Michigan Centers Sue Blue Cross Over Payment Cuts and More

August 7, 2019

Source: Behavioral Healthcare Executive

Four Michigan addiction treatment facilities have filed a federal lawsuit against Blue Cross Blue Shield of Michigan (BCBSM) over what they term an unjustified slashing of payments and a high number of claims denials for substance use treatment since 2016. Partner Matt Lavin of the law firm representing the facilities tells Behavioral Healthcare Executive that the lead plaintiff in the case, Serenity Point Recovery, was forced to close its doors as a result of the low payments and coverage denials by the insurer.

Lavin says BCBSM in 2016 suddenly and without explanation cut the daily payment rate for residential substance abuse treatment, with the rate declining from just over $1,300 that April to just over $150 by July. “They also stopped processing thousands of claims submitted by our clients, again without explanation,” Lavin says.

He adds that the plaintiffs were not able to make progress in efforts to resolve the situation with the insurer. Lavin says that last February, BCBSM “informed our clients that they weren’t even willing to talk about it anymore or provide any guidance on how to fix the situation, necessitating this suit.”

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