A federal court has determined that health insurers in New Mexico are not obligated to cover medical marijuana expenses, despite state law arguments to the contrary, according to a report from AM Best.
The ruling addresses the tension between state mandates and federal regulations, which currently restrict insurers from reimbursing medical cannabis costs.
The case was brought by a licensed marijuana dispensary and individuals using Medicaid and private insurance, who sought reimbursement for cannabis used in treating behavioral health conditions. They argued that New Mexico state law, particularly the Behavioral Health Services Act, insurance code, and unfair practices regulations, required insurers to provide coverage for medical marijuana.
However, the court sided with the defendants, namely Blue Cross and Blue Shield of New Mexico, Presbyterian Health Plan Inc., and Western Sky Community Care Inc., based on the structure of New Mexico’s Benchmark Plan. This plan, which guides insurer coverage in the state, does not explicitly cover cannabis and excludes reimbursement for substances that are not FDA-approved. As cannabis has not been sanctioned by the FDA, the court ruled that insurers were under no obligation to cover the costs of medical marijuana.
