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California Insurers Told to Allow Speech Therapy

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Los Angeles, CAFollowing complaints of denied disability insurance made by California insurance policyholders, regulators in California have told insurance companies that they must allow speech and/or occupational therapy for patients. Some policyholders have complained about having their California insurance claim denied after they filed claims for speech or occupational therapy, which regulators say is medically necessary therapy.

According to The Sacramento Bee (11/18/13), the California Department of Managed Health Care warned three insurers, Health Net, Blue Shield, and Anthem Blue Cross, that they were illegally denying patients access to medically necessary therapies. All three companies allegedly violated state law by claiming speech and occupational therapy were not medically necessary. Although many complaints came from parents of children with autism who were denied speech therapy, they only made up 10 percent of complaints against companies, meaning other patients who required speech or occupational therapy were also allegedly denied their claim.

Court documents (enforcement matter no. 12-165, found online at wpso.dmhc.ca.gov) filed by the California Department of Managed Health Care note that the insurers’ actions violate the California Health and Safety Code. “Under the Act, speech and occupational therapy are required basic health care services, and therefore Respondent’s denial of coverage for speech and/or occupational therapy based on a lack of physical impairment is illegal and contrary to the Act. The Department has determined that Respondent’s denials of speech therapy should not have been denied based on coverage, but rather should have been reviewed to determine whether the services were medically necessary,” the department argued in its claim against Health Net of California. It further noted that at least one company continued to illegally deny claims for speech and/or occupational therapy.

An independent medical review found that the speech therapy and/or occupational therapy were medically necessary in 97 percent of 36 denied cases sent for review.

“Medically necessary speech therapy and occupational therapy are basic health care services which Respondent [Health Net of California] is mandated to cover,” the department wrote.

The companies were ordered to stop denying access to medically necessary speech therapy and/or occupational therapy. Additionally, Health Net was issued a fine for $300,000 for repeated violations of the law.

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