Updates To Wit v. United Behavioral Health

• Published date: 31 March 2022
• Subject Matter: Litigation, Mediation & Arbitration, Food, Drugs, Healthcare, Life Sciences, Trials & Appeals & Compensation, Personal Injury
• Law Firm: Dickinson Wright PLLC
• Author: Ms Erica A. Erman, Gregory W. Moore, Christopher J. Ryan and Emma Trivax

The United States Court of Appeals for the Ninth Circuit recently released an unpublished memorandum decision in the landmark mental parity case of Wit v. United Behavioral Health. In this decision, the Ninth Circuit reversed the district court's order requiring UBH to reprocess more than 60,000 claims that had initially been denied for not meeting UBH's medical necessity guidelines. The memorandum decision was surprisingly short - and that has both positive and negative implications for mental health parity litigation.

What the Wit Plaintiffs did well (according to the Ninth Circuit):

The Ninth Circuit agreed that the Wit plaintiffs did have the standing to bring their action under Article III¹. Plaintiffs alleged a concrete injury that was sufficiently particularized, and they showed that UBH's actions resulted in uncertainty concerning the scope of their benefits and the material risk of harm to their contractual rights. The Ninth Circuit further explained, "[d]espite UBH's argument to the contrary, plaintiffs need not have demonstrated that they were, or will be, actually denied benefits to allege a concrete injury."

The eight generally accepted standards of care (GASC) in behavioral health that the district court identified in its March 5, 2019 findings of fact remain generally accepted standards of care. For more information about the underlying findings of fact from the district court, see our articles: Highlights from Wit v. United Behavioural Health and Court Rules UBH Coverage Guidelines a Monumental Fixer-Upper

Where did the error occur (according to the Ninth Circuit):

In the view of the Ninth Circuit, the District Court applied the correct standard when reviewing the actions of a Plan Administrator, but in doing so, the District Court misapplied the standard of review. The UBH Plans conferred upon UBH discretionary authority to interpret the terms of the Plan. Thus, the proper standard to be applied by the District Court was to "review the plan administrator's decisions for an abuse of discretion." The Ninth Circuit held that the district court misapplied this standard "by substituting its interpretation of the Plans for UBH's." The Ninth Circuit's memorandum opinion was totally devoid of any explanation of how the standard was misapplied. In addition, and even though the Plaintiffs argued quite extensively in their briefing that the abuse of discretion standard should be given a decreased level of deference in light of a clear conflict of...