ABA COMPETITION BENCH BRIEF

Facts Medicaid is a joint venture between the federal and state governments in which the federal government directs financial assistance to state programs that provide medical care to eligible individuals. State participation in the Medicaid program is entirely voluntary, but when a state elects to participate, the states Medicaid scheme must comply with the requirements in the federal Medicaid Act and its related regulations. Texifornia voluntary participates in Medicaid. Under the Medicaid Act, a states Medicaid scheme must provide Early Periodic Screening, Diagnosis, and Treatment (EPSDT) services to categorically and medically needy individuals under twenty-one years of age. Once a Medicaideligible individual is determined to be categorically needy, he is automatically entitled to EPSDT services. At all times a state must provide all medically necessary EPSDT services to eligible children until the age of twenty-one. In September 1996, Congress passed the first federal Mental Health Parity Act. The Mental Health Parity Act prohibits largegroup health plans from imposing lower annual or lifetime dollar limits on mental health benefits than for medical and surgical benefits. Congress then passed the Wellstone Act in 2008 to create parity between the provision of mental health and medical benefits by restricting the types of treatment limitations group health plans may impose. Under the Wellstone Act, a large-group health plan that provides both medical and mental health benefits may not create

treatment limitations applicable to such mental health benefits that are more restrictive than the predominant treatment limitations applied to substantially all medical or surgical benefits covered by the plan. Furthermore, a large-group health plan may not impose separate treatment limitations applicable only to treatment of mental health benefits. Ryan Reed is a twelve-year-old boy from Texifornia. A developmental cognitive neurologist diagnosed Reed with autistic disorder at twenty-two months old. Autism represents a broad spectrum of related neurodevelopmental disorders that typically manifest by age three. Autism spectrum disorders vary greatly in type and severity but almost invariably involve some effect on communication skills and social interaction. Impairments range from mild to severe. All autism spectrum disorders are considered lifelong disabilities. Reed has been diagnosed with autistic disorder, the most impairing diagnosis within the autism spectrum. Reed suffers from a range of social and cognitive impairments. The most widely prescribed treatment of autism is Applied Behavior Analysis (ABA therapy). The National Institute of Mental Health and the American Academy of Pediatrics recognize ABA therapy as a valid treatment for autism. Individuals undergoing ABA therapy are able to make significant improvements and reduce inappropriate behaviors. Reeds doctors and the neurologist who provided his original diagnosis specifically recommended ABA therapy for Reed. Starting at age six, Reed received three years of ABA

therapy through Texifornias Medicaid waiver program. Reed showed immense improvement in his ability to communicate and respond to others. Reed is eligible to receive medical coverage through Texifornias Medicaid program and his mothers largegroup health insurance plan with Pluribus Health. After his coverage expired under the state waiver program, Reed submitted claims to both the Texifornia Department of Health and Human Services (HHS) and Pluribus Health for coverage of his ABA therapy. HHS denied coverage, indicating that the agency generally views treatment for autism as habilitative rather than rehabilitative. The denial letter states that habilitation services are not included in the Medicaid programs definition of medical assistance, but the letter failed to define habilitation services. Pluribus Health also denied coverage for Reeds ABA therapy because Reed was over the age of eleven, the age at which Pluribus Health stops providing coverage for ABA therapy. Procedural History Reed filed suit in the United States District Court for the District of Texifornia seeking declaratory and injunctive relief, alleging he has the right to receive coverage for ABA therapy under Medicaid and his private insurance. He filed suit against Texifornia HHS and Pluribus Health. The district court found that Reed failed to establish entitlement to a preliminary injunction against the Texifornia HHS and is not entitled to Medicaid coverage because (1) ABA is not rehabilitative because it does not restore a person to the best possible functional level, (2) ABA does not prevent autism, and (3) the services provided at the Autism Academy of Texifornia (AAT) are

not administered by a state-licensed physician or practitioner. The district court then found that Reed satisfied the preliminary injunction standard with respect to his claim against Pluribus Health. The court held that autism is a mental health condition because autism is listed in the Diagnostic and Statistical Manual of Mental Disorders DSM-IV-TR. The court also held that random numerical limitations in an insurance policy are impermissible, and then decided the age restriction is a random numerical limitation. The United States Court of Appeals for the Thirteenth Circuit affirmed the decision regarding the preliminary injunction for Texifornia HHS and reversed the district courts grant of a preliminary injunction against Pluribus Health. The court of appeals pointed out that ABA is separate from other Medicaid services because it is provided to Texifornia children through a waiver program. The court of appeals reversed on the insurance claim because it found that autism is not considered a mental health disorder according to national organizations and the autism community. The court of appeals also held that even if autism is a mental health disorder, an age limitation on treatment is permissible. This Court then granted Reeds petition for writ of certiorari to consider (1) Whether the Early Periodic Screening, Diagnostic, and Treatment provision of the federal Medicaid Act requires the Texifornia Medicaid program to provide coverage for Applied Behavior Analysis for children with autism. (2) Whether a large-group health insurance policy subject to

