Cannabis class action suit over insurance moves to federal court

A class action lawsuit challenging health insurance companies’ refusal to cover the costs of medical cannabis has been moved to federal court, for now. 

The lawsuit, filed earlier this year by a group of medical cannabis patients and one cannabis production company, originally asked a state district court judge to order New Mexico healthcare insurance companies to cover the costs of medical cannabis for members. The seven insurance providers in turn refiled the case in federal court, arguing that it is the appropriate venue because the plaintiffs’ claims are inherently tied to federal law. 

In June, six New Mexico medical cannabis patients and cannabis producer Ultra Health filed the class action suit, arguing that the recent enaction of a state law requiring insurance providers to cover the costs of behavioral health services should also include medical cannabis. In turn, last week, lawyers for the insurance companies moved the case to federal court, arguing that the federal Employee Retirement Income Security Act, which sets standards for many health insurance plans, “preempts” the plaintiffs’ claims. Lawyers for the insurance providers also justified moving the case to federal court because the lawsuit “necessarily raises disputed and substantial issues of federal law,” specifically whether the federal Controlled Substances Act allows a state to mandate coverage of a substance that is still federally illegal. The final claim justifying the move to federal court argues that the type of class action lawsuit the defendants filed should be in federal court. 

The lawsuit came just months after the enactment of a state law that prohibits cost-sharing for behavioral health services. After signing the enacting legislation, Gov. Michelle Lujan Grisham praised the bill in a press release. 

“We can make a real, meaningful difference by reducing the costs for those with insurance who seek help by eliminating the copays for behavioral health services – and I’m so proud and grateful to sign this priority measure,” Lujan Grisham said. 

The state agency tasked with regulating insurance has maintained that the department, which is one of the governor’s cabinets, does not have the authority to force insurance providers to cover cannabis. 

One of the plaintiffs is Albuquerque-based attorney and New Mexico state Sen. Jacob Candelaria.

We asked prosecutors if health insurance companies care about fraud. They laughed at us.

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox. Like most of us, William Murphy dreads calling health insurance companies. They route him onto a rollercoaster of irrelevant voice menus, and when he finally reaches a human, it’s a customer service rep who has no idea what he’s talking about. Then it can take days to hear back, if anyone responds at all.

Obamacare premiums dip for first time. Some call it a correction.

After two years of double-digit price hikes, the average premium for individual health coverage on the federal health law’s insurance marketplace will drop by 1.5 percent for 2019, the Trump administration said Thursday. The announcement  marked the first time average premiums have fallen since the exchanges created by the Affordable Care Act went into effect in 2014. It also comes during a bitter midterm congressional campaign season in which health care is a central issue following last year’s efforts by Republicans to repeal the ACA. Administration officials claimed credit for the price drop, saying it was due to their actions to make changes to the law. Health policy experts said it was a reaction to insurers’ huge profits following hefty premium increases on plans offered this year.

NM insurance premiums jumped after Trump actions

New Mexicans who buy health insurance through the Affordable Care Act’s exchange will pay higher premiums this year, and recent actions by the Trump administration are a big reason why. Customers who earn $47,000 or more and are not covered by employers will see the largest bump. This all comes as open enrollment began on Nov. 1 and will run through Dec. 15.

State insurance superintendent warns against ‘swift changes’ to Affordable Care Act

The State Superintendent of Insurance told the U.S. House Majority Leader that the Affordable Care Act is flawed, but still warned against drastic changes that would hurt New Mexicans. This came in a letter from Superintendent John Franchini sent to House Majority Leader Kevin McCarthy, R-Calif., last week. “While we agree that there are significant opportunities for improving the ACA, we caution the new administration in making any swift changes that will destabilize the market or upend the gains made to coverage for New Mexico residents,” Franchini wrote. “Importantly, tax credits and cost-sharing reductions serve a vital function in diversifying the risk pool of individuals who purchase insurance.”

The call against “swift changes” comes during a debate between Republican members of Congress and President-elect Donald Trump’s team over how quickly to repeal the ACA and whether to do so in tandem with a replacement plan. #mc_embed_signup{background:#fff; clear:left; font:14px Helvetica,Arial,sans-serif; width:100%;}
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Udall, Heinrich vote against first steps to repeal Obamacare

Both U.S. senators from New Mexico voted this week against the first steps the Senate took to repeal the federal Affordable Care Act, known as Obamacare. The Senate vote, held Thursday during early morning hours, changed procedural rules to allow majority votes on so-called reconciliation bills. Such reconciliation bills are limited to actions on the federal budget and are filibuster-proof, meaning they just need 51 votes from senators to pass instead of the usual 60 votes. Republicans plan to use this reconciliation process to repeal as much of the ACA as they can. Sens.

Three agencies question OSI’s plan to collect $193 million owed to state

Three state agencies expressed a lack of confidence Thursday in the Office of the Superintendent of Insurance’s (OSI) ability to collect millions of dollars back taxes owed to the state from health insurance companies. State Auditor Tim Keller, Department of Finance and Administration State Budget Division Director A.J. Forte and Legislative Finance Committee Deputy Director Charles Sallee all expressed doubts in OSI’s plans to collect an estimated $193 million that it failed to collect from premium health insurance taxes from 2010 through 2015. The comments came at an interim Legislative Finance Committee hearing. “I think it’s very notable there are three oversight agencies looking at this,” Forte told state lawmakers. “There are too many inconsistencies for me to feel comfortable in this process.”

The controversy began when Keller’s office revealed the uncollected revenue in a special audit earlier this year.

Audit: NM didn’t collect $193 million in taxes from insurance companies

The state failed to collect nearly $200 million in taxes from health insurance companies during a recent five-year period, according to a report released Tuesday by State Auditor Tim Keller. The state Office of the Superintendent of Insurance (OSI) should have collected more than $193 million between April 2010 and April 2015, according to the report. OSI’s purpose is to collect premium taxes from insurers who do business in New Mexico. In the report, Keller noted that the $193 million total is based on a sample representing 26 percent of all premium taxes collected during the time period. In other words, OSI may have failed to collect more than that estimate.

Medicaid a bright spot in a dismal economy

Abuko D. Estrada is a health care attorney with the New Mexico Center on Law and Poverty. Since 2008, it has been gloomy in New Mexico. Our state is still recovering from the Great Recession. Our job growth has been among the worst in the nation, leaving us well short of pre-recession job levels. We are the only state in the nation where more people are moving out than moving in.

Children’s uninsured rate at new low

ALBUQUERQUE, N.M. – More children in New Mexico and around the nation now have health coverage. According to a new report by the Georgetown University Center for Children and Families, the rate of uninsured children dropped to a historic low of six percent nationally in 2014, the year the Affordable Care Act (ACA) went into effect. Abuko Estrada, staff attorney with the New Mexico Center on Law and Poverty, cites the state’s decision to expand Medicaid under the ACA as a significant factor for the increased coverage of children in the state. He says the move helped create what he calls a “welcome mat effect” when adults went looking for insurance. “Because their parents were going to see what options they had to get coverage under the Affordable Care Act, we were able to capture some of those kids that were missing,” he says.