Two health insurers are refuting a claim by the New Jersey Psychological Association that they are improperly requesting the personal mental health records before authorizing treatment or paying for services.

The NJPA, headquartered in West Orange, N.J., has filed suit against Horizon Blue Cross Blue Shield’s Horizon Healthcare Services and Magellan Health Services, as well as the New Jersey State Health Benefits Commission. The suit alleges that all three parties are improperly requiring mental health providers to turn over confidential records of patients enrolled in the New Jersey State Health Benefits Program before authorizing psychological treatment, continuing a course of treatment, or paying for services already provided, according to the group.

The NJPA, a private, nonprofit professional organization representing more than 2,100 psychologists in the state, is seeking a declaratory judgment that the three companies are violating state law.

The commission, which oversees the New Jersey State Health Benefits Program, the largest insurance plan operating in the state, handles payment of benefits and is accused of authorizing the actions by Newark, N.J.-based Horizon and Avon, Conn.-based Magellan outlined in the suit.

“People who seek mental health services trust that their personal information will be held in strict confidence,” said Lisa Jacobs, Ph.D., president of NJPA, in a statement. “Any violation of the patient’s right to privacy by the insurance industry or a government agency can have a devastating impact on the mental and physical health of the patient, and can deter people from getting the help they need.”

In a joint statement to IFAwebnews.com, Horizon and Magellan said their priority is “to see that members receive proper treatment” and that each company “respects the confidentiality rights of our members.”

The insurers said the information requested from providers “is entirely appropriate and consistent with applicable federal and state laws and the provisions of the New Jersey State Health Benefits Program” and that no laws are being broken.

“Horizon BCBSNJ and Magellan feel the lawsuit brought by the New Jersey Psychological Association is without merit,” the statement said.

Document dispute

The NJPA cites the state’s Practicing Psychology Licensing Act, providing broad protection of confidential communications between psychologists and their patients, prohibiting professionals from disclosing confidential communications and treatment notes and records to anyone, except as authorized by the patient.

Both insurers say there is nothing in that act, or any other law, that “changes the member’s obligation to satisfy medical necessity requirements for coverage under the New Jersey State Health Benefits Program or requires the Program to fund benefits without information establishing medical necessity.”

Those filing the suit, however, disagree, including Barry L. Helfmann, director of professional affairs for the NJPA and a practicing psychologist.

“In a misguided attempt to contain costs, insurance companies and state officials are making it increasingly difficult for people to access outpatient mental health services,” he said. “This mismanagement of care harms patients by delaying or denying access to counseling services shown to improve health and save money.”