In N.Y. State Psychiatric Association v. UnitedHealth Group, Docket No. 14-20-cv (2nd Cir. 2015), plaintiffs New York State Psychiatric Association, Inc. (“NYSPA”), Jonathan Denbo, and Dr. Shelly Menolascino sued UnitedHealth Group, UHC Insurance Company, United Healthcare Insurance Company of New York, and United Behavioral Health (collectively, “United”).
Relying on §§ 502(a)(1)(B) and 502(a)(3) of ERISA, the plaintiffs claimed that United had violated its fiduciary duties under ERISA, the terms of ERISA-governed health insurance plans administered by United, and the Mental Health Parity and Addiction Equity Act of 2008 (the “Parity Act”), which requires group health plans and health insurance issuers to ensure that the financial requirements (deductibles, copays, etc.) and treatment limitations applied to mental health benefits be no more restrictive than the predominant financial requirements and treatment limitations applied to substantially all medical and surgical benefits covered by the plan or insurance, see 29 U.S.C. § 1185a(a)(3)(A). NYSPA also brought three additional counts under New York State law.
United moved to dismiss the amended complaint, arguing that NYSPA did not have associational standing to sue on behalf of its members, that United could not be sued under § 502(a)(3) for alleged violations of the Parity Act or under § 502(a)(1)(B), and that in any event it would not be “appropriate” for the plaintiffs to obtain relief under § 502(a)(3) if § 502(a)(1)(B) offered an adequate remedy. The district court granted United’s motion to dismiss. Upon review, the Second Circuit Court of Appeals (the “Court”) concluded that NYSPA has standing at this stage of the litigation and that Denbo’s claims, but not Dr. Menolascino’s claims, should be permitted to proceed. As a result, the Court affirmed the district court’s decision in part, vacated the district court’s decision in part, and remanded the case back to the district court.