Mental Health Claim Delays and Denials
California’s mental health parity law requires health insurers to provide coverage for mental health treatment that is comparable to their coverage for physical health conditions. Yet in practice, insurance companies continue to subject claims for mental health treatment to an exceeding amount of scrutiny. Mental health care can be just as urgent and important as any physical condition, and state law recognizes and accepts this fact. Unreasonable delays or unfounded denials, therefore, may be a bad faith insurance practice that could subject the insurer to liability not just to provide coverage and pay claims, but also to compensate policyholders for harm caused by their actions, including punitive damages in appropriate settings.
Learn more below about some of the ways insurance companies like Anthem have been accused of undue delays and denials when it comes to mental health claims. To discuss a real-world situation that has happened to you or a member of your family, contact Gianelli & Morris in Los Angeles to speak with an experienced California insurance bad faith lawyer dedicated to holding insurance companies accountable by securing justice and compensation for consumers.
Case Study of Mental Health Claim Denials and Delays: Anthem Blue Cross
Anthem Blue Cross (including its California private plans and its Anthem Medi-Cal managed care plan) has repeatedly been flagged for obstructing mental health claims. Investigations and regulators have documented systemic problems, and Anthem has been repeatedly fined for “inappropriately denying claims and not covering out-of-network care that should have been covered,” according to KFF Health News.
In practice, providers report Anthem routinely rejects or stalls mental health claims over technicalities (even when patients had prior approval). For example, Anthem’s own provider bulletins stress that any missing data (billing NPI, Tax ID, taxonomy, etc.) will lead to a denial. Longer psychotherapy sessions are especially scrutinized – one billing guide notes Anthem subjects 53+ minute therapy codes (CPT 90837) to extra review, effectively forcing therapists to rebill as shorter sessions (CPT 90834) just to get paid. In short, Anthem’s system demands perfect, itemized claims or it will reject them.
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Strict coding and data requirements: Anthem warns providers that claims missing any required detail will be denied. In one example, Anthem/Blue Cross flagged the 90837 code for longer sessions as needing additional review. If a therapist codes even slightly differently, Anthem may audit or deny the claim. This means many legitimate therapy visits (e.g., a 60-minute session) are “marked excessive” and kicked back unless rebilled at a lower rate.
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Network-status denials: Anthem has often refused payment for “out-of-network” providers even when those providers were previously approved or had an exception. California regulators found Anthem repeatedly “not covering the cost of out-of-network care that should have been covered,” as reported by the national newsroom KFF Health News. In practice, that can mean a therapist treated a patient under authorization, but Anthem still denies the claim on network grounds, forcing patient appeals.
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Administrative bottlenecks: Even longstanding provider-patient relationships don’t protect against Anthem’s paperwork hurdles. Providers report that, years into treating a patient, Anthem suddenly demands resubmission of basic info (up-to-date NPI, Tax ID, licenses, etc.). Anthem’s official communications back this up: when Anthem switched systems, it told all providers to “review billing practices carefully” because missing the billing NPI or TIN on a claim “will be denied.” These retroactive requirements delay routine claims and force repeat submissions.
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Delayed appeals and notices: When patients or therapists do file appeals, Anthem’s processing is notoriously slow. In 2024, DMHC fined Anthem Blue Cross $3.5 million for failing to timely acknowledge or resolve member grievances and appeals. Over a two-year span, Anthem sent 11,000+ grievance notices late and failed to respond to over 4,000 appeals within the 30-day legal deadline. In May 2025, Anthem was again fined ($750K) for sending thousands of denial letters that contained incorrect appeal information. In sum, Anthem’s regulators note Anthem routinely misses the timelines meant to ensure patients get needed care.
Impact on Patients
The cumulative effect of these delays and denials on patients is devastating. Chronic mental illnesses like PTSD and major depression rely on consistent therapy, often scheduled weekly. For example, evidence-based treatment protocols for PTSD (even in complex cases) run 12–16 weeks of weekly therapy, according to a paper published in Psychiatry Online. Moreover, therapists emphasize that weekly sessions build a therapeutic alliance and allow steady progress. When insurance denials or delays interrupt these sessions, patients can quickly relapse. Indeed, experts warn that untreated PTSD often spirals into addiction or other health problems, while untreated depression “increases the chance of drug or alcohol addiction” and “ruins relationships, causes problems at work, and makes it difficult to overcome serious illnesses,” according to WebMD. In practical terms, a patient with PTSD or severe depression who loses weeks of care risks not only emotional destabilization but also harm to physical health and daily functioning. Missing even one week can break the routine that patients depend on to cope, undoing months of therapy gains.
Hundreds of Enforcement Actions Yield Millions in Fines, Yet Behavior Continues
These harmful outcomes have drawn regulatory action. California’s Department of Managed Health Care has repeatedly cited Anthem for these practices. The DMHC fined Anthem Blue Cross millions for late appeals and denial notices, and a Kaiser Health News review found Anthem amassed far more enforcement actions (over 500) than other plans for delayed grievances and improper denials. Yet despite fines and mandates, patients still report ongoing denials and delays. For vulnerable patients – especially Medi-Cal members who depend on Anthem’s plans – the bureaucratic gridlock means interrupted therapy and suffering that, by law, their plans should prevent.
Contact Gianelli & Morris Today
Investigations by California regulators and health news outlets document Anthem Blue Cross’s pattern of claim denials and slow appeals. Even Anthem’s own provider bulletins confirm the strict billing requirements. Meanwhile, experts and public health sources describe the clinical harm from interrupted PTSD and depression treatment. Unreasonable delays and denials not only go against laws and regulations; they cause real harm to real patients. Gianelli & Morris fights unfair and bad faith insurance practices like these. If your claim for mental health treatment or other health care has been unreasonably delayed or denied in California, contact our Los Angeles law office for a free consultation to find out how we can help.
