A Wrongful Death Case Focuses on California Mental Health Insurance

Many California families are still struggling to get mental health treatment four years after Gov. Gavin Newsom signed a landmark law requiring health insurance plans to provide enrollees with all medically necessary mental health and addiction treatment.

A new investigation by CalMatters mental health reporter Jocelyn Wiener found the system for appealing mental health denials effectively remains broken:

• Research shows most people don’t ever appeal treatment denials to their health plans; advocates say the fraction who do so often end up being denied yet again.

• Regulators don’t have data to track doctors’ decisions. They’re not authorized to routinely require health plans and health insurers to submit information about how often they deny treatment, nor do they have access to the records of the individual doctors making these denials.

• When state regulators do get involved, they overwhelmingly side with patients. For 2023 and the first eight months of 2024, for appeals related to residential treatment denials, the Department of Managed Health Care overturned health plans’ medical necessity decisions 76% of the time.

Jocelyn’s story details one family’s pursuit of treatment as their son sought to pull himself out of addiction. Ryan Matlock died at 23, soon after his insurance plan declined to continue covering his stay at an addiction treatment center, according to his family and a lawsuit they filed in San Bernardino Superior Court.

“He was just a number” to the health plan, said his mother, Christine Dougherty of Yucaipa.

She’s suing OptumHealth Behavioral Solutions of California, which declined to comment on Matlock’s case and in a statement said the health plan’s “coverage determinations are made in accordance with the terms of the member’s health plan and federal and state laws, as well as using evidence-based clinical guidelines and peer-to-peer reviews.”

State lawmakers have been watching the 2020 law. This past session, Sen. Scott Wiener introduced Senate Bill 294, which would have required an automatic review when commercial health plans denied children and young people mental health treatment. The Senate passed the bill in January, but it was held by the Assembly appropriations committee in August.

“The fact that we even have to consider that bill is an indictment of the system,” the San Francisco Democrat said.

Treatment decisions can be difficult, and no one is arguing that insurance plans should not recommend that patients go to lower and less expensive levels of care.

“That’s the hardest part, to say to someone ‘Do you want to risk it? How much are you thinking you might kill yourself?’” said Dr. Alexis Seegan, inpatient medical director at the UC Irvine Medical Center and immediate past chairperson of the government affairs committee of the California State Association of Psychiatrists.

Read more on the issue in Jocelyn’s story. And find out what you can do if you’re denied coverage in this handy guide.

CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.