The state health agency has entered into a settlement in a federal lawsuit over the inadequacy of notices denying Medicaid recipients access to services.

U.S. District Judge Jim Brady, of Baton Rouge, approved the settlement, in which the state agrees to do a better job of providing specific information about the reasons for the service denials. He will oversee state compliance for the next five years.

The settlement came in a class-action lawsuit, Wells v. the Department of Health and Hospitals. The lawsuit alleged that the notices were so lacking that an individual would not know on what basis to appeal the denial and what kind of information would be needed to reverse the decision.

Advocacy Center lawyers who filed the lawsuit claimed the situation led to an infringement on the Medicaid recipients guaranteed due process rights.

The settlement covers notices sent by DHH as well as those sent by any of its contractors, including its five “Bayou Health” insurance companies and Magellan, who coordinated behavioral health services.

The agreement applies to Medicaid-eligible people who are denied prior approval for services.

“We have a responsibility to taxpayers to ensure appropriate use of medical services, but we have an equally important duty to ensure that our recipients understand these decisions,” state Medicaid Director Ruth Kennedy said in a news release. “We are grateful for the court’s guidance on this issue and to the Advocacy Center for their assistance in improving how we communicate with Medicaid enrollees.”

Advocacy Center lawyer Ellen Katz said the new notices promised by DHH will help Medicaid recipients better understand why DHH has denied services. “Recipients will know what information is needed to get prior approval for needed services at home, or other medical care and treatment,” Katz said.