ERISA and Mental Health Coverage

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In the recent case of Emch v. Community Insurance Company d/b/a Anthem Blue Cross and Blue Shield, No. 1:17-CV-00856, 2019 WL 5538196 (S.D. Ohio Oct. 25, 2019), the plaintiff filed a putative class action alleging that an employer-sponsored health insurance plan improperly denied claims for residential mental health services for the plaintiff’s minor son. Notably, the plaintiff alleged that Ohio Rev. Code § 3923.281 (the Ohio Parity Act), a mental health parity statute in Ohio state law, was incorporated into the terms of the plan through a “Conformity with Law” clause, empowering him to seek relief through ERISA for alleged violations of the Ohio Parity Act.

The court denied the defendant’s motion to dismiss the complaint, holding that the plaintiff had stated plausible claims for relief under 29 U.S.C. § 1132(a)(1)(B) and 29 U.S.C. § 1132(a)(3) because the plan incorporated the Ohio Parity Act’s requirement that plans cover the “diagnosis and treatment of biologically based mental illnesses on the same terms and conditions as, and … provide benefits no less extensive than, those provided under the policy of sickness and accident insurance for the treatment and diagnosis of all other physical diseases and disorders ….” Ohio Rev. Code § 3923.281(B); see Emch, 2019 WL 5538196, at *3.

The court analyzed two prior district court cases where plaintiffs had argued that state mental health parity laws were incorporated into their plans: Bushell v. Unitedhealth Group, Inc., No. 17-CV-2021, 2018 WL 1578167 (S.D.N.Y. Mar. 27, 2018), and A.F. ex rel. Legaard v. Providence Health Plan, 35 F. Supp. 3d 1298 (D. Or. 2014). The defense urged the court to follow the reasoning in Bushell that rejected a similar claim and cautioned that it would improperly expand the scope of relief available under ERISA. See Bushell, 2018 WL 1578167 at *4 (holding that the plaintiff “cannot enforce” a New York mental health parity law “under the guise of an ERISA claim” and noting that a contrary conclusion “would mean that this one provision allows suit for violation of any state or federal law”). But the court followed the reasoning in Legaard that a plaintiff has standing to enforce provisions of state statutes incorporated into her plan through ERISA. See Legaard, 35 F. Supp. 3d at 1305 (holding that plaintiff had stated a cause of action under 29 U.S.C. § 1132(a)(3) for violation of the Oregon mental health parity statute, and that “ERISA provides courts with the power to enjoin violations of state law regulating insurance that have become part of the terms of the plan”). The Emch litigation continues following the court’s denial of the motion to dismiss. This case is discussed at this link: https://www.jdsupra.com/legalnews/recent-decisions-addressing-mental-69640/