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R.H. NDT Settlement Class and R.H. ABA Settlement Class Information

Background     

Individuals with neurodevelopmental disabilities and autism sued Premera Blue Cross and LifeWise of Washington in three different class action lawsuits:  A.G. et al., v. Premera Blue Cross et al.; J.P. v. Premera Blue Cross; and R.H. v. Premera Blue Cross.  The individuals sought coverage for neurodevelopmental (speech, occupational and physical) therapy and applied behavior analysis (ABA) therapy to treat their conditions.

R.H. v. Premera, United States District Court, Western District of Washington at Seattle Cause No. 2:13-00097-RAJ, was filed on January 16, 2013, on behalf of R.H., a child with autism spectrum disorder (ASD), and on behalf of similarly situated individuals.  R.H. alleged that Premera’s exclusion and limitation of coverage of neurodevelopmental and ABA therapies to treat DSM conditions violated the Washington State Mental Health Parity Act (“Parity Act”).  

Shortly thereafter, Premera moved to stay the case pending the outcome of Premera’s appeal in A.G. v. Premera, a related state court case.  On February 21, 2013, R.H. moved for class certification and partial summary judgment and permanent injunction to require Premera to cover neurodevelopmental therapies to treat DSM conditions under its mental health services benefit.  Premera moved to strike these motions.

On March 8, 2013, the Court denied Premera’s motion to strike but terminated R.H.’s class certification and summary judgment motions.  The Court directed R.H. to refile his summary judgment motion as a motion for preliminary injunction and indicated that the class certification motion would be re-noted at that time.  Shortly thereafter, Premera withdrew its motion to stay.  

On April 29, 2013, R.H. filed a motion for preliminary injunction.  On May 16, 2013, Premera filed a motion to dismiss.  After the motions (including R.H.’s motion for class certification) were fully briefed, the Court requested supplemental briefing on the effect of the final rules from the Washington State Office of the Insurance Commissioner on essential health benefits. 

While these motions were pending, the parties concluded that a global settlement of all three cases was possible.  R.H.’s counsel and Premera had met in the summer and fall of 2012, with a mediator’s assistance, in an attempt to settle the A.G. v. Premera case, but no agreement could be reached.  The parties’ counsel continued to discuss a possible resolution in the fall of 2013.  The parties jointly requested that the case be stayed pending settlement discussions.  They also moved to stay the J.P. v. Premera case.
  
The parties engaged in mediation on February 24, 2014, but a settlement agreement remained elusive.  The parties then engaged another mediator, and sessions were held on March 14 and May 1, 2014.  Late in the evening on May 1, 2014, the parties in each of the three cases reached a global settlement agreement, contingent upon final approval by all three Courts.  

Motions were made for preliminary approval, and the three Courts involved in the cases have granted preliminary approval of the agreement. 

The main points of the agreement are described below.  You are encouraged to review the entire proposed agreement, which is available here .  All three Courts must approve the agreement before it can go into effect..

• Coverage of Neurodevelopmental Therapy

Premera will cover medically necessary speech, occupational and physical therapies to treat developmental conditions listed in the DSM as Mental Health Services.  Premera will not impose age exclusions or treatment limits on coverage of the therapies.    Premera will not use or enforce exclusions for “services, therapy and supplies related to the treatment of … developmental delay or neurodevelopmental disabilities” or other similar exclusions to exclude or limit coverage of speech, occupational and physical therapies to treat these conditions. 

• Coverage of Applied Behavioral Analysis Therapy

Premera will cover medically necessary applied behavioral analysis (ABA) therapy to treat autism spectrum disorders as a Mental Health Service and consistent with “Terms of Coverage for Applied Behavior Analysis” in Appendix A to the settlement agreement.  Premera will not impose age exclusions or treatment limitations on coverage of ABA therapy.  Premera will not deny or limit coverage of ABA therapy based on an “academic” or “educational” exclusion.   Premera also agreed to develop credentialing criteria for ABA providers consistent with the credentialing criteria in Appendix A.  All requests for ABA Therapy must also meet other standard requirements, such as the requirement that care be medically necessary.

• $3,500,000.00 Settlement Fund

The agreement provides for a $3,500,000 settlement fund to pay for unpaid neurodevelopmental therapy services to treat DSM conditions received since January 1, 2006 for class members in large group plans, and since January 1, 2008 for class members in individual and small group plans, along with attorneys’ fees and costs, claims administration costs and incentive awards.  

