New Mexico Medical Cannabis Health Insurance Lawsuit Moved to Federal Court

The New Mexico lawsuit seeking to force insurance companies to cover the cost for patients enrolled in the medical cannabis program for behavioral health conditions – such as post-traumatic stress disorder (PTSD), opioid use disorder, and autism-spectrum disorder – has been moved to federal court at the request of the defendants, according to NM Political Report. The class action lawsuit was filed in June by Ultra Health, the state’s largest cannabis company, on behalf of six patients.

In asking the court to move the case from state to federal court, the health insurers argued that coverage for at least two of the plaintiffs is governed by the Employee Retirement Income Security Act which “completely preempts those claims and converts them into federal claims that are removable to this Court.” Further, the defendants contend that the number and type of potential plaintiffs and the dollar amount involved fall under the jurisdiction of the federal Class Action Fairness Act. 

The lawsuit comes less than a year after lawmakers passed a law (Senate Bill 317) prohibiting insurers from requiring patients to share the cost of medications for mental or behavioral health. The lawsuit argues that the law should apply to patients using cannabis for their behavioral health conditions.

State Sen. Jacob Candelaria (D), one of the plaintiffs in the case who is also an attorney but is not working in that role on the case, told the Political Report that he is “not altogether surprised by this procedural movida except it’s not the first procedural movida we will see from them.”

“But I remain absolutely confident that this matter will eventually be heard in a state court, not a federal court, where a state judge will determine what the policy of New Mexico is, according to the legislature’s enactment of Senate Bill 317.” — Candelaria to NM Political Report 

The federal magistrate judge who was assigned the case could decide to send the case back to the state district court or the plaintiffs’ attorneys could motion to have it moved back to the lower court. Candelaria suggested, based on his legal experience, that there is nothing in the lawsuit that would require a federal judge’s ruling.

“In order to win, we have to show that Senate Bill 317 says what it says,” Candelaria said in the report. “That doesn’t require any court to determine what federal law means, doesn’t allow, etc. The legislature passed its bill knowing exactly what the federal law says.”

According to the New Mexico Department of Health, of the 134,101 medical cannabis patients enrolled in the state’s Medical Cannabis Program, more than 50% received recommendations to help alleviate the symptoms of PTSD, while autism spectrum disorder and opioid use disorder accounted for less than 1% each.   

The seven insurers named as defendants are 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.