SOURCE: Psych-Appeal, Inc.

Psych-Appeal, Inc.

March 26, 2015 09:58 ET

Federal Court Rules That Exclusion of Residential Treatment May Violate Federal Parity Act

CHICAGO, IL--(Marketwired - Mar 26, 2015) - On Wednesday, March 25, 2015, the United States District Court for the Northern District of Illinois ruled that an insurer's blanket exclusion of residential treatment is "arguably at odds with [the Federal Parity Act's] purpose to achieve coverage parity whenever a plan offers both mental-health and medical/surgical benefits."

In the fall of 2014, the law firms of Barnhill & Galand P.C., Zuckerman Spaeder LLP, and Psych-Appeal, Inc. filed a class action suit, Craft et al. v. Health Care Service Corporation, on behalf of an adolescent struggling with anorexia, depression, and post-traumatic stress disorder whose claims for residential treatment were categorically denied following nine psychiatric hospitalizations. Residential treatment is often the most appropriate, if not the only suitable level of care for individuals with chronic mental health or substance use disorders, which are frequently under-diagnosed and under-treated. 

"When patients do not have access to all levels of mental health services across the continuum of care, their welfare can be imperiled," said Meiram Bendat of Psych-Appeal, Inc.

Plaintiffs' counsel are interested in hearing from individuals whose residential treatment claims were excluded or denied by any of HCSC's units, including Blue Cross and Blue Shield of Illinois, Texas, New Mexico, Montana, and Oklahoma. 

The federal court held that "[t]he practical effect of the [residential treatment] exclusion is that Jane Doe receives fewer hours (or days) of coverage for medically necessary nursing care than, for example, an elderly person would receive to rehabilitate a broken hip." 

"This is a grave disparity in health coverage that we will continue to challenge through litigation," added Brian Hufford of Zuckerman Spaeder LLP.

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

Interested parties may contact Meiram Bendat at or Brian Hufford at

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