How to Obtain Health Insurance Coverage for ASD Therapies Under New Jersey Law
Written by Jodi F. Bouer, Esq.
As a New Jersey law firm that specializes in representing policyholders seeking health insurance coverage, we have been asked to draft the following practical guide on how to use New Jersey law to obtain health insurance coverage for children in this state who need autism-related therapies. This guide also contains many tips which can be used by insureds and families with children on the autism spectrum that do not enjoy the right to coverage under New Jersey law.
A. The New Jersey Autism Insurance Bill Many families in New Jersey with children on the autism spectrum have long been hoping to tap into the health insurance coverage promised by the Autism Insurance Bill that was signed into law in the summer of 2009. According to Autism Votes, some form of this bill has been passed in 15 states throughout the country and is pending in another 20 states.
To determine if the Autism Insurance Bill will apply to your insurance policy, you first need to call your insurer and/or employer to determine whether your policy is state regulated or an ERISA/federally-regulated insurance plan. This is important because the bill only applies to state-regulated insurance policies. If you have a state-regulated policy, the Autism Insurance Bill:
- Prohibits the denial of coverage on the basis that therapy is not restorative.
- Requires screening and diagnosis of autism and other developmental disabilities.
- Requires coverage for expenses incurred for medically necessary occupational, physical and speech therapy:
- As prescribed through a treatment plan
- When a covered person‘s primary diagnosis is autism or other developmental disabilities
- Requires a “maximum benefit amount” of $36,000 in coverage for expenses incurred for medically-necessary behavioral interventions based on the principles of ABA and related structured behavioral programs
- When a person is under 21 years old, and
- The primary diagnosis is autism and therapy is prescribed through a treatment plan
A bulletin (No. 10-02) was issued by the New Jersey Department of Insurance (“DOBI”) that clarifies these and other issues.
Most importantly, under the Federal Mental Health Parity law, DOBI notes in the bulletin that state-regulated group health insurers (not individual insurers) are generally prohibited from including more restrictive benefits and services for the treatment of mental illness than provided for under other medical provisions in an insurance plan. Thus, DOBI concludes that under the Federal Mental Health Parity Act, group health insurers generally have to cover ABA therapy as required by the Autism Insurance Bill but may not apply the $36,000 ABA limit to ABA claims because no such limit is likely to apply to medical benefits in such plans.
A few other questions have cropped up about the Autism Insurance Bill, such as: 1) When will it go into effect, and 2) Which diagnoses on the autism spectrum will enjoy the benefit of the bill‘s ABA coverage requirement?
First, the bulletin states that the bill will be implied into insurance plans that renew on or after February 9, 2010. Thus, if your health plan renews before that date, the bill will not be implied into your insurance policy until it renews the next policy year or unless your insurer voluntarily agrees to imply the terms of the Autism Insurance Bill into your insurance policy, regardless of the fact that your policy renews after February 9, 2010 (we have clients with such policies). A call to your insurer should clarify whether the bill applies to your plan regardless of when your plan renews.
Second, the bulletin requires insurers to apply the new bill‘s statutory requirement to several conditions classified as Pervasive Development Disorder in the Diagnostic and Statistical Manual of Mental Health Disorders, Fourth Edition — which are given an ICD-9 diagnostic 299 code. Thus, the ABA requirements of the new bill apply to autistic disorder, Asperger's Disorder and PDD-NOS. The bulletin specifically exempts children diagnosed with Rett's disorder or childhood disintegration disorder from the definition of autism and therefore, allows insurers to deny coverage for ABA therapy for children with these conditions. DOBI directs insurers to consider whether these diagnoses fall within the definition of a developmental disability as defined by New Jersey statute N.J.S.A. 30:6D-3 so that these children might still enjoy the benefits of speech, occupational and physical therapies required by the new bill. Again, a call to your insurer should clarify whether your child should fall within the bill‘s definition of autistic or developmentally disabled.
The bulletin also addresses a very significant issue that has cropped up in many of ASD insurance coverage cases handled by this firm over the past year (and which has been reported throughout the country).
