Connecticut Enforcement

Connecticut – State Executes Stipulation and Consent Order against 4 Health Plan Subsidiaries with over $1 Million in Fines and Education Payments (July 2020 and January 2021)

On July 30, 2020, the Connecticut Insurance Department published a market conduct exam involving Oxford Health Insurance (dba Oxford HealthPlans) and UnitedHealthcare Insurance Company. On January 1, 2021, these health plans and United Behavioral Health entered into a stipulation and consent order that included the payment of $575,000 in fines and $500,000 to fund education programs.

The examination covered three calendar years covering 2015 through 2017 and was limited to Connecticut business.  The audit covered a full range of insurance activities including the solicitation of new business, marketing and sales, agent licensing and appointment, underwriting and rating, policyholder services, compliant handling, network adequacy, provider credentialing, claim processing, company operations, and parity violations.  Elements of the review did include compliance with federal and state MH/SUD parity requirements as well.

Although many elements of the review were satisfactory, the insurance regulators identified several problem areas.  Here are some findings covering the health plans in a July 22, 2020 Market Conduct Report:

• NQTL Disclosure Requirements. The Respondents imposed nonquantitative treatment limitations (NQTLs) with respect to MH/SUD benefits and was, therefore, required to provide detailed explanations of how its analysis of its underlying processes, strategies, standards and other factors used to apply NQTL to MH/SUD and to medical surgical benefits have led the Respondent to conclude that the NQTLs were applied, as written and in operation, in a manner that was comparable     and not more stringent for MH/SUD than for medical/surgical services and was, consequently, in conformance with legal
• Lack of Documentation. The Respondent was unable to provide adequate documentation demonstrating compliant parity analyses, despite numerous requests and guidance from examiners, notwithstanding that it was noted that during the period under examination, the Respondent’s application of the NQTLs was contributing to operational outcomes that produced non-comparative predominant
• Other Parity Concerns. The following areas of concern were also noted, between the rate at which SUD providers and Medical Surgical Providers were accepting new patients in the out-of-network claims rate between MH, SUD and Med/Surg benefits, in the claims denial rate between SUD benefits and Med/Surg benefits, in the rate of fail-first and step therapy programming, applied utilization review management required and pre-authorizations between MH, SUD and Med/Surg benefits, in the average In-Patient stay rate and outpatient treatment/rehabilitation visit rate between SUD benefits and Med/Surgical benefits, in the rate of required pre-authorizations within the drug formularies between SUD Rx benefits and Med/Surgical Rx benefits, and, in the reimbursement rates between Med/Surgical providers, MH providers and SUD

In addition to the fine and education payment associated with the stipulation and consent order, the following findings were made:

• ASAM Guidelines. United Behavioral Health failed to utilize criteria consistent with the American Society of Addiction medicine (ASAM) Patient Placement Criteria.
• Parity Compliance Documentation. Oxford Health Insurance was unable to provide to the regulators documentation demonstrating compliant parity comparability analyses.  As a result, Oxford’s operations appeared to result in differing outcomes between MH/SUD benefits and medical/surgical benefits for claim denial rates, the application of fail-first and step therapy programming during the UM process, the average in-patient stay rates and outpatient treatment/rehab visit rates, pre-auth Rx requirements and provider reimbursement rates.

In the final order, the health plans deny that they violated applicable state laws but waive their rights to further hearings on the matter. The health plans agreed to corrective action plans to address these deficiencies and will provide the CID a full report within 180 days (on or about July 1, 2021).