WA insurance commissioner fines health insurer $550K

The Washington Office of the Insurance Commissioner has fined Premera Blue Cross Washington $550,000 over the company’s failure to comply with mental health coverage requirements.

Under state and federal requirements known as “mental health parity” laws, an insurer must cover mental health services in a way that is comparable to its coverage of physical health care. For example, if a plan offers coverage for unlimited visits to a doctor for a chronic physical condition, like diabetes or cancer, it must offer unlimited coverage for visits to treat chronic mental health conditions, like schizophrenia or depression, as well.

But according to an investigation from the state’s insurance commissioner’s office, Premera has failed to meet some of these requirements.

Mental health parity laws require insurance providers to document the limitations of their mental health coverage and how they compare to limitations in the plan’s medical or surgical benefits.

Premera was unable to provide documentation that showed that comparison, the insurance commissioner’s office said in a statement.

The company also didn’t provide its customers with information about basic access to mental health services, such as disability access information for in-person facilities, how to receive telemedicine services or whether a provider could be seen without a referral. Premera also did not update its provider directory on gender-affirming care monthly, as is required.

“These violations are a disservice to the people who rely on Premera’s health plans for their well-being,” said Patty Kuderer, the state insurance commissioner, in a news release. “Our laws are in place to ensure mental health services are just as accessible as medical services and we will keep holding the companies that don’t follow those laws accountable.”

The money from Premera’s fines will go toward the state’s general fund.

Courtney Wallace, a Premera spokesperson, said the company had made several of the changes, including updating the directory of gender-affirming care providers, and adding more guidance for telemedicine and how to access other services. Wallace said the remaining changes will be made by October.

“We welcome regulatory reviews as part of our commitment to transparency,” Wallace said in an email.

For the past few years, the insurance commissioner’s office has been conducting comparative analyses of the insurance providers that operate in Washington, thanks to federal grants the agency received to ensure companies are complying with mental health parity laws.

In conducting these studies, the agency found that Premera was in violation of several rules.

In 2023, the agency fined UnitedHealthcare $500,000 for similar violations, including failure to address disparities in people being denied coverage for treatment of mental health and substance use disorders compared to medical services.

Federal laws requiring mental health parity were passed in 2008. But they have not been consistently enforced, and studies have shown that insurers frequently disregard the rules. A report in 2024 found that patients were 10.6 times more likely to go out-of-network for psychological care compared to specialty medical care — a sign that mental health care patients needed wasn’t available in-network.

Congress passed legislation to require more reporting about which companies were following parity rules, which were finalized last year.

But the Trump administration has said it may rescind those more recently-passed enforcement rules. And while Washington has its own state mental health parity laws that will protect some health insurance customers, they don’t extend to everyone. Those who are on Medicaid, the federally-funded health insurance for low-income Americans, as well as those on “self-funded plans,” where employers provide health benefits directly to employees, are still at the mercy of federal enforcement.