays, this can take many months (up to 5 or 6 months if the evaluation request is delayed over summer vacation) – which can in turn delay the start of special education services by half a school year. Oregon is in the bottom 10% nationally for evaluation speed
HB2673 was scheduled for a vote, but was killed at the last minute due to objections from school district lobbyists.
I have had some candid discussions with special education administrators about the requirement to provide parents with an annual summary of special education services – and they have been very direct about their opposition: I was told that if parents knew what kinds of services other students in the district were getting, that “we would have to hire another attorney” to fend off requests.
This is of course not an appropriate or reasonable objection, but it is literally what I was told by a district administrator who worked to oppose HB2673.
I am interested in bringing it back in 2017, but in the meantime I’m working to use Oregon’s Public Records laws to get some of the information – both so I can develop and share a draft report, and to demonstrate to the Districts that the information is already available and legally can’t be hidden anyway.
SB844: Medical Marijuana
SB844 revised Oregon’s laws on Medical Marijuana. At the last minute, an amendment was inserted to expand the scope of conditions eligible for medical marijuana card to include a “pervasive neurological condition.” This was intended by the staff to mean “pervasive developmental disorder” (e.g., autism), and I know of at least one individual with autism who has successfully used this to obtain a medical marijuana card.
I was not involved in this, and am not personally familiar with the medical evidence or clinical indications for use of marijuana to treat symptoms associated with autism – but it is now possible in Oregon. Oregon does appear to be the first in the country to adopt medical marijuana for autism – Michigan considered it last summer, but dropped it at the last minute.
SB844 passed, and took effect on August 12, 2015.
HB2796: Music Therapy Licensing Board
HB2796 established a licensing board for music therapists. While it doesn’t specifically require insurance plans to cover music therapy, the license makes insurance reimbursement possible. Oregon’s Mental Health Parity law requires coverage of medically necessary care for autism, so as long as the patient and provider can demonstrate that music therapy is medically necessary it should be covered.
HB2796 passed, and became operative on January 1, 2016.
SB488: Hand Dryer Noise Control
SB488 would have established uniform standards for hand dryers installed in public restrooms, including standards that impose limit on decibel level of operating hand dryer.
This was introduced by Sen. Edwards, the father of a boy with autism, because of the sensory challenges that many individuals with autism experience from the sudden, loud noise caused by some of these hand dryers. The purpose was to set noise level standards, and require installation of quieter dryers that wouldn’t be as stressful.
SB488 passed the Senate, but died in the House.
Tips on coverage for autism treatment through Cover Oregon
Ever since the Insurance Division published bulletins INS 2014-1 and 2014-2 in November, 2014, all commercial insurance plans in Oregon should be covering comprehensive treatment for autism, including ABA therapy.
In addition, the Oregon Health Plan – Medicaid – also covers ABA therapy along with rehabilitative care (speech, occupational therapy, and physical therapy). That said, there are still some self-insured plans that refuse to cover autism treatment.
If you are in need of insurance coverage for autism you can get it through Health Exchange: http://www.oregonhealthcare.gov/
Even if your family already has insurance that excludes autism or ABA therapy, it is possible to purchase a child only plan, covering only the child with autism. A child only plan will cost about $150 to $190 per month.
Here are things to look for when selecting a plan:
- Basic insurance features – look for a plan with a low deductible, low out of pocket maximum, and low co-pays. In general, this would be a “Gold” or “Platinum” plan.
- A network that will cover your providers. You should talk to your providers to find what insurance they work with. This is particularly critical for ABA providers, since Oregon’s insurers are beginning to develop closed networks.
For commercial insurance, the deadline is January 31, 2016 – if you don’t buy a plan by then, you’ll have to wait until next year. You can apply through this link: https://www.healthcare.gov/
For the Oregon Health Plan (Medicaid), you can apply at any time. Follow this link for information: http://www.oregonhealthcare.gov/apply-for-medicaid-now.html