SALEM, OR (August 14, 2014) -- Acting in response to a string of successful lawsuits against the insurance industry, an Oregon state agency announced today that it would prepare a directive requiring all private health insurers to cover applied behavior analysis (ABA) for autism.
“Recent court decisions have brought clarity that coverage for ABA therapy should be required of all insurers,” said Insurance Commissioner Laura Cali. “After evaluating the latest ruling made in Oregon last week, we have determined there are limited circumstances in which denial of coverage for ABA therapy as a treatment for autism may be reasonable. We hope the bulletin will provide more certainty to Oregon families who seek this treatment.”
Cali was referring to last week's decision by U.S. District Court Judge Michael Simon striking down the use of a "developmental disability exclusion" by insurers to deny claims for ABA treatment for autism. The ruling came in a class action lawsuit brought by two families against Providence Health Plans.
Simon found that the disabilities exclusion violated federal and state mental health parity law.
In a previous case, McHenry v PacificSource Health Plans, the court struck down the insurer's claims that ABA was "experimental" and "educational," rather than medical, in nature. The health plan administered by the Oregon Public Employees Benefits Board (PEBB) is currently being sued for its refusal to cover ABA, while in neighboring Washington state a series of decisions in class action suits have run against insurers.
Last year, Gov. John Kitzhaber signed legislation requiring state-regulated health plans to cover ABA, but the requirement would not take effect until 2016.
The Oregon Insurance Division, which is part of the state Department of Consumer and Business Services, has the authority to issue bulletins to clarify requirements of insurance companies under the Oregon Insurance Code and other state and federal laws.
"This bulletin will explain that insurers cannot exclude coverage of ABA therapy for autism from their policies," the Insurance Division announced in a statement. "As with other types of medical services, insurers can make coverage decisions based on whether the therapy is deemed appropriate and medically necessary for an individual patient, but they cannot broadly deny payment for ABA therapy."
The state will begin drafting the bulletin "immediately" and share the draft with consumers, advocates, insurers, and other interested parties, for comment and feedback. The division also promised to develop a "transparent and consistent approach" for resolving current and future consumer complaints and enforcing the bulletin.
The Insurance Division has drawn fire in the media for purportedly maintaining a cozy relationship with the state's insurance industry. As reported by The Oregonian, a draft memo analyzing the 2013 autism insurance reform bill was shared with a lobbyist for Regence Blue Cross Blue Shield while the bill was still before the Legislature.
Cali took over as director shortly after the episode and told The Oregonian she was making improved autism insurance coverage a priority for the Insurance Division.