Health Plan of Nevada Hit with Class Action Over 100-Day Coverage Limit on Residential Mental Health Treatment Services

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Health Plan of Nevada, Inc. (HPN) faces a proposed class action that claims the insurer’s 100-day treatment limit on coverage for residential mental health services violates federal law.

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The 14-page lawsuit says the Las Vegas-based insurer has run afoul of the federal Mental Health Parity and Addiction Equity Act (the Parity Act), which requires that the exclusions a health plan imposes on its mental health benefits be “no more restrictive” than the limitations applied to virtually all of the plan’s medical and surgical services.

One plaintiff, a 17-year-old Las Vegas resident, is enrolled in an HPN health plan through his father’s employer, the suit relays. Since August 2021, the boy has received treatment for multiple mental health and substance use conditions at Daniels Academy, a licensed residential treatment center (RTC) located in Utah, the case shares.

Though HPN purports to cover mental health services, the insurer excludes from coverage any RTC services that exceed 100 days per member per year, the complaint states.

According to the filing, the plaintiff’s ongoing coverage was denied after he “exhausted the 100-day calendar year maximum residential treatment benefit” in December 2021. Subsequent appeals of the denial were rejected by the insurer, the lawsuit says.

Moreover, at the start of 2022, the boy’s coverage was renewed for a period of 100 days before he was notified that, once again, he would be denied coverage going forward, per HPN’s policy, the suit describes.

Under the Parity Act, if an insurer imposes a quantitative treatment limitation on any mental health benefit, it must also apply the same exclusions to at least two-thirds of all medical or surgical services covered in “the parallel service category,” the case explains. In this instance, HPN’s 100-day exclusion should have also been imposed on two-thirds of the covered medical or surgical services that fall into the same classification as RTC services, which includes in-network or out-of-network inpatient services, the lawsuit shares.

However, the complaint alleges that HPN does not impose the 100-day limitation on other medical or surgical benefits in these categories and, in fact, only applies the exclusion to RTC services and skilled nursing facility services.

The filing claims, therefore, that HPN’s 100-day treatment limitation on coverage of RTC benefits “systematically” violates the Parity Act and the rights of the plaintiffs and other class members to proper health care coverage.

“As a result of HPN’s application of the 100-day exclusion to the RTC services that [the plaintiff] received at Daniels Academy in 2021 and 2022, [he] and his parents paid out-of-pocket for Residential Treatment Center behavioral health services that would have been covered, but for HPN’s application of the 100-day exclusion, an illegal quantitative treatment limitation on [the plaintiff’s] claims for behavioral health service coverage,” the case charges.

The lawsuit looks to represent anyone who, since December 6, 2015, has been, are or will be a participant or beneficiary in an ERISA “group health plan” that was insured or administered by HPN, where the plan excludes or excluded coverage of RTC services beyond 100 days per person per year, and who required or are expected to require more than 100 days of RTC services in a calendar year.

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