Written by Jodi F. Bouer, Esq.
As a New Jersey law firm that specializes in representing providers and policyholders seeking health insurance reimbursements, we at Bouer Law have been asked to draft the following updated and practical guide on how to use New Jersey law to obtain health insurance coverage for children in this state who need therapies for Autism Spectrum Disorder (ASD). This guide also contains many tips which can be used to compel coverage by providers for families with children with ASD that do not enjoy the right to coverage under New Jersey law.
A. The New Jersey Autism Insurance Mandate
Many families in New Jersey who have children with ASD have been tapping into the health insurance coverage compelled by the Autism Insurance Mandate (the “Mandate”) that was signed into law in the summer of 2009. According to Autism Speaks, some form of this bill has been passed in most states throughout the country.To determine if the Mandate will apply to your insurance plan, you first need to call your insurer and/or employer to determine whether your policy is state-regulated or is a self-funded insurance plan. Generally speaking, if your employer has less than 50 employees and is based in New Jersey, the Mandate will apply to your insurance plan. If your employer has more than 50 employees and is based in New Jersey, you can tell if the plan is state regulated if the appeals section allows you to make a third level external appeal to the New Jersey Department of Banking and Insurance (“DOBI”). If the plan documents indicate that they are self-funded, appoint an insurer as claims administrator, or do not allow for an external review to DOBI, the plan is likely self-funded. New Jersey regulations also require your insurance card to state if your plan is self-insured/self-funded, so you can review your card for such a reference.
Determining whether your insurance plan is state regulated is important because the Mandate only applies to state-regulated insurance plans and the New Jersey insurance plans that cover state workers (and most New Jersey teachers). If you have a state-regulated plan, the Mandate:
- 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; and
- Requires coverage for medically necessary ABA therapy as prescribed through a treatment plan to treat a primary diagnosis of ASD.
The Mandate was originally written so that it allowed insurers to impose a $36,000 limit on Applied Behavior Analysis (ABA) therapy provided to children with a primary diagnosis of ASD, but only up to the age of 21.
GOOD NEWS! Since the enactment of the Affordable Care Act, which imposes federal mental health parity requirements on almost all insurance plans, the DOBI has interpreted the Mandate to have no monetary or age limits.
MORE GOOD NEWS! Additionally, based on federal mental health parity law, DOBI has also determined that insurers in New Jersey can no longer place visit limits on speech, occupational therapy and physical therapy when prescribed to treat ASD.
Please keep in mind that in New Jersey, the Mandate has been interpreted to require a diagnosis of ASD by a physician. Services compelled under the Mandate must be provided only when ASD is the child’s primary diagnosis and a physician indicates that the services are “medically necessary” to treat the child’s ASD diagnosis.
The Mandate also specifies that therapy must be prescribed through a “treatment plan.” Although the Mandate references a physician creating the treatment plan, many insurers in the New Jersey currently allow and even require BCBA’s and other therapy providers to create a child’s treatment plan. That being said, you should check the insurer’s guidelines to determine whether a physician needs to either prepare the treatment plan or approve and sign off on a child’s treatment plan.
The Mandate is also very specific in regards to the elements that must be included in a treatment plan. Whether a treatment plan is for ABA therapy or other specifically mandated therapies (speech, occupational and physical therapy), it is required to include “all elements necessary for the insurer to appropriately provide benefits, including, but not limited to: a diagnosis; proposed treatment by type, frequency, and duration; the anticipated outcomes stated as goals; the frequency by which the treatment plan will be updated; and the treating physician’s signature.
Finally, the Mandate also specifies than an insurer “may only request an updated treatment plan once every six months …[to] review medical necessity, unless the insurer and the treating physician agree that a more frequent review is necessary due to emerging clinical circumstances.” As such, unless it is to a child advantage, if an insurer tries to issue an authorization that is less than 6 months or requests treatment planning in less than 6 month increments, you should object based on the requirements of the Mandate and report the insurer to DOBI if it insists on proceeding in this direction.
New Jersey still has no regulations issued in relationship to the Mandate, so providers and parents should rely on Bulletin (No. 10-02) issued by DOBI, if they have any questions about what types of services are covered or compelled by the Mandate. DOBI Bulletin 10-2 describes ABA therapy services in detail and indicates that even though Board Certified Behavior Analysts (BCBAs) are not licensed healthcare providers in New Jersey, insurers should still consider BCBAs healthcare providers for the purposes of insurance reimbursements for ABA services. The Bulletin states:
Under Bulletin 10-2, 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).
Some insurers that are not subject to the Mandate will try to argue that they will not cover services provided or supervised by BCBAs as they are not licensed healthcare providers. Significantly, if your plan is self-funded and your insurer attempts to argue that your BCBA is not a licensed provider and therefore it has no coverage obligation, you can refer the insurer to Bulletin 10-2 and respond that no license is required in New Jersey for ABA therapy, and the DOBI recognizes BCBAs as healthcare providers for insurance reimbursement purposes. Moreover, 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), which predates the Mandate by two years. In the oral argument before the New Jersey Supreme Court, 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 plaintiffs’ claims regardless of his BCBA’s lack of a license.
