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Horizon Blue Cross Settles Eating Disorders Suit

Class action claimed company wrongfully denied payment for treatments

January 10, 2009
Horizon Blue Cross/Blue Shield of New Jersey has tentatively settled a class action pending in federal court in Newark, New Jersey involving reimbursements for medical expenses relating to the treatment of eating disorders. The terms of the settlement must still be approved by the court.

Although Horizon covered treatments related to eating disorders (primarily anorexia and bulimia), including hospitalization, outpatient treatment, psychotherapy and nutritional counseling, there were benefit limits on such treatments.

Under the settlement terms, Horizon has agreed to pay claims for eating disorders that were denied because they exceeded the plans’ maximum benefit for non-biologically based mental illness.

Horizon has also agreed to give parity treatment to eating disorder claims for Horizon insureds in the future and to enhance its appeals procedure by providing the right to select review by an eating disorder specialist of all claims denied on the basis of medical necessity.

The attorney who represented the class action plaintiffs, Bruce H. Nagel, called it "a landmark settlement which should change the way insurance carriers view eating disorders" and said he urged other insurers to "get in line with this settlement."

A Horizon spokesman said the insurer was "pleased" with the settlement.

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