Cigna ordered to reverse its policies on autism coverage

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  • New York Attorney General Eric Schneiderman brought about a settlement with Cigna that imposes a penalty of $50,000 and stipulates the company must not only revise its policies, it must pay autism claims that it previously had rejected, New York Business Journal reported.
  • Cigna must change its written policy banning coverage of neuropsychological testing for psychiatric conditions and autism spectrum disorder.
  • Further, the company has agreed to comply with Timothy’s Law, which requires group health plans in New York to provide “broad-based coverage for the diagnosis and treatment of mental, nervous or emotional disorders or ailments” that matches or surpasses coverage for other health conditions.
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Dive Insight:

Coverage for psychiatric testing and care has long lagged behind coverage for other medical conditions. In 2008, the Mental Health Parity and Addition Equity Act brought some relief to consumers by preventing large health plans for structuring their coverage for mental health conditions much differently than their coverage of other medical conditions. Under the Affordable Care Act, the requirements were extended to individual plans.

“Parity is the new normal,” Dr. Colleen Barry, professor and associate chair for research and practice in the department of health policy and management at the Johns Hopkins Bloomberg School of Public Health, told Healthcare Dive last August. “We’ve passed the phase where transitional violations are OK and need to get to a point where the requirements of parity are being strictly enforced.”

Overall, the Substance Abuse and Mental Health Services Administration (SAMHSA) estimated 43.6 million American adults (about 18.1% of the population) have experienced mental health issues.

But mental health services can be costly. Autism in particular has garnered much public attention as the incidence of the condition rises — and those costs are going to get much worse. According to conservative estimates by health economists at the University of California Davis in 2015, direct medical, direct non-medical and productivity costs related to autism spectrum disorder will reach $461 billion annually by 2025. Should the prevalence of the disease continue to rise, costs will exceed those for diabetes by 2025.

Compliance with Timothy’s Law will put additional strain on Cigna, which suffered financial losses in the past year.

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