Insurance Denial in Mental Health Care: A Case Study of Emily Dwyer

In a courtroom in New Orleans this April, federal appeals court judges grilled a lawyer from United Healthcare about the insurer's refusal to cover treatment for 15-year-old Emily Dwyer, who was suffering from severe anorexia. Emily had arrived at a residential treatment facility wearing clothes meant for her younger sister, signaling the severity of her condition. Despite her doctors recommending continued care, United Healthcare argued that Emily had improved and no longer needed treatment, citing evaluations by three psychiatrists who concluded her symptoms had diminished. The judges, however, were unconvinced. Judge Andrew Oldham, expressing frustration, pointed to the substantial evidence of Emily’s ongoing struggles, including compulsive body checking and a drastic weight loss during a short time away from the facility. He criticized the insurer's stance, suggesting it amounted to "gambling with her life."

This case sheds light on the broader issue of insurance denials for mental health care, particularly when the evidence strongly supports continued treatment. While many patients and families do not appeal such denials, some choose to fight back in court, challenging insurance companies that often have more resources and power. These legal battles expose how insurers can place patients' health at risk, with some decisions later deemed arbitrary or capricious by the courts. Judges have repeatedly criticized insurers for disregarding medical evidence and relying on biased or faulty reviews from psychiatrists.

In some instances, insurers continue to use the same doctors even after they have been found to make errors in previous cases. Court records reveal numerous instances where psychiatrists, hired by insurers, made serious mistakes that were later discovered by judges. These mistakes include misreading medical records, ignoring opposing medical opinions, and offering flawed reasons for denying treatment. The cases show how insurers often change their justification for denials when confronted with evidence of error, making the process even more confusing for patients and families.

One such psychiatrist, Dr. Barbara Center, was at the center of multiple lawsuits over improper denials of mental health coverage. In the Dwyer case, she recommended denying further treatment, even after her medical team provided compelling evidence of the patient's ongoing struggles. In a previous case, Center had been criticized for providing inaccurate information about a patient’s condition, which led to a court ruling that the insurer's denial was unjustified. Despite this, Center’s evaluations continued to be used in similar cases.

The Department of Labor, responsible for overseeing health insurance compliance, has acknowledged that some insurers have engaged in these questionable practices, but it lacks the resources to fully address the issue. Although the department has filed amicus briefs in some high-profile cases, there is little oversight over the hiring of these psychiatrists or their decision-making processes.

The impact of insurance denials can be devastating for patients, particularly those undergoing treatment for mental health conditions. In Emily Dwyer's case, her family was forced to spend their savings and even refinance their home to continue her care, as the insurer refused to cover further treatment. Without the financial means to continue, many families are left to face the harsh reality of having their loved ones' health placed in jeopardy.

Conclusion

The case of Emily Dwyer is emblematic of a larger issue in the U.S. health insurance system, where denials of mental health care continue to place patients in harm's way. The lack of transparency, accountability, and oversight in the decision-making processes of insurance companies raises significant concerns. Until meaningful reforms are implemented, families like the Dwyers will continue to face difficult decisions, fighting not only for their loved ones' health but also for the fair treatment they deserve.