If New Jersey law does not apply to your insurance plan, review the plan language carefully so you can 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 plan states in clear and concise terms that the policy only covers services provided by licensed practitioners and if not, you can also assert that the plan should not be interpreted in such a restrictive manner, especially in light of the fact that New Jersey does not require a license for BCBAs to be reimbursed by insurance under Bulletin 10-2.
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. He or she can also apply for a behavior analyst license in New York. Once your ABA provider associates with a licensed practitioner or obtains a New York license, the basis for your insurer‘s denial on lack of licensing will no longer exist.
B. The New Jersey Mental Health Parity Act
In New Jersey, children with ASD are also protected by the New Jersey Mental Health Parity Act (the “NJ Parity Act”). The Parity Act is a mighty weapon, unique to New Jersey, that can be used by insureds to obtain coverage for the therapies needed by children with ASD. Like the Mandate, the NJ Parity Act 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 NJ 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.
Under the NJ 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
For more information, 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 NJ 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).
Further, the courts in New Jersey 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 has reasoned that to “allow carriers to exclude the primary mode of treatment for autism and pervasive development disorder … would render the statutory directive” in the Parity Act meaningless.
Although the New J Parity Act may not apply to your insurance plan because it is self-funded, you can certainly still use the New Jersey court rulings in Micheletti and Markiewicz as a sword to respond to any insurer arguments that ABA therapy is experimental or not medically necessary to treat an ASD diagnosis. Although we can make you no promises in your specific case, when self-funded plans issued to large New Jersey employers have attempt to raise a medical necessity/experimental defense to coverage in relationship to our clients’ coverage demands/appeals, we have used this argument successfully to overturn denials in the course of settlement negotiations and/or appeals.
C. Insurance Plans Regulated By Federal Law
Do not despair if your insurance plan is governed by federal and not state law. The Employee Retirement Income Security Act (“ERISA”) is a federal law that allows employers to step outside of state insurance law to draft, fund, and administer insurance plans for their employees and 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, insurers cannot read exclusionary language into insurance plan documents. As such, if your plan has any ambiguities or does not actually state a basis to deny coverage that the insurer is relying on, coverage may be interpreted in your favor. The Affordable Care Act restricts almost all insurers from imposing annual and lifetime limits or denying coverage on the basis of preexisting conditions. Moreover, almost all insurance plans (group and individual) must comply with the Mental Health Parity and Addition Equity Act (the “Federal Parity Act). The Federal Parity Act broadly prohibits insurers from imposing more restrictive limitations on mental health treatments than are applied to substantially all medical and surgical benefits. This means that if your plan has visit limits, age limits or uses more restrictive utilization review criteria that are applied only to ASD-related therapies (or to ASD-related and a few other therapies), these types of limitations are in violation of the Federal Parity Act. For instance, if an insurer is making it harder for you to obtain an authorization, claim reimbursements or is using a more restrictive utilization criteria (like requiring parent participation or denying coverage) than is used for medical services, the insurer is violating the Federal Parity Act. You should appeal on this basis and immediately bring a complaint directly to DOBI at www.state.nj.us/dobi/consumer.htm#insurance.
We are also always glad to answer any emails on whether an insurer’s criteria are in violation of the Mandate, the NJ Parity Act, the ACA or the Federal Parity Act.
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 a self-funded insurance plan, the following analysis applies to combat any denials of ASD-related coverage.
First, you should call your insurer and check your referral requirements as well as your time limit to make claims/appeals, and get your ABA therapy claims and appeals 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 monetary or visit limits, exclusions, etc.
Second, you should obtain a copy of your insurance plan and confirm what you were advised. Review the plan to 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 visit limit, look at the policy to see if it has any similar limitation in the outpatient services section which applies to substantially all other outpatient medical services. If not, you should argue that the limitation is in violation of the Federal Parity Act.
Third, when your insurer inevitably attempts to deny or limit coverage, scrutinize the language in your insurance plan and utilization review criteria/denial letter 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;
- Utilization review criteria is more limiting or restrictive than applied to other medical conditions/services;
- Exclusionary language is not clear and the insurer cannot read exclusionary terms into a plan document – the fact that exclusions are reflected in an insurance guideline/criteria is not sufficient to all the insurer to deny 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;
- The insurer failed to comply with state or federal law and related regulations;
- The insurer failed to comply with policy terms, limitations and deadlines;
- ABA therapy 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 documentation shows 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 in a timely manner. When in need, reach out to an insurance advocate or an attorney for support.
In our practice, we are continually confronted by insurance companies who count on the fact that providers and parents are so overwhelmed that they will likely not appeal a denial of coverage, however erroneous, ill-conceived or contrary to law. Federal law requires that most insurers allow for an external appeal by a disinterested third-party. If you have a good case, make an external review request, but please figure out first whether the determination will be binding and if so, see an attorney to obtain opinion on whether it makes sense to bring an external appeal or instead, refrain from external appeal and pursue litigation. Remember that often times, 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 a child‘s progress and a 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 plan 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 plan, consult your insurance agent or broker, consult counsel and make your claims accordingly. Please also be advised that an attorney-client relationship is not created by this summary.
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.
Citation for this article:
Bouer, J. (2010). Consumer corner: How to obtain health insurance coverage for ASD therapies under New Jersey law. Science in Autism Treatment, 13(2), 32-37.