California Department of Managed Health Care Sued for Unlawful Handling of Mental Health Appeals

LOS ANGELES, CA--(Marketwired - Feb 24, 2016) - Evolve Growth Initiatives LLC has filed a first-of-its-kind lawsuit against the California Department of Managed Health Care and its director, Shelley Rouillard. The lawsuit seeks to compel DMHC to follow a 16-year-old state law requiring DMHC to promptly process expedited appeals when health care coverage, including mental health treatment, is denied.

"Expedited appeals submitted to DMHC are critical for patients who have been denied mental health care and need a final coverage decision before they can get approved for treatment," explained Meiram Bendat, Evolve's counsel and president of Psych-Appeal, Inc. "The consequences of not receiving a timely decision can be devastating since patients must decide whether to pay for costly treatments out of pocket, with the very real possibility of not getting reimbursed -- or simply say 'no' and forego the care they desperately need."

DMHC regulates health plans that cover more than 25 million Californians. Under California law, DMHC is required to immediately process urgent appeals of health plan denials, and to generally provide decisions within three days. The lawsuit cites examples of patients and providers waiting up to six weeks for determinations.

"The longer it takes to receive urgent appeal decisions, the greater the harm to patients and to providers," said Mendi Baron, CEO at Evolve, which operates adolescent mental health and substance abuse treatment facilities in California and New York. "While Evolve does not discharge patients pending appeals, we find that if they can't pay for treatment themselves, many patients simply won't stay in treatment. Also, mental health providers often delay or terminate care instead of taking on the risks associated with these delayed appeals. DMHC may tout mental health parity, but its practices are making a mockery of actual mental health care."

Evolve Growth Initiatives, LLC v. California Department of Managed Health Care, et al. was filed in the Los Angeles County Superior Court. In addition to allegations that DMHC routinely violates the statutory and regulatory deadlines established for expedited appeals, the lawsuit asserts that DMHC has attempted to cover up its unlawful practices by failing, over many months, to produce relevant documents and data in response to Evolve's California Public Records Act request.

About Psych-Appeal, Inc.
Los Angeles-based Psych-Appeal, Inc. is a law firm exclusively dedicated to mental health insurance claims, advocating on behalf of patients, clinicians and treatment facilities to overcome insurer denials of treatment. For more information, visit www.psych-appeal.com.