Texifornia state law may limit coverage of Applied Behavior Analysis to children under age eleven. Petitioner I. TEXIFORNIAS REFUSAL TO PROVIDE COVERAGE OF ABA THERAPY UNDER THE EPSDT MANDATE VIOLATES THE FEDERAL MEDICAID ACT. ABA Therapy Meets All Threshold Requirements To Be Provided As An EPSDT Service.
A.

consequences of Reeds autism

Respondent I. THE FEDERAL EPSDT PROVISIONS DO NOT REQUIRE COVERAGE FOR REEDS ABA THERAPY UNDER THE TEXIFORNIA MEDICAID PROGRAM.

ABA therapy is not an EPSDT service, which are only those listed in 42 U.S.C. 1396d(a).4

1. ABA therapy is medically necessary to treat autism within the scope of the EPSDT provision. A service must be medically necessary before a state is required to provide it as an EPSDT service.1 When a physician familiar with the childs autism recommends a particular treatment as medically necessary, the service must be provided for a Medicaid-eligible child.2 Reeds primary physician specifically deemed ABA therapy medically necessary due to the severity of [Reeds] deficits. 2. ABA Therapy Ameliorates Reeds Autism As Required For EPSDT. Where treatments cannot completely eradicate a condition or its symptoms, a treatment may still ameliorate a condition to such a degree as to be required under Medicaid.3 ABA therapy actually eliminated severable of the undesirable
See e.g., Moore v. Medows, 324 F.Appx. 773, 774 (11th Cir. 2009); see also Rush v. Parham, 625 F.2d 1150, 1155-56 (5th Cir. 1980) 2 See McHenry v. PacificSource Health Plans, 679 F. Supp. 2d 1226 (D. Or. 2010) 3 Ekloff v. Rodgers, 443 F. Supp. 2d 1173, 1180 (D. Ariz. 2006)
1

A. ABA Therapy Is Not a Rehabilitative or Preventive Service as Required by 1396d(a)(13). Under 1396d(a)(13) a service must be diagnostic, screening, preventive, or rehabilitative. 1. Texifornias EPSDT provision does not provide assistance for habilitative services such as ABA therapy. Under the plain language of 1396d(a)(13), a covered service must be rehabilitative and not habilitative. Habilitative services are not listed in the definition of medical assistance and cannot be covered under the rehabilitative category.5 Habilitative services provide skills needed for daily living. They also focus on the social and adaptive skills that enable an individual to avoid institutionalization.6 ABA is habilitative because it focuses on teaching a child
See 42 U.S.C. 1396d(r) (2006); S.D. v. Hood, 391 F.3d 581, 590 (5th Cir. 2004); Moore v. Reese, 637 F.3d at 1233-34. 5 See PLEAS, 565 F. Supp. 2d at 909 6 Doe v. Kidd, 419 F. Appx 411, 417 (4th Cir. 2011)
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social and adaptive skills. It does not rehabilitate any skills a child previously had.

are severely limited as a result of his poor oral motor deficits and aggressive behavior, both are direct effects of autism

Petitioner B. ABA Therapy Constitutes A Rehabilitative Service As Described In 1396d(a). To qualify as a rehabilitative service, the service must be recommended by a physician. This recommendation must be made to provide for the maximum reduction of a physical or mental disability and restoration of an individual to the best possible functional level.7 1. Both Reeds physician and the diagnosing neurologist made the recommendation for Reed to undergo ABA therapy. 2. ABA Therapy provides Reed with maximum reduction of his disability. a. Reeds autism qualifies as a disability, entitling Reed to rehabilitative services. A disability is a medically determinable physical or mental impairment that causes marked and severe functional limitations, and that has lasted or can be expected to last for a continuous period of not less than 12 months.8 Reeds abilities to learn, communicate, and function socially
7
8

Respondent Rehabilitative services include any service recommended by a physician for maximum reduction of physical or mental disability and restoration of a recipient to his best possible functional level.9 Reed is not being restored to a previous functional level as required under (a)(13) in accordance with the definition of rehabilitative. Texifornia HHS views autism therapies as habilitative, and an agency is afforded considerable deference when it interprets and administers a statute.10

2. ABA therapy does not prevent autism and is not administered by a state-licensed practitioner as required under 1396d(a)(13).

