SENS. LESSER & CABRERA: HOW MUCH DID CT FINE INSURANCE COMPANIES FOR SHORT-CHANGING MENTAL HEALTH TREATMENTS?

HARTFORD – Just days after the state Insurance Department issued a report saying it has fined five Connecticut insurance companies for short-changing customers seeking mental health treatments, state Senators Matt Lesser (D-Middletown) and Jorge Cabrera (D-Hamden) have written a letter asking the commissioner: How much did you fine them?

The Insurance Department never specified its penalties, which are capped at $625,000 if an insurance company fails to file its annual mental health compliance certifications.

Sens. Lesser and Cabrera are arguing not just for tough fines, but also for tougher follow-up enforcement actions to prevent future occurrences.

“Several carriers refused to provide adequate comparative analyses… even after multiple follow-up interrogatories from the Department. This conduct reflects non-cooperation that, in our view, warrants serious consideration in determining the appropriate scope of penalties,” Sens. Lesser and Cabrera wrote on April 17. “We respectfully urge the Department to ensure that this enforcement action goes beyond financial penalties alone.”

Sen. Lesser – who is Senate Chair of the Human Services Committee – and Sen. Cabrera – who is Senate Chair of the Insurance and Real Estate Committee – suggest the Insurance Department adopt the “Kennedy Forum’s Gold Standards for Corrective Enforcement Actions” which includes formal corrective action plans with clear timelines and measurable benchmarks and reimbursement to enrollees for out-of-network costs incurred as a result of the insurance company’s violations.

The Kennedy Forum document can be found here.

“States including Massachusetts, Pennsylvania, and California have successfully deployed these tools in parity enforcement actions, and Connecticut could do the same,” the senators said. “While financial penalties are an important means of holding insurers accountable, changed insurer behavior and equal access to care are the ultimate goals of parity enforcement.”

In the meantime, Sens. Lesser and Cabrera are asking the Insurance Department to answer four questions: 

1. What are the specific fine amounts assessed against each of the five carriers, and how were these amounts calculated?
2. What is the Department’s process and timeline for finalizing enforcement actions and making penalty determinations public?
3. Does the Department intend to require formal corrective action plans from the cited carriers, and if so, what elements will those plans be required to address?
4. What is the Department’s plan for ensuring that the violations identified in this report result in durable changes in carrier practices?

Last week’s Insurance Department report found that:

• Several insurance companies submitted reports that lacked details about case management, clinical auditing, and drug screening/testing;
• There were “material operational disparities” affecting policyholder access to mental health and substance use disorder networks across all five insurance companies;
• All five insurance companies maintained “non-comparative reimbursement rate methodologies” when compared to their medical and surgical reimbursement rates;
• All five carriers need to strengthen their evaluation of unequal outcome data and identify corrective actions.

In 2019, the General Assembly passed a bill requiring more mental health parity from insurance companies so that their networks and payments more closely mirrored those of medical/surgical patients. Last year, Democrats passed Senate Bill 10, which requires health carriers to annually file a mental health parity compliance certification with the state Insurance Department, which then makes public a carrier’s compliance – or lack of compliance with Connecticut’s mental health parity laws.

The 2025 bill allows the Insurance Department to fine insurance companies up to a maximum of $625,000 if they fail to file these annual mental health compliance certifications.

 
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