Parents have searched for effective therapies for children with autism spectrum disorder. One therapy that has shown promise, at least for some children, is applied behavior analysis (“ABA”), which is an intensive behavioral interaction health service. However, ABA is expensive, in some cases requiring many hours of therapy weekly. Insurance carriers and self-funded health plans have been concerned about covering ABA because of those costs. A recent federal district court decision from Oregon found that the failure of an insured health plan to cover ABA for children with autism spectrum disorder violated the federal mental health parity and addiction equity act as well as similar Oregon state laws. The federal parity act requires ERISA plans to cover mental health and chemical dependency disorders on the same basis as medical and surgical treatments are covered. The insurance company had denied coverage for ABA based on a developmental disability exclusion. The court found that exclusion to violate both the state and federal laws.

Employers whose health plans do not cover ABA will want to monitor this case and others challenging the exclusion of ABA to determine whether their plan designs must change to include that therapy.