42 U.S.C. 1396d(a)(13) (2006) 20 C.F.R. 416.906 (2011)

42 C.F.R. 440.130(d) Chem. Mfrs. Ass'n v. Natural Res. Def. Council, Inc., 470 U.S. 116, 125 (1985); Chevron U.S.A. Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 844 (1984)
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Preventive services must be provided by a physician.11 Reeds therapy is not administered by a licensed practitioner of the State of Texifornia, but by behavior analysts not licensed by state law

3. Only medical or remedial services that are preventive or rehabilitative are covered under 1396d(a)(13). Congress intended that all medical or remedial services under (a)(13) must be one of the four services listed, which are diagnostic, screening, preventive, and rehabilitative.12 Petitioner b. ABA therapy will provide the best opportunity for maximum reduction of Reeds symptoms. Courts defer to expert medical testimony to determine which available treatment will offer the maximum reduction in a patients disability.13 According to Reeds expert, the best treatment plan will include ABA because it has proven to be a highly effective form of behavioral treatment in virtually all cases. 3. ABA therapy restores Reed to his best functional level. A medically necessary service meets the restoration

requirement if the treatment helps a child improve his or her functional level. 14 Reeds participation in ABA therapy has improved his diet and Reed is able to communicate by using extremely quiet and tentative three-word sentences, as well as exhibiting an ability to better control his aggression. C. ABA Therapy Qualifies As Medical or Remedial Under 1396d(a) To meet the requirements of medical or remedial care, the medical assistance must be (1) recognized under state law, and (2) furnished by licensed practitioners within the scope of their practice as defined by state law. 15 Respondent B. Reeds ABA Therapy Is Not Furnished by a StateLicensed Practitioner. Section (a)(6) requires that medical care furnished by licensed practitioners within the scope of their practice as defined by State law.16 Providers at AAT are not licensed under Texifornia law. C. ABA Therapy is provided by a waiver and therefore coverage is not mandatory under EPSDT provisions. All EPSDT services in 1396d(a) are mandatory when

11

42 C.F.R. 440.130(c) 12 Ariz. State Bd. for Charter Sch. v. U.S. Dept of Educ., 464 F.3d 1003, 100708 (9th Cir. 2006) (citing Fed. Land Bank of St. Paul v. Bismarck Lumber Co., 314 U.S. 95, 100-01 (1941)) See e.g., Pediatric Specialty Care v. Ark. Human Services, 293 F.3d 472, 477 (8th Cir. 2002)
13

14

Rosie D., 410 F. Supp. 2d at 27; see also Parents League for Effective Autism Services v. Jones-Kelley (PLEAS), 565 F. Supp. 2d 905 (S.D. Ohio 2008); see also McHenry, 679 F. Supp. 2d at 1241. 15 42 U.S.C. 1396d(a)(6) (2006) 16 42 U.S.C. 1396d(a)(6)

medically necessary for children under twenty-one and these services cannot be waived. When a state has a federally-approved waiver to provide some other service, that other service is not a covered EPSDT provision. Reed received ABA Therapy through Texifornias federallyapproved waiver to provide Applied Behavior Analysis for children under age ten. Because ABA is made available to Reed through a federallyapproved waiver, it cannot be an EPSDT service and Reed is not entitled to coverage for ABA under the EPSDT statute. D. Medicaid does not require a state to provide all medically necessary services for every individual. A state is required to provide only the medically necessary services listed in the EPSDT provisions.17 A service must be both covered and necessary for Medicaid payment to be proper.18 Petitioner The proper providers of such care are medical professionals with the appropriate training and skill set.19 ABA Therapy is recognized under state law, as Medicaid provides it through its waiver program. Therapists providing ABA services receive certification from the nationally accredited certification agency, the Behavior Analyst Certification Board.20
See 1396d(r)(5); Moore, 637 F.3d at 1233 DeSario v. Thomas, 139 F.3d 80, 92 (2d Cir. 1998) 19 See Chisholm, 133 F. Supp. 2d at 898 20 McHenry, 679 F. Supp. 2d at 1232
17

Professionals subject to board certification and regulation receive the same scrutiny, if not more, than those required to obtain a license to perform their professional duties.