• Claims Process for Unpaid Neurodevelopmental Therapy Services

A class member (through his or her parents and/or legal guardian) will be eligible for payment from the settlement fund upon submission of a claim form (which is provided, with instructions, as part of this class notice) that contains the following four items: 

1. the member’s DSM diagnosis, who made the diagnosis, and the date of diagnosis; 
2. the date(s) of neurodevelopmental therapy treatment (month/year); 
3. the provider(s) of the treatment; and 
4. the unreimbursed charges or debt incurred with that treatment. 

Agreement, § 8.4.2.1  To be entitled to reimbursement, a class member must have a diagnosis listed in the DSM-IV or DSM-V that required treatment with speech, occupational and/or physical therapies.   Agreement, § 8.4.2.1.  In addition, the charges must be documented with some evidence of payment(s) or obligation, such as (but not limited to) cancelled checks, credit card account statements, checking account statements, provider ledgers or signed letters from the provider or the provider’s employer documenting the amount paid or debt incurred (so long as the letter clearly connects payments/debt with neurodevelopmental service dates by at least the month/year).  Agreement, § 8.4.2.2.  A class member is entitled to reimbursement even if no claim was made to and/or denied by Premera at the time the service was rendered. 

A claims processor will review the claims to confirm that the four requisite items are on the claim form.  Agreement, § 8.4.3.  The claims processor will also confirm with Premera that the class member was insured under a health plan covered by the agreement at the time the services were received, and that the claimed sums are not duplicative of claims previously paid by Premera. Agreement, § 8.4.3.  The claims processor must provide a class member with a deficient claim form an opportunity to cure any problems, and class counsel is empowered to assist the class member in making any claim.  Agreement, §§ 8.4.3.1; 8.4.3.2.

• Attorneys’ Fees, Litigation Costs and the Costs of Claims Administration

Under the proposed agreement, class counsel may apply for attorneys’ fees under the common fund doctrine/common benefit doctrine in an amount totaling 35% of the settlement amount ($1,225,000), to be paid out of the settlement fund. Agreement, § 13.1. In addition, litigation costs (sums class counsel paid out-of-pocket on behalf of the class) and costs for claims administration will be requested to be paid from the settlement fund.  Agreement, §§ 13.2; 13.4. Class counsel will seek approximately $75,000 in litigation costs from the settlement fund. Class counsel’s requests for attorneys’ fees and litigation costs are subject to review, and must be approved by the Court.  Agreement, §§ 13.1; 13.2;13.4.

You are permitted to review, object to, support or comment on class counsel’s request for attorneys’ fees and costs.  On or before September 12, 2014, class counsel will post its fee and cost application on this page.  Alternatively, you may write or email class counsel and request that a copy of the application be sent to you.

• Incentive Awards 

Incentive awards of up to $25,000 for each class representative family (a total of $100,000 for the four class representative families) will be requested from the settlement amount.  Agreement, § 13.3.  The Courts must approve the incentive awards.  Agreement, § 13.3. 

You are permitted to review, object to, support or comment on the request for incentive awards.  On or before September 12, 2014, class counsel will post the application for incentive awards on this page.  Alternatively, you may write or email class counsel and request that a copy of the application be emailed or mailed to you.

• Insufficient Funds or Excess Funds 

Class counsel expects, but does not guarantee, that the $3,500,000 will be sufficient to pay all class member claims at 100%, even after payment of attorneys’ fees, costs, incentive awards and costs of administration. However, if insufficient funds remain to pay all class members who filed valid claims at 100% after the payment of attorneys’ fees, costs, incentive awards and expenses, then all class members will receive a pro rata (percentage) distribution of their approved claimed amount. Agreement, § 8.4.7. 
As claims are received and processed, class counsel will periodically post projections on this page with respect to whether sufficient funds will exist to pay all valid claims at 100%, or whether a reduction is likely (and the anticipated amount of such reduction).

If funds remain after the payment of claims, attorneys’ fees, costs, incentive awards and costs of administration, then those funds shall be distributed by the Courts to charitable organizations to assist families with a family member with developmental conditions to access health care and health coverage.  The parties will make recommendations to the Courts, who have ultimate authority to distribute any excess funds.

