Kuderer fines Regence BlueShield $550,000 for MHPAEA violations

OLYMPIA, Wash. — Washington state Insurance Commissioner Patty Kuderer fined Regence BlueShield $550,000 on November 24 for violations of the Mental Health Parity and Addiction Equity Act (MHPAEA).

“The data Regence provided, or in some cases failed to provide, demonstrates a lack of accountability for following this nation’s insurance laws,” Kuderer said. “Throughout this process, Regence’s staff appeared to willfully misinterpret our questions, dismiss our concerns and generally disregard their own responsibilities to their members’ well-being.” 

Over the course of two market scans, a market conduct review, and several requests between 2019 and 2023, Regence failed to provide details of its processes, including what it considers when setting provider rates and determining network adequacy, and how these considerations impact its decision-making. 

The MHPAEA requires health carriers to provide documentation explaining the treatment limitations within the plan and how those limitations compare between behavioral health benefits and medical and surgical (M/S) benefits offered by the carrier’s health plans. This documentation must be provided to the Office of the Insurance Commissioner (OIC) upon request.

Regence failed to provide sufficient documentation for two treatment limitations — provider admissions standards and network adequacy — and could not provide detailed documentation showing its operations are comparable between offered behavioral health and M/S benefits. 

Data provided by the company shows large disparities in multiple areas, including:

• In-network reimbursement rates.
• M/S and behavioral health service provider negotiation rates.
• Out-of-network utilization.
• Provider participation rates. 

The company failed to provide detailed explanations or analysis of these disparities, which suggests a lack of parity in the company’s operations. Despite these disparities, Regence claimed parity was not an issue and failed to provide documentation to support those claims.

Learn more about mental health and substance use disorder coverage rights on the OIC’s behavioral health page.