D. Texifornia Cannot Cut Off Coverage of ABA Therapy Until Reed Turns Twenty-One The Medicaid Act mandates coverage for all necessary treatment for those under age twenty-one whether or not such services are covered under the State plan.21 Because ABA therapy is a medically necessary service, Texifornia may not avoid providing this important service to Reed until he reaches twenty-one years of age. II. THE PLURIBUS HEALTH POLICY VIOLATES THE WELLSTONE ACT BECAUSE IT IMPOSES AN IMPERMISSIBLE AGE LIMITATIONS ON A MENTAL HEALTH BENEFIT. The plans age limitation for ABA therapy is impermissible because it is more restrictive than any treatment limitation on comparable medical and surgical benefits and because it only applies to ABA therapy, a mental health benefit. Respondent 1. The Texifornia waiver limitations on age and duration of services are appropriate based on medical necessity. A state Medicaid agency may place appropriate limits on a service based on medical necessity, which the state determines.22 Texifornia has the legal right to make that determination
21 22

18

42 U.S.C. 1396d(r)(5) 42 C.F.R. 440.230(d) (2011)

regardless of an individual physicians determination. 23 The Texifornia PDD waiver determines that ABA is necessary and can be provided for three years up to age ten. 2. Texifornias PDD waiver is consistent with the objectives of the Medicaid Act because it is sufficient in amount, duration, and scope. Each service provided by a state plan must be sufficient in amount, duration, and scope to be consistent with the objectives of the Medicaid Act.24 States have substantial discretion to choose the proper mix of amount, scope, and duration limitations on coverage.25 Coverage in Texifornia is provided at the time of maximum opportunity when ABA therapy is most likely to be effective - for three consecutive years up to age ten. II. THE WELLSTONE ACT PERMITS A LARGE-GROUP HEALTH POLICY TO LIMIT COVERAGE FOR ABA THERAPY TO CHILDREN UNDER AGE ELEVEN AS PERMITTED BY TEXIFORNIA LAW.

whether the limitation is imposed directly on a mental health benefit according to the plans terms and federal and state law. 1. The definition of autism should be construed in Reeds favor where the health plan fails to define mental health condition. Where there is an ambiguous term in an insurance policy, the ambiguity must be construed in favor of the insured.26 The plan fails to define a mental health condition. Settled precedent and notions of fairness require construing the terms of the policy against Pluribus Health. 2. Texifornia law indicates that autism is a mental health condition bringing the health plan in accordance with state law. Texifornia lists autism in two statutes in its Insurance Code. The court of appeals failed to analyze either of the two relevant statutes in Texifornias Insurance Code. In doing so, the court improperly acted as a superlegislative body. 27 3. Federal law includes autism as a mental health condition. The Interim Rules discuss autism as a mental health condition on par with chronic illnesses such as schizophrenia. 28

Petitioner A. The Wellsone Act Governs Any Group Health Plan That Offers Mental Health Benefits Whether a treatment limitation is impermissible depends on
Moore, 637 F.3d at 1230, 1235 42 C.F.R. 440.230(b); CMS Manual 5122(F); DeSario, 139 F.3d at 93 25 Pharm. Research & Mfrs. of Am. v. Walsh, 538 U.S. 644, 665 (2003)
23 24 26

Kunin v. Benefit Trust Life Ins. Co., 910 F.2d 534, 535 (9th Cir. 1990) Sniadach v. Family Finance Corp., 395 U.S. 337, 339 (1969) 28 Interim Rules MHPAEA, 75 Fed. 25 Reg. at 5423
27

Respondent Because ABA therapy is not a mental health benefit under the Pluribus insurance plan, the Wellstone Act is not controlling. Even if ABA therapy is a mental health benefit, limiting treatment to children under the age of eleven is permissible under the Wellstone Act because Pluribus similarly limits other medical benefits to children of a younger age. A. ABA Therapy Is Not a Mental Health Benefit Governed By the Wellstone Act The Wellstone Act defines mental health benefits as those with respect to services for mental health conditions.29 A mental health conditionis defined under the terms of the insurance policy and in accordance with State law. 1. Behavioral therapy for autism is not a mental health benefit under the Pluribus insurance policy Pluribus's insurance policy delineates Mental Health Services, Mental Health Conditions, and Substance Abuse Disorder in its own category. ABA is described as behavioral therapy and is explicitly listed in the category of Other Services A reasonable person would understand that, due to ABA's inclusion in the category of Other Services, it cannot also be considered a mental health service 2. Autism is not a mental health condition in Texifornia Texifornia state law specifically excludes autism from its definition of mental health condition in its Insurance Code.
29

This Court should infer that autism was deliberately excluded by the Texifornia state legislature.