Although insurers in New Jersey often recognize a coverage obligation for ABA therapy either under the New Jersey Mental Health Parity Act (discussed below) or because it is really almost impossible for them to assert that such treatment is experimental given the general acceptance in the medical community and by many state legislatures, insurers often attempt to overcome their obligation to cover ABA therapy by asserting that insurers are not required to cover therapy provided by unlicensed providers. New Jersey, like many other states, does not have a licensing requirement for ABA providers. Thus, many insurers impose a licensing requirement that does not exist in order to circumvent their obligation to provide health insurance coverage to children on the autism spectrum.
DOBI closed the door on this argument under the Autism Insurance Bill in the bulletin when it stated:
The DOBI is also aware that most states, including New Jersey, have no professional license for ABA practitioners. There are, however, voluntary credentials that practitioners of ABA may obtain through the national Behavior Analyst Certification Board upon satisfaction of one or more very robust sets of standards. The DOBI does not construe [the new bill] as requiring carriers to pay for services for the treatment of autism without regard to practitioner qualifications. Consequently, the DOBI believes carriers should consider behavioral interventions based on ABA and related structured behavior program services eligible for benefits if administered directly by or under the direct supervision of an individual who is credentialed by the national Behavior Analyst Certification Board as either:
- a Board Certified Behavior Analyst – Doctoral (BCBA-D); or
- a Board Certified Behavior Analyst (BCBA). Bulletin No. 10-02 (emphasis added).
Up for grabs is what DOBI meant by the term “direct supervision.” Insurers are already attempting to narrow their obligations by asserting that a BCBA has to be the first layer of supervision over the therapists and shadows working directly with the children in the field. For some ABA providers, this type of supervision may be hard or impossible to provide because they do not have enough BCBAs on staff. ABA providers should start to beef up their staffs with BCBAs. Insureds should broadly query about specific insurer requirements, provide this information to their providers and then the providers may have to be creative in restructuring their programming and billing practices by adding additional layers of supervision in order to help their clients maximize coverage reimbursements.
Significantly, if the Autism Insurance Bill will not apply to your policy until it renews, you are still faced with the argument that your provider is not licensed and therefore your insurer has no obligation to cover your child‘s ABA therapy. If you are a New Jersey resident, you can respond to that under the New Jersey Mental Health Parity Act (see below) this issue was squarely addressed by the New Jersey Supreme Court in Micheletti v. State Healthcare Benefits Commission, 192 N.J. 588 (2007) (ordering payment of speech, physical, occupational and behavioral therapy). The oral argument before the Supreme Court indicates that the insurer attempted to overcome an Appellate Court ruling that it pay for the insured's ABA therapy by asserting that the therapist was an unlicensed BCBA. The Supreme Court would have none of this argument and, in fact, ordered the insurer to pay the claim regardless of the lack of license.
If New Jersey law does not apply to your insurance policy, review the policy language carefully to poke holes in your insurer's assertion that only licensed practitioners may provide ABA therapy. This firm has reviewed many insurance policies that do not clearly require the provision of all services by licensed practitioners. Make sure that your insurance policy states in clear and concise terms that the policy only covers services provided by licensed practitioners and if not, assert that the policy is ambiguous and should be construed in favor of coverage.
Finally, in order to get around a licensing requirement, you should see if it is possible for your ABA provider to associate with a licensed provider such as a medical doctor or a licensed psychologist, psychiatrist or social worker. Health insurance policies generally define licensed practitioners to include these professions. Once your ABA provider associates with a licensed practitioner, the basis of your insurer‘s denial no longer exists.
