Cannabis class action lawsuit over insurance moves to federal court

A class action lawsuit challenging health insurance companies’ refusal to cover the costs of medical cannabis has moved to federal court — for now.

The lawsuit, filed earlier this year by a group of medical cannabis patients and a cannabis-producing company, originally asked a state district court judge to order New Mexico health insurance companies to cover medical cannabis costs for members. The seven insurance providers, in turn, refiled the case in federal court, arguing that it is the appropriate venue because the plaintiffs’ claims are inherently bound by federal law.

In June, six New Mexico medical cannabis patients and cannabis producer Ultra Health filed the class action lawsuit, arguing that the recent enactment of a state law requiring insurance providers to cover the costs of behavioral health services also must include medical cannabis. In turn, last week, attorneys for the insurance companies moved the case to federal court, arguing that the federal Employee Retirement Income Security Act, which sets standards for many health insurance plans, “ prevails” over the plaintiffs’ claims. Lawyers for the insurance providers also justified moving the case to federal court because the lawsuit “necessarily raises disputed and substantive issues of federal law,” specifically whether the federal Controlled Substances Act allows a state to require coverage of a substance. which is still illegal at the federal level. The final claim warranting removal to federal court argues that the type of class action defendants filed should be in federal court.

The lawsuit came a few months after the enactment of a state law that prohibits cost sharing for behavioral health services. After signing the legislation into law, Governor Michelle Lujan Grisham praised the bill in a press release.

“We can make a real and significant difference in reducing costs for people with insurance seeking help by eliminating copays for behavioral health services, and I am so proud and grateful to sign this priority measure,” said Lujan Grisham. .

The state agency in charge of regulating insurance has maintained that the department, which is one of the governor’s cabinets, has no authority to compel insurance providers to cover cannabis.

One of the plaintiffs is Albuquerque attorney and New Mexico state senator Jacob Candelaria. Candelaria, who is not serving as an attorney on the case, has been open about his cannabis use and his status as a medical cannabis patient for several years. He has litigated workers’ compensation cases in the past.

Candlemas said NM Political Report who sees the case moving to federal court as a delaying tactic.

“I am not at all surprised by this procedure moved except it’s not the first procedure moved We’ll see about them,” said Candelaria. “But I remain absolutely confident that this matter will ultimately be heard in state court, not federal court, where a state judge will determine what New Mexico policy is, consistent with the enactment of Senate Bill 317. by the legislature.”

In theory, the federal judge to whom the case was assigned could return the case to the state district court or the plaintiffs’ attorneys could file a motion to have it returned to the lower court. And while Candelaria is not necessarily part of the legal strategy discussion, she said, based on his legal experience, there is nothing in the lawsuit that requires a federal judge’s decision.

“To win, we have to show that Senate Bill 317 says what it says. That does not require any court to determine what the federal law means, what it does not allow, etc.,” Candelaria said. “The legislature passed your bill knowing exactly what the federal law says.”

Duke Rodriguezthe CEO and president of Ultra Health, who has filed numerous lawsuits against the state regarding cannabis regulation, and whose previous titles include Chief Operating Officer of Lovelace Health Plan and the New Mexico Secretary of Human Services, agreed with Candelaria that the move to federal court is a delaying tactic. But Rodriguez also said the federal court filing, filed by attorneys for the insurance providers, included a reference to cannabis that Rodriguez found “highly offensive, pejorative, even bordering on racist.”

“Throughout their plea, they refuse to use the word cannabis,” Rodriguez said. “And every reference to it is marijuana.”

While cannabis is the more scientific term for the plant, many have criticized the use of the word marijuana, claiming that the term originated in the US. for racist views.

Rodriguez said he hopes insurance providers will consider the hundreds of thousands of medical cannabis patients in New Mexico who are also enrolled in one of the providers’ plans.

“These insurers need to seriously consider the message they are sending to these 135,000 New Mexico adults when choosing which health plan to sign up for.

According to the New Mexico Department of Health, there were 134,101 medical cannabis patients enrolled in the state’s Medical Cannabis Program. Of those patients, more than 50 percent received recommendations from medical professionals to use medical cannabis to help relieve symptoms of post-traumatic stress disorder. Opioid use disorder and autism spectrum disorder each account for less than one percent of medical cannabis patients in New Mexico.

The state Department of Regulation and Licensing reported more than $16.5 million in medical cannabis sales in June. That number was down nearly $1 million compared to May sales. Medical cannabis sales in May also fell by almost the same amount compared to April, when sales for recreational use began.

Regardless, June medical cannabis sales break down to more than $120 per registered medical cannabis patient. The cost of cannabis flower in New Mexico ranges from $8 to $15 per gram. It’s hard to say what defines light, moderate or heavy cannabis use, and some medical conditions may require more frequent use, but Candelaria, who uses cannabis to combat symptoms of post-traumatic stress disorder as a result of sexual abuse as a child, said who is lucky to be able to afford it. her the $1,000 a month she spends on cannabis.

“I can pay out of pocket,” he said. “I spend about $1,000 a month on cannabis, and I can afford that. A lot of people can’t, and that’s why I’m in this fight.”

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