New Mexico Lawsuit Seeks Insurance Coverage for Medical Cannabis

A New Mexico cannabis company and a group of six medical marijuana patients have filed a class-action lawsuit that seeks insurance coverage for medicinal cannabis. The legal action was filed on Friday in Albuquerque state district court, with the plaintiffs arguing that medical cannabis should be covered because it is a valid behavioral health service.

The plaintiffs in the suit are New Mexico Top Organics-Ultra Health and six medical cannabis patients including state Sen. Jacob Candelaria. Documents filed in the case note that Candelaria has been a medical cannabis patient since 2019, when his physician recommended that he use medicinal cannabis to treat post-traumatic stress disorder after antidepressants failed to provide relief. Candelaria pays between $500 and $1,000 per month out of pocket for his medication because his insurer, Blue Cross and Blue Shield of New Mexico, fails to cover medical cannabis for its customers, according to the lawsuit.

With the legal action, the plaintiffs in the case are seeking “recovery for themselves, and for every other similarly situated behavioral or mental health patient unlawfully subjected to paying for the entire cost of medically necessary cannabis, in violation of state law.”

The lawsuit names Blue Cross and Blue Shield of New Mexico, True Health New Mexico, Cigna Health and Life Insurance Co., Molina Healthcare of New Mexico, Presbyterian Health Plan, Presbyterian Insurance Co. and Western Sky Community Care as defendants in the legal action. The lawsuit is based on legislation passed last year, Senate Bill 317, which requires insurers to cover 100% of the costs for behavioral health services, including treatments prescribed for behavioral health conditions. The measure was passed in April 2021 and went into effect on January 1 of this year.

“The idea of health insurance plans paying for medical cannabis may seem like an impossible dream, but all the foundational elements have already fallen into place,” Ultra Health president and CEO Duke Rodriguez said in a statement to the Albuquerque Journal on Monday. “Revolutionizing behavioral health care in New Mexico will take only a few small steps, rather than a giant leap.”

February Letter Sought Coverage for Medical Cannabis in New Mexico

In February, Ultra Health sent a letter to insurers and the Office of the Superintendent of Insurance seeking coverage for medical cannabis recommended to treat behavioral health conditions. The letter included data provided by the New Mexico Department of Health in April that indicates of the 134,307 patients enrolled in the state medical cannabis program, 73,000 have been diagnosed with PTSD.

“Ultra Health acknowledges that the idea of health insurers paying for medical cannabis may seem novel at first blush,” the company wrote in its letter to Presbyterian Healthcare Services. 

“However,” the letter continues, “it is actually a rational, reasonable notion when considered in light of other New Mexico law. New Mexico already requires workers compensation insurers to pay for medical cannabis, and New Mexico already treats medical cannabis the same as conventional prescription medications. The fact that health insurers should—and will—pay for medical cannabis is not revolutionary at this point. It is the next logical step, and it is a small step, not a giant leap.”

True Health New Mexico and Blue Cross and Blue Shield of New Mexico declined to comment on the case, according to media reports. Molina Healthcare of New Mexico, Western Sky Community Care and Cigna did not immediately respond to requests for commentary. Presbyterian Health Plan and Presbyterian Insurance Co., which are overseen by the same management team, also declined to comment on the case but issued a statement on the companies’ policies.

“Presbyterian Health Plan is committed to ensuring that New Mexicans can access the behavioral health services they need,” spokeswoman Melanie Mozes said. “We have not yet been served with the lawsuit and will reserve comment for the appropriate venue.”

Rodriquez said that the lawsuit was filed after the insurers and state regulators failed to respond to the letter sent in February. He also noted that other patients who have been impacted by the insurers’ failure to cover medical cannabis prescribed as a behavioral health treatment are welcome to join the legal action.

“There will be more patients identified who have been harmed by insurers not lawfully abiding to the statutory duty of eliminating any cost sharing related to behavioral health services,” Rodriguez said. “Insurers have not acted in good faith.”

In an interview, Candelaria said that medical cannabis has helped him cope with PTSD and positively affected his life. He added that he joined the legal action to help all “New Mexicans who are struggling to pay for their health care.”

“Senate Bill 317 was transformational,” Candelaria said. “This suit, you know, it becomes necessary to actually make that transformation happen.”