Legal News

Aetna Agrees to Treat Eating Disorders Like Mental Illness

By Dan Slater

Some good insurance-related news for those afflicted with eating disorders: You’re covered. In a recent settlement with some 100 New Jersey policyholders, Aetna has agreed to pay $250,000 in reimbursements to those whose claims were denied and to expand coverage for anorexia and bulimia. Here’s the story from the New Jersey Law Journal.

The agreement, if approved by District Judge Faith Hochberg, would settle a class action suit in federal court in Newark brought by insureds seeking the same benefits for anorexia and bulimia that are available in cases of biologically based mental illnesses — known as BBMI’s — such as schizophrenia. Historically, BBMI patients could get coverage for years of treatment, while those with eating disorders, typically classified as non-BBMI’s, were limited, under Aetna’s policy, to 20 outpatient visits per year and 30 days of inpatient benefits.

In addition to the reimbursements, Aetna would also pay up to $350,000 in legal fees to the firm that brought the suit, Nagel Rice in Roseland, N.J., and pay $10,000 to the two lead plaintiffs.

Plaintiffs’ counsel Bruce Nagel said that the settlement is “believed to be the first in which a health insurer in New Jersey has agreed to cover eating disorders such as anorexia nervosa and bulimia under the same terms and conditions as biologically based mental illnesses.”

But the settlement still needs to be approved, and it could face opposition. Nagel’s former law partner, Eric Katz of Mazie Slater Katz & Freeman, says he’s been retained by a member of the Aetna class to ask Judge Hochberg to reject the settlement. Katz is critical of the settlement’s restriction of future BBMI benefits to claimants in “fully insured” plans — i.e. plans funded by employers.

Katz and Nagel, reports the New Jersey Law Journal, are estranged former partners from a firm, Nagel Rice & Mazie, that underwent a bitter breakup in 2007. But Katz says his criticism is based on a career in health law and is “completely objective.”

Full post as published by Law Blog - WSJ.com on June 03, 2008 (boomark / email).