B. The New Jersey Mental Health Parity Act
As explained above, the Autism Insurance Bill is not applicable to all state-regulated insurance policies at this time (only those that renew on after February 9, 2010) so some insureds still have to rely upon the statute that predated the bill, the New Jersey Mental Health Parity Act (the “Parity Act”). The Parity Act is mighty weapon, unique to New Jersey, that can be used by insureds to obtain coverage for the therapies needed by ASD children. This statute also only applies to state regulated insurance policies. It requires insurers to provide “coverage for biologically-based mental illness under the same terms and condition provided for any other sickness under the contract.” N.J.S.A. 17:48-6v. The Parity Act defines biologically-based mental illness to mean: a mental or nervous condition that is caused by a biological disorder of the brain and results in a clinically-significant or psychological syndrome or pattern that substantially limits the functioning of the person with the illness, including but not limited to pervasive development disorder. The same “terms and conditions” is defined to mean that insurers cannot apply different copayments, deductibles or benefit or visit limits, preauthorization requirements to biologically-based mental health benefits than those applied to other medical or surgical benefits. See e.g. N.J.S.A. 11:4-57.3.
Under the Parity Act, insurers cannot deny coverage because: The illness is chronic
- Medically necessary therapy is long-term
- Medically necessary therapy is not restorative
- The illness involves behavioral problems
- The illness is otherwise defined as a developmental or learning disability/delay
- A defined period of time has elapsed from date of injury or onset of illness
- See N.J.A.C. 11:4-57.3
Even more promising for insureds in New Jersey is the fact that case law interpreting the Parity Act bars insurers from denying coverage on the basis of the:
- Non-Restorative Exclusion
- Developmental Disability Exclusion and
- Educational Exclusion.
See Micheletti v. State Healthcare Benefits Commission, 389 N.J. Super. 510 (App. Div. 2007) (barring reliance on non-restorative exclusion); Markiewicz v. State Healthcare Benefits Commission, 390 N.J. Super. 289-99 (App. Div. 2007) (barring reliance on developmental disability and educational exclusions).
The courts in New Jersey further bar insurers from denying coverage for the medically necessary therapies used to treat ASD, such as speech, occupational and physical therapy, and have extended that coverage obligation to ABA therapy. The Appellate Division reasons that to “allow carriers to exclude the primary mode of treatment for autism and pervasive development disorder … would render the statutory directive”in the Mental Health Parity Law meaningless.
Thus, as indicated above, under the Parity Act, the New Jersey Supreme Court has required an insured be reimbursed for ABA therapy even though the provider, a BCBA, was not a licensed provider in the state of New Jersey. Micheletti v. State Healthcare Benefits Commission, 192 N.J. 588 (2007) (ordering payment of speech, physical, occupational and behavioral therapy).
Taking things a step further, Administrative Code interpreting the Parity Act requires insurers to apply the Act‘s benefit limits only “if those benefit limits … are applicable to treatments of physical illnesses” N.J.A.C. 11:4-57.3 (b). This requirement is stupendous! ABA therapy is only provided to children on the autism spectrum and not to those insureds suffering from any other medical conditions. Thus, under the Parity Act which predates the Autism Insurance Bill, arguably insurers cannot limit the amount of ABA therapy covered under their respective provisions because the insurers cannot limit this therapy in relationship to other medical conditions, generally.
In fact, as a law firm representing many families with ASD children, we have been resoundingly successful in getting insurers to admit to this unlimited obligation under the Parity Act. The Autism Insurance Bill, in contrast, reads a $36,000 limit into state regulated policies, which essentially cuts back on the coverage required by the Parity Act.
Thus, we encourage you to make your ABA claims timely. You may find out that you had unlimited coverage this past year; money which, if reimbursed, can be used to supplement your child‘s services when coverage decreases to $36,000 under the Autism Insurance Bill.
C. Insurance Plans Regulated By ERISA/Federal Law
Do not despair if your insurance plan is governed by federal and not state law. ERISA is a federal law that allows employers to step outside of state insurance law to draft, fund, administer (and purchase) insurance plans for their employees, such insurance plans do not have to comply with state insurance law.
Generally speaking, ERISA allows employers to make coverage determinations which are only overturned if arbitrary and capricious. Insurers like to assert that this standard is almost insurmountable – rest assured, IT IS NOT. The arbitrary and capricious standard can be overcome, especially when there are procedural anomalies, a conflict of interest or vague and ambiguous language in plan documents which do not adequately inform employees of their right to coverage and the obligations of the parties.