3. Congress never intended to mandate treatment for autism as a mental health benefit under Wellstone Act. Petitioner B. Because autism is a mental health condition, ABA therapy is a mental health benefit. Pluribus Health does not contest that ABA therapy is a mental health benefit when autism is a mental health condition. Once a condition is considered a mental health condition, any service provided in response to that condition is correctly defined as a mental health benefit. C. The plans age limitation for ABA therapy is more restrictive than treatment limitations for medical or surgical benefits under the plan. 1. The age cap is a prohibited quantitative treatment limitation because it is applied more restrictively against mental health benefits than medical or surgical benefits. Quantitative limitations on mental health benefits are impermissible when they do not apply to substantially all medical or surgical benefits within a classification.30 Because age is a quantitative treatment limitation, the Wellstone Act prevents Pluribus Health from imposing the limitation on a mental health benefit that is not also applied to medical or surgical benefits in the same classification. The only comparable limitation in Pluribus Healths policy
30

42 U.S.C. 300gg-5(e)(4)

45 C.F.R. 146.136(c)(3)(i)(A) (2011)

for a medical or surgical benefit applies to colorectal cancer screenings. No other limitation within the plan even approaches the level of restriction as the age cap on ABA therapy as imposed by Pluribus Health.

Respondent When the original Mental Health Parity Act was passed in 1996, Congress understood that the act did not offer complete parity between mental health benefits and other benefits.31 Congress agreed to the language of the addition that the determination of a mental health benefitbe in accordance with state law. This Court has accepted Congress's legislative policy of maintaining the supremacy of the states in the realm of insurance regulation.32

Federal regulations specify six classifications of benefits: inpatient, in-network; inpatient, out-of-network; outpatient, innetwork; outpatient, out-of-network; emergency care; and prescription drugs. ABA is treated as an outpatient benefit. Therefore, it is in the outpatient, in-network classification of benefits and must be compared to age limitations of other outpatient, in-network medical or surgical benefits. Petitioner 2. Public policy and the underlying purpose of Wellstone dictate that the age cap on ABA therapy is arbitrary and capricious. Congress sought to end disparity between coverage of mental health benefits and coverage of medical benefits through the enactment of the Wellstone Act.

B. Limiting Coverage to Children Under Age Eleven Is a Permissible Treatment Limitation Under Wellstone Even if ABA is deemed a mental health benefit under the Wellstone Act, an exclusion of certain forms of treatment rationally based on the age at which treatment is most effective is not a prohibited treatment limitation. 1. Limiting coverage to children under age eleven is an allowable quantitative treatment limitation.
142 Cong. Rec. S9917 (daily ed. Sept. 5, 1996) See U.S. Dep't of Treasury v. Fabe, 508 U.S. 491, 500-01 (1993); 15 U.S.C. 1012(b) (2006)
31 32

Many states completely limit their mandate of coverage for autism to children between the ages of six and twelve.34 Most states limit coverage because of how costly treatment for autism can be. Treatment at AAT, for example, costs $4200 a month If considered in the context of the states with the least restrictive age limitation, twenty-one years of age, the total cost to Pluribus to insure Reed's therapy would amount to $317,520. Congress has passed a number of laws touching on the issue of insurance, and the one common theme has been to keep insurance affordable.35 The Wellstone Act was never intended to provide blanket coverage of treatment for mental illnesses and was only passed when Congress determined that mandating parity between mental illnesses and physical illnesses would not increase costs of insurance.

Respondent Pluribus imposes age limitations on other medical benefits in the same classification, thus it may also limit coverage of ABA to children under the age of eleven. 2. Pluribuss policy is in accordance with state law, and other state laws similarly limit mandated coverage of ABA therapy to children of a certain age. Most states that mandate insurance coverage for autism distinguish between age groups, mandating lower coverage amounts for children above the age of seven to nine years old.33
33

20-826.04(D) (2008) 34 See Tenn. Code Ann. 56-7-2367(a) (2006), Va. Code Ann. 38.23418.17(A) (2011) 35 See Seven-Sky v. Holder, 661 F.3d 1, 6 (D.C. Cir. 2011)

See, e.g., Kan. Stat. Ann. 75-6524(a)(3)-(4) (2010), Ariz. Rev. Stat. Ann.

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