Parents of Autistic Children Call on the Brown Administration to Comply With State Law and End Coverage Discrimination

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Sacramento, CA – Autistic children with health insurance coverage regulated under the Brown administration’s Department of Managed Health Care (DMHC) are routinely denied access to treatment in violation of state law while children whose policies are regulated by the Department of Insurance (DOI), led by Insurance Commissioner Dave Jones, get the care they need, according to Consumer Watchdog and parents of autistic children testifying today at a Senate hearing in Sacramento.
Consumer Watchdog said the DMHC’s willingness to settle an on-going lawsuit brought by the consumer group against the DMHC under the Schwarzenegger administration will be a litmus test of whether the Brown administration is committed to caring for autistic children.
“It is simply outrageous that whether autistic children get the care they need depends on which government regulator oversees their parents’ insurance company,” said Jerry Flanagan, staff attorney for Consumer Watchdog. “We urge the Brown administration to reverse the Schwarzenegger-era pro-insurer policies that illegally cut off access to needed care and severely undermine the health and safety of some of the state’s most vulenerable residents. Beyond the harm to severely ill children, insurers’ refusal to provide treatment for autistic kids eventually leaves taxpayers to pick up the tab.”
Download Consumer Watchdog’s letter to Governor Brown urging him to end the Schwarzenegger-era policies:

Beginning in March of 2009, the DMHC made a policy change to allow insurance companies it regulates to refuse to pay for an essential treatment for autism – Applied Behavioral Analysis (ABA) – on the grounds that ABA is “educational” and not “medically effective,” and paradoxically on the grounds that ABA providers are not “licensed” even though no such state license exists.
The DOI, enforcing the same state law as the DMHC – the Mental Health Parity Act – unequivocally requires health insurers it regulates to pay for ABA, citing overwhelming medical literature that ABA is the most effective medical treatment for autism, and finding that ABA providers are not required to be licensed as a condition for coverage under insurance contracts.
Consumer Watchdog and co-counsel Strumwasser & Woocher sued the DMHC, in part, over its requirement that ABA providers must be licensed as a condition to be covered under insurance contracts. Recent reports suggest that the DMHC might be shifting away from this strict requirement in some instances, but Consumer Watchdog said that unless the DMHC enters into a binding settlement of the lawsuit autistic children will continue to face illegal denials of care.
As a result of the DMHC’s March 2009 policy change, children face delays of up to a year or more to resolve disputes with their insurers that prior to the change took just 30 days to resolve.   The huge delays put the health and safety of autistic children at risk.
The DMHC’s March 2009 policy change allowing insurers to refuse to cover ABA was one that was lobbied for by a health insurance industry looking to boost profits and adopted under the Schwarzenegger administration, well known for its partiality to health insurers. Schwarzenegger received $1,349,850 in campaign contributions from health insurance companies as governor.
When private insurance companies refuse to pay for an autistic child’s care, the financial burden ultimately falls on the public, either through the state Department of Developmental Services Regional Centers or through the school districts.
Under the current DOI process, previously in place at the DMHC before the March 2009 policy change, independent medical professionals review ABA denials.  Under the DMHC’s current practices, government bureaucrats uphold insurance company denials of ABA when providers are unlicensed.
Because the state presently has no specific licensing program for ABA therapists, very few medical professional who are state-licensed in related fields possess the necessary training to conduct ABA. The most skilled practitioners are instead certified by the Behavior Analysis Certification Board, the same national organization that the state itself relies on to decide which therapists are qualified to provide ABA services through its Regional Centers.
Currently, the California Legislature is considering legislation to adopt a new licensing program for ABA providers. Consumer Watchdog said that until that law is adopted, government regulators cannot use licensure as an excuse for denying coverage.
The DMHC regulates health insurers covering 22 million Californians. The DOI regulates health insurers covering 5 million Californians. In many cases, the policies covered by one agency are indistinguishable from policies covered by the other.

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Consumer Watchdog is a non-partisan and non-profit public interest organization with offices in Washington D.C. and Santa Monica.  Pamela Pressley is its Director of Litigation.  For more information, go to:

Strumwasser & Woocher LLP is known for its successful litigation and resolution of major public policy matters.  The firm’s trial and appellate civil litigation practice focuses on government and electoral law, consumer law, environmental protection, land use, and administrative law. For more information, go to:

Jerry Flanagan
Jerry Flanagan
Jerry Flanagan is Consumer Watchdog's Litigation Director. Flanagan leads Consumer Watchdog’s litigation efforts in the areas of health insurance coverage and access to treatments. He has over 20 years experience working in public interest and health care policy, legislation and litigation.

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