Under ERISA, if your plan has any ambiguities, coverage will be interpreted in your favor. Federal law is currently in a great state of flux on the issue of compelling insurers country-wide to cover autism-related therapies and at least by 2014, or even sooner, may restrict the application of annual limits on autism-related therapies. By the time you make your claims, coverage under federal health care reform act may be securely amended to require your insurer to provide your child with some coverage for his or her autism-related therapies. Your employer‘s plan may also be constrained by the Federal Mental Health Parity Act which prohibits insurers that cover mental illness from limiting coverage benefits for ABA or other therapies when such limits do not apply to other medical conditions. As such, we strongly encourage you to make these claims as soon as possible to avoid limiting your reimbursement opportunity for failure to timely make your claims.
D. How To Argue for Coverage and Win Regardless of Whether State or Federal Law Applies to Your Insurance Policy
Whether you have a state-regulated or an ERISA/federal plan, the following analysis applies to combat any denials of coverage.
First, you should call your insurer and check your time limit to make claims, and get your ABA therapy claims filed with your insurer within that time frame. Advise your insurer of your child's diagnosis and treatment plan and inquire about whether the relevant therapy is covered, any limits, exclusions etc.
Second, you should obtain a copy of your insurance policy and confirm what you were advised. Determine:
- Annual and aggregate limits
- Cost share
- Exclusionary language
- Out-of-network coverage
- Number of visits allowed
- Maximum days of coverage
If your policy has a maximum limit per diagnosis, use as many diagnoses as you can, in turn, until you have maximized your coverage obligation for that diagnosis and then move on to the next diagnosis and make your claims thereunder. If the number of diagnoses is not relevant, find out which one is covered for the therapy you need and then simply use that one diagnosis.
Third, when your insurer inevitably attempts to deny coverage, scrutinize the language in your insurance policy carefully. Whenever possible, argue that:
- Your insuring agreement should be construed broadly in favor of covering ABA and any other medically-necessary treatment for ASD
- Ambiguities in the policy should be construed in favor of coverage
- Exclusionary language is construed narrowly, in favor of coverage
- Procedural anomalies occurred which indicate your insurer is singling your child out to deny coverage not because the therapy is not covered, but rather because the insurer simply doesn‘t want to pay for the therapy at issue
- The insurer failed to comply with state or federal law or code
- The insurer failed to comply with policy terms and limitations
- Treatment is a medical necessity and appropriate, not experimental – insurers can no longer argue in New Jersey that ABA therapy is experimental because both the New Jersey Supreme Court and the state legislature has deemed the therapy medically necessary and appropriate to treat ASD.
- Medical files show past and expected progress and continuing need, and
- Proper coding was used by your therapist
Finally, don't give up hope! Make your claims and appeals timely or they will be forever barred! And please, unless you are certain that no coverage exists, appeal all denials of coverage. When in need, reach out to insurance advocates for support. In our practice, we continually are confronted by insurance companies who count on the fact that you are so overwhelmed by your child's illness that you will likely not appeal a denial of coverage, however erroneous, ill-conceived or contrary to law. Often a call to your insurer to clarify issues, resubmitting the claims or providing supporting information is sufficient to overcome a denial of a claims or a preauthorization request. Appeals are time-consuming to prepare but worth the effort when you consider that your child‘s progress and your family‘s financial well-being are at stake.
Disclaimer: The above is a general summary of the law. It does not address the provisions and exclusions in your insurance policy including, but not limited to, the timing in which your claims must be made or will otherwise be barred, preauthorization requirements which may limit or otherwise bar your coverage, or medical necessity which is required to invoke insurance coverage under most insurance plans. To determine your obligations and the obligations of your insurer, you should review your policy, consult your insurance agent or broker, consult counsel and make your claims accordingly.
An attorney-client relationship is not created by the provision of this summary. The Law Office of Jodi F. Bouer, LLC, 84 Hardy Dr., Princeton New Jersey, 08540. Phone: 609-924-3990; Fax: 609-964-1776.