Kuderer fines Kaiser $300,000 for MHPAEA violations

OLYMPIA, Wash. — Washington state Insurance Commissioner Patty Kuderer fined Kaiser Foundation Health Plan of Washington $300,000 on Wednesday, Jan. 7, for violations of the Mental Health Parity and Addiction Equity Act (MHPAEA), with $100,000 suspended.

“I’ve seen a trend among our state’s largest health insurers of mental health parity issues,” Kuderer said. “The market scans that started our work on these violations was an important step and I’m glad to see these issues corrected so Washingtonians have the access they deserve to these important services.”

The Office of the Insurance Commissioner (OIC) issued a behavioral health market scan in March of 2019 and received incomplete responses from Kaiser, which prompted a second market scan in January of 2020.

The second market scan called for comparative analysis of utilization management, provider admission standards, provider directory, and network adequacy non-quantitative treatment limitations. 

MHPAEA requires health carriers to provide documentation explaining the treatment limitations within the plan and how those limitations compare between behavioral health benefits and medical and surgical benefits offered by the carrier’s health plans. Insurance companies must provide the OIC with that information upon request.

Kaiser failed to provide sufficient documentation for two treatment limitations — provider admissions standards and network adequacy. 

Additionally, it couldn’t provide detailed documentation showing how it initially worked to address disparate results in provider reimbursements and network adequacy standards. 

Kaiser did, however, provide information on how it worked to remedy these discrepancies after the OIC initiated a continuum action to address the results of the second market scan.

Kuderer agreed to suspend $100,000 of the fine if Kaiser commits no further MHPAEA violations for two years and meets the conditions of a compliance plan.

Kuderer previously fined Regence BlueShield $550,000 in November and Premera $550,000 in August for mental health parity violations.