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Ultra Health in New Mexico Sues Insurers to Reimburse Medical Marijuana Patients

New Mexico’s largest marijuana company, Ultra Health, has teamed up with a group of patients to file a class-action lawsuit against seven health insurance companies in the state, demanding that cannabis be recognized as a behavioral and mental health treatment, and that about 74,000 qualifying patients be reimbursed for using medical marijuana.

The legal action, the plaintiffs argue, is based on state legislation – SB317 – ’No Behavioral Health Cost Sharing’ – that came into effect in January this year and requires all insurers to reimburse patients 100% for the cost of any care related to mental or behavioral health, MJBizDaily reports. Specifically, according to Western Sky Community Care, SB317 prohibits cost-sharing, including the imposition of a deductible, for behavioral health (BH) services covered by any health care plan that’s “delivered, issued for delivery or renewed in New Mexico.”

Before seeking legal intervention, Ultra Health sent out letters to New Mexico’s leading health insurers and state agencies seeking confirmation for cannabis coverage as a behavioral health service. Citing no responses from the recipients, along with the escalating financial woes of qualified patients who are forced to pay out-of-pocket for cannabis, and “in violation of state law,” Ultra Health says they have no other choice but to seek relief from the courts.

‘A Small Step, Not A Giant Leap’

Ultra Health and the patient coalition – Tomas Lorenzo Valencia, Bryce Bryant-Flynn, Matias Trujillo, Erica Rowland, Ariel McDougal, and Democratic state Sen. Jacob Candelaria – want the courts to recognize medical cannabis as a “healthcare service for treating behavioral/mental health conditions.”

They are also seeking compensation for expenses incurred since January 1, when the behavioral health law took effect. “A health insurance policy that offers coverage for behavioral or mental health services must pay 100 percent of the cost of such service,” the class-action suit states. It further alleges that the insurance companies in question chose not to cover costs for eligible patients “intentionally and in a reckless and willful disregard of the rights of Plaintiffs for which they are entitled to punitive damages.” Ultra Health CEO Duke Rodriguez said, “insurers have not acted in good faith.”

Rodriguez further noted that New Mexico already requires workers’ compensation insurers to pay for medical cannabis, and New Mexico already treats medical cannabis the same as conventional prescription medications.

“The fact that health insurers should – and will – pay for medical cannabis is not revolutionary at this point. It is the next logical step, and it is a small step, not a giant leap.”

Canada, Colombia, Germany, Israel… Ultra Health also pointed out instances where medical cannabis is covered (to varying degrees) through traditional health insurance services.

 

Ultra Health

 

First-Of-Its-Kind Action Could Set National Precedent

In their letter to New Mexico insurers and state departments, Ultra Health acknowledged that paying for medical cannabis may require “specific decisions” regarding funding. “Cannabis is obviously still illegal at the federal level, so programs that receive federal funding may need to segregate the funds used for medical cannabis and use only non-federal sources of money.”

Speaking to Marijuana Moment, Ultra Health CMO Marissa Novel added that the “issue of federal prohibition shouldn’t preclude insurers from covering cannabis, especially for government-funded plans such as Medicaid. It’s really just a matter of using state funds over federal funds.”

Novel says despite the no-responses to its letters, her company is expecting this lawsuit to trigger reactions from insurers’ legal and underwriting departments. Pointedly, she says, not only because of the implications in New Mexico but also the national impact.

“This could have the same reverberation as New Mexico’s experience with cannabis coverage and workers’ compensation.” Then-Gov. Bill Richardson signed off on the Lynn and Erin Compassionate Use Act, in 2007, making medical cannabis legal in New Mexico.

 

Reimburse Marijuana Patients

 

 


 

About 55% of the state’s registered medical marijuana (MMJ) patients use cannabis to treat PTSD or other behavioral/mental health issues (about 74,000 patients) according to Rodriguez’s estimates.

Among them is state Sen. Candelaria who is insured by Blue Cross and Blue Shield of New Mexico. Candelaria, according to the lawsuit, has been an MMJ patient since 2019 after his physician recommended he use cannabis to help treat his PTSD after limited success using antidepressants. He reportedly spends between $500 and $1,000 a month on medical cannabis, paying entirely out of pocket since becoming an MMJ patient.

Speaking to the Albuquerque Journal, Candelaria said medical cannabis has had a positive effect on his life, adding that he signed onto the lawsuit not only for personal benefit but for the many “New Mexicans who are struggling to pay for their health care.”

Rodriguez says the damages and declaratory lawsuit they have filed will prise open doors for more medical patients to join in and that more will be identified who have been “harmed by insurers not lawfully abiding by the statutory duty of eliminating any cost-sharing related to behavioral health services.”

Under the SB317 – No Behavioral Health Cost Sharing legislation, the definition of behavioral health services was expanded to include “professional and ancillary services for the treatment, habilitation, prevention, and identification of mental illnesses, substance abuse disorders, and trauma spectrum disorders, including inpatient, detoxification, residential treatment, and partial hospitalization, intensive outpatient therapy, outpatient, and all medications, including brand-name pharmacy drugs when generics are unavailable.” Ultra Health pointed out that the operative phrase in this piece of text is ‘all medications.’

Moreover, and to “ensure that all New Mexicans receive equal treatment with respect to health plan coverage for BH services,” SB317 further states that “The application of the prohibition on cost-sharing for BH services must be standardized across all subject health plans on January 1, 2022.”

“Senate Bill317 was transformational,” Candelaria told the AJ. “This suit, you know, it becomes necessary to actually make that transformation happen,” and according to  Rodriguez, all the foundational elements have already fallen into place.

“Enjoyed that first hit? Come chill with us every week at the Friday Sesh for a freshly packed bowl of the week’s best cannabis news!”

 

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