This Can’t be Right: UBH/Optum Discontinuing Out of Network Benefits

UBH/Optum discontinuing Out of Network Benefits …and it doesn’t stop at behavioral health services…medical services might be equally affected. 

In July 2021, UBH/Optum notified some providers about changes to its plans that apparently included, among other changes, the decision to exclude members’ out-of-network benefits for services located outside of the member’s plan’s service area. Notably, a “Fully Insured” plan, according to Optum, is a plan wherein the insurer pays for the services and the member is not covered by a self-funded employer plan. The change would apply to medical and behavioral health services. At the time, services were already subject to prior authorization, and the change added one more barrier to a growing number of barriers to care.

The Notice specifically calls out behavioral health exclusions for non-emergent, sub-acute  inpatient or outpatient services received at any of the following facilities:  

• Alternate Care Facility – PHP or IOP  

• Freestanding Facility – Psychiatric or Substance Use  

• Residential Treatment Facility – Psychiatric or Substance Use  

• Inpatient Rehabilitation Facility – Psychiatric or Substance Use  

While the Notice appears to have been directed to in-network (“INN”) providers, the changes we shared above  would not affect services provided by INN providers who evidently can continue to admit and treat members of  Fully Insured plans regardless of geography. Indeed, the Notice specifically advises INN  providers that they may be asked to accept Optum members who are currently at out-of-network (“OON”) facilities that will no longer be covered at those facilities once this change in coverage goes into effect. 

Despite Optum’s couching this change in policy as a “quality and cost-share” issue, it seems  more likely to be strictly a cost-cutting measure, particularly given that the change applies only  to Fully Insured plans where Optum is “on the hook” for the cost of care, but not to self-funded  employer-plans where Optum’s role is only to serve as an administrator of claims that ultimately are  paid by the self-funded plans themselves. 

In practice, the effect is another barrier to much-needed care. 

As for providers, especially in the behavioral health space, they typically are either unable to  secure contracts with payors like Optum despite efforts to do so, or they opt to stay out-of-network because they do not want to accept the lower reimbursement rates demanded by the  major payors when contracting to be an INN provider. 

In our view, Optum’s new policy raises a possible parity concern under Mental Health Parity laws. While on its face the Notice appears to apply to both medical and behavioral care, in practice there could be a disproportionate impact on behavioral health providers, especially residential treatment centers (“RTCs”).