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Historic settlement: Kaiser agrees to pay record fine, spend $150 million to improve mental health services

After 13 years of struggle and sacrifice by NUHW-represented mental health therapists, Kaiser Permanente has finally committed to fixing its behavioral healthcare system.

On Thursday, October 12, Kaiser agreed to pay a $50 million fine for its violation of mental health parity laws and spend $150 million over five years “to undertake a systemic overhaul” of its behavioral healthcare system. It’s the largest fine ever levied by the California Department of Managed Health Care.

The settlement represents a huge victory for Kaiser therapists and patients. Over the past decade, NUHW members have:

  • Helped pass laws that Kaiser could never comply with unless it invested more into behavioral health care

  • Raised awareness about the struggles faced by patients and helped them file complaints when they couldn’t get the care they needed

  • Held multiple strikes, including what at the time was the longest mental health strike in U.S. history.

Kaiser was facing two separate enforcement actions: An investigation in response to an increase in patient complaints, and an investigation into how it handled last year’s 10-week strike by Kaiser mental health therapists in Northern California.

State investigators found that Kaiser canceled 11,803 individual and group appointments during the strike, affecting 63,808 members. During the strike, many Kaiser patients spoke publicly about their appointment cancellations and stood with therapists on the picket lines. The settlement requires Kaiser to develop a comprehensive contingency plan to provide services during any future strike.

The Department of Managed Health Care released a formal statement about the settlement on Thursday, as well as its full investigatory report.

Among the many violations state investigators found included deficiencies in providing timely access to care, network adequacy, conformity to mental health parity laws, and grievance procedures for enrollees.

Many news outlets have covered the settlement, including the Los Angeles Times, San Francisco Chronicle, CBS News, CalMatters, Sacramento Bee, Orange County Register, Capital & Main and Courthouse News.

Kaiser was fined $4 million in 2013 for violating mental health parity laws, but failed to improve access to care. Now a decade later, there are mental health laws in place that Kaiser must abide by as well as a governor in Gavin Newsom, who is serious about enforcement.

In a statement, Newsom called the settlement, “a tectonic shift in terms of our accountability on the delivery of behavioral health services.”

NUHW President Sal Rosselli said the union still must be vigilant in making sure the settlement is fully enforced and that Kaiser works collaboratively with clinicians to build a better mental health care delivery system.

“We’re still a long way from real parity for mental health care,” he said. “But thanks to Kaiser caregivers and patients, we’re a lot closer than we were before.”

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