• Neurodevelopmental Therapy Claims Release 

Class members in A.G. v. Premera and R.H. v. Premera who require or have required neurodevelopmental therapy services will release defendants from any and all claims related to neurodevelopmental therapy that were or could have been brought in the lawsuit.  Agreement, §§ 1.5; 3.1.1. This means that if you have any claims arising out of defendants’ past failure to provide neurodevelopmental therapy, then those claims will be resolved as part of the agreement, and your right to payment for any damages related to neurodevelopmental therapy coverage will be governed exclusively by the agreement.  Agreement, §§ 3.1, 6.1; 8.

• Claims for Back Damages for Applied Behavioral Analysis Therapy Preserved

The agreement does not address, release or waive any claims for damages (money) that class members in the J.P. v. Premera or R.H. v. Premera cases may have for past applied behavioral analysis (ABA) therapy services. These types of claims may be addressed by class members outside of the settlement agreement and settlement fund.  Agreement, §§ 9.3; 9.4

If you are a member of the class, you have certain legal rights.  These rights include the following:

• Comment on, Object to, or Support the Proposed Settlement Agreement

You have the right to submit comments or objections to the Court.  You may support, object, or comment on any aspect of the proposed settlement agreement.  You may also support, object to, or comment on class counsel’s request for fees, costs and incentive awards.  You must submit your comments in writing, postmarked by November 21, 2015, to: Premera Settlement Claims Processor, Nickerson & Associates, LLC, 1700 7th Ave., Ste. 116 #330, Seattle, WA 98101.

• File an NDT Claim

You may submit a claim if you paid out of pocket, or have incurred an debt, for neurodevelopmental therapy to treat a mental health condition since January 1, 2006.  Claims must be postmarked by November 21, 2014.  A claim form can be found here  and the required certification page is here .  Both documents must be submitted.  Instructions in filling out and submitting the claim form can be found here .

• Do Nothing

You do not need to take any action to receive coverage for medically necessary neurodevelopmental therapies and/or applied behavior analysis therapy as described in the settlement agreement.  If you do nothing, however, any claims you have against Premera regarding neurodevelopmental therapy that could have been brought in these lawsuits will be released.  Class members’ claims for ABA therapy damages, however, will NOT be released.

• Opt-Out

If you are a member of the R.H. NDT Settlement Class, then you have the right to opt out of the class.  If you opt out, you will be prohibited from filing a claim and obtaining reimbursement.  You will keep the right to file a separate lawsuit.  You do not need to opt out if you do not have any neurodevelopmental therapy claims.  To opt out, you need to send in an opt-out form, which can be found here .  Your opt-out form must be postmarked by November 21, 2014.

The Court has set the following deadlines in this case:

1. Submit Comments and Objections: November 21, 2014
2. Opt Out (R.H. NDT Settlement Class only): November 21, 2014
3. File Claims for NDT Services: November 21, 2014.
4. Final Approval Hearing: January 9, 2015 at 10:00 am.  

The R.H. v. Premera Court will hold a hearing on January 9, 2015 at 10:00 a.m.  The hearing will be located in the courtroom of the Hon. Richard A. Jones at the United States District Court for the Western District of Washington, 700 Stewart Avenue, in Seattle.  You are not required to attend the hearing.

A copy of the complaint is here , and Premera’s answer to the complaint is here .

The Court’s Order certifying the R.H. NDT Settlement Class and the R.H. ABA Settlement Class is here .  This Order contains the full legal definition of each class.

The Court’s Order preliminarily approving the proposed settlement agreement is here .

The class’s motion for preliminary approval is here , with supporting documents filed in support of approval here  and here .

The motion for attorneys’ fees, costs and incentive awards is here, with supporting documents here.

The motion for final approval is here, with supporting documents here, here, here, here and here.

December 15, 2014 Update:  The claims process has now closed, and based on the number of claims received class members with approved claims will not be subject to any deduction, but will receive the full amount their approved claim.

Check back here for updates on the approval and claims process. Class counsel filed a motion for attorney fees, costs and incentive awards, which is posted in “Key Court Documents and Filings, above. Class counsel will also monitor the claims process and provide updates on the volume of claims, and anticipated percentage recovery of neurodevelopmental claims.

More Information

If the information on this page does not answer your questions, then you may contact class counsel for more information at ehamburger@sylaw.com or rspoonemore@sylaw.com.  You may also write to class counsel at Premera Class Action Information, Sirianni Youtz Spoonemore Hamburger, 999 Third Avenue, Suite 3650, Seattle, WA 98104.  You should not call the Court.