15 Health Insurers Are Fined $2.7 Million
|By Jonathan D. Epstein, The Buffalo News, N.Y.|
|McClatchy-Tribune Information Services|
The fines mark the first-ever such penalties against insurers for violating the five-year-old mental health parity law, which became effective in 2007. The law is named for
The insurers, including Buffalobased HealthNow New York and
That's a requirement of Timothy's Law, which mandates that insurers allow small employers to buy extended mental health benefits when they buy or renew their basic health insurance plans.
The coverage was available to them, but the insurers didn't tell them that in all cases.
"Mental illness can have devastating consequences for families," said
ed against the 15 subsidiaries of seven insurance companies.
"The requirement and process of written notification to our small groups as required by the amendment to Timothy's Law was not followed for a short period of time," Health- Now spokeswoman
All said the violations were not due to any "conscious intentions to evade the requirements of the law," and all agreed to take steps to prevent the mistake from recurring, the state said.
"We worked closely with the state on implementing Timothy's Law; however, we inadvertently overlooked the annual requirement to provide written notice to small groups that a rider was available to purchase the large-group level of coverage," said
Timothy's Law requires insurance plans to provide 30 days of inpatient treatment and 20 days of outpatient visits for mental health treatment.
Large-group plans, for employers with more than 50 workers, must cover treatment of biologically based mental illnesses and children with serious emotional disturbances at a level that is comparable to coverage for nonmental health conditions. Small groups must be given the option of buying that level of coverage as an extended benefit.
The violations, which occurred in 2009 and 2010, were discovered after state regulators investigated complaints from small businesses, which said they would have bought the coverage but were never advised of that option. Regulators looked at other insurers as well but didn't find violations.
"We are very pleased that the
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