O.S.T. v. Regence BlueShield, 335 P.3d 416

Background

Washington statutes at issue: the 1989 neurodevelopmental therapies (NDT) mandate (RCW 48.44.450) requiring employer-group coverage for speech, occupational, and physical therapy for children age six and under, and the 2005/2007 mental health parity act (RCW 48.44.341) requiring parity coverage for medically necessary mental health services.
Plaintiffs O.S.T. (autism) and L.H. (expressive language disorder and other conditions) are insured under Regence BlueShield individual policies that contain blanket exclusions of NDT regardless of medical necessity. Regence denied coverage for O.S.T.’s therapies.
Plaintiffs brought a class action seeking declaratory relief and breach of contract; the trial court granted partial summary judgment invalidating blanket NDT exclusions in policies issued on/after Jan. 1, 2008; interlocutory review followed.
Key statutory definitions: the parity act defines “mental health services” as medically necessary services to treat DSM-listed mental disorders; the NDT mandate requires medically necessary NDT for covered children in employer group plans but sets a limited baseline scope.
The question presented: whether NDT can qualify as mental health services under the parity act and thus whether blanket exclusions in individual policies violate the parity statute when policies otherwise cover medical/surgical services.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Do neurodevelopmental therapies qualify as “mental health services” under the mental health parity act when used to treat DSM-listed disorders?	NDT used to treat DSM-listed disorders (e.g., autism, expressive language disorder) are medically necessary mental health services and must be covered.	NDT are distinct therapies often delivered by non-mental-health providers and therefore not necessarily "mental health services" under the parity act.	Held: Yes — NDT may be "mental health services" when medically necessary to treat DSM-recognized mental disorders; parity act applies.
Do the NDT mandate and the mental health parity act conflict such that the NDT mandate controls?	Plaintiffs: statutes can be harmonized; parity act provides broader coverage where NDT treats DSM-listed disorders.	Regence: expressio unius and general-specific rules mean the NDT mandate (specific) limits parity act (general); later parity act cannot expand obligations earlier limited statute impliedly.	Held: No conflict — statutes are harmonizable. The NDT mandate sets a floor for group plans; the parity act imposes additional obligations where therapies are medically necessary for DSM disorders.
Does Regence’s blanket exclusion of NDT violate the mental health parity act for individual policies that cover medical/surgical services?	Blanket exclusions (excluding NDT regardless of medical necessity) violate the parity act because some NDT can be medically necessary mental health services.	Regence contends the exclusion is valid and there is no justiciable issue or genuine dispute over medical necessity.	Held: Blanket exclusions are void and unenforceable for policies subject to the parity act when NDT may be medically necessary to treat DSM disorders.
Was summary judgment appropriate (is there a genuine factual dispute about medical necessity)?	Plaintiffs: Evidence (medical declarations, standards of practice) shows NDT can be medically necessary under Regence’s contract definition.	Regence: contends a factual dispute exists about whether NDT meet the plan’s "medically necessary" standard and about whether providers deliver mental-health services.	Held: Summary judgment appropriate as reasonable minds could not differ; under the contract’s broad definition and medical declarations, NDT may be medically necessary to treat DSM disorders, so blanket exclusions violate the parity act.

Key Cases Cited

Dep’t of Ecology v. Campbell & Gwinn, LLC, 146 Wn.2d 1 (statutory interpretation principles)
Camicia v. Howard S. Wright Constr. Co., 179 Wn.2d 684 (summary judgment standard)
State v. Armendariz, 160 Wn.2d 106 (statutory interpretation—legislative intent)
State v. J.P., 149 Wn.2d 444 (when statutory language is unambiguous)
In re Estate of Kerr, 134 Wn.2d 328 (general v. specific statute rule)
Residents Opposed to Kittitas Turbines v. State Energy Facility Site Evaluation Council, 165 Wn.2d 275 (harmonizing statutes; specific v. general)
Bellevue Sch. Dist. No. 405 v. Brazier Constr. Co., 103 Wn.2d 111 (doctrine against implied repeal)
Gilbert v. Sacred Heart Med. Ctr., 127 Wn.2d 370 (no implicit repeal where statutes harmonize)
Carr v. Blue Cross of Wash. & Alaska, 93 Wn. App. 941 (insurer liability limits and statutory mandates)
Diversified Indus. Dev. Corp. v. Ripley, 82 Wn.2d 811 (standing/justiciability for declaratory relief)