Stone v. UnitedHealthcare Ins. Co., __ F.3d __, 2020 WL 6556332 (9th Cir., Nov. 9, 2020)
Suzanne Stone had a health care plan governed by ERISA. Stone’s daughter received in-state treatment for an eating disorder that was approved by the plan administrator, but was discharged with a referral to a facility in Colorado offering a higher level of care. The ERISA plan excluded coverage for health services rendered “outside the service area” of California. Stone enrolled her daughter at the Colorado facility, then sued the plan administrator for denying coverage and disadvantaging treatment for mental illness. The district court granted the administrator’s motion for summary judgment, ruling that the plan’s limitation of coverage to California was valid because it applied equally to mental and physical health services. Stone appealed.
The Ninth Circuit affirmed, rejecting Stone’s contention that California Parity Act guarantees a substantive right to medically necessary treatment of listed mental illnesses. The court explained that the Act requires plans to cover medically necessary treatments of mental illnesses (including eating disorders) under the same terms and conditions of other medical conditions. Similarly, the Federal Parity Act requires plans to have benefit limitations for mental health issues that are “no more restrictive” than those for other medical issues. Here, the plan administrator violated neither act because the plan’s geographic limitation applied equally to all health treatments. The Court explained that excluding coverage of the out-of-state treatment was not an improper denial of an entire type of medically necessary treatment; rather, it was a proper threshold condition of plaintiff’s plan that applied equally to all benefits.
