Navigating the provider directories offered by insurance companies can be a frustrating and often disheartening experience for many patients seeking medical or mental health care. While these directories may initially appear to provide a robust list of in-network options, the reality often reveals a different story. Many listed providers are either not accepting new patients, operate solely within hospital settings, or are simply out of network. This situation is exacerbated by inaccuracies, including incorrect phone numbers and addresses, collectively leading to what has been termed a “ghost network.”
This issue has significant implications for patients, particularly as it can lead them to incur unexpected costs or delay essential care. The challenge is particularly pronounced for individuals seeking mental health services. Historically, efforts to hold insurance companies accountable for maintaining accurate provider directories have been largely ineffective. Although state regulators can impose fines for inaccuracies, enforcement is rare, and a federal law instituted in 1974—even if aimed to protect employers—restricts patients with employer-sponsored health plans from suing their insurance providers over such directory errors.
However, a recent class action lawsuit has emerged as a potential solution. It targets EmblemHealth, a health plan provider for New York government employees, alleging violations of state law concerning the accuracy of its health plan information. This legal action arises out of frustrations expressed by six New York City government workers who claim that EmblemHealth’s misleading network significantly obstructed their access to mental health care. Prior to 2024, EmblemHealth was the most popular insurance provider for city workers, but its recent changes in partnership with UnitedHealthcare have not alleviated the concerns.
Attorney Sara Haviva Mark, representing the plaintiffs, pointed out that the provider directory misrepresents the number of available in-network mental health professionals, misleading patients and effectively allowing EmblemHealth to gain members without compensating providers adequately. This discrepancy between advertised and actual network members has raised questions about compliance with both federal and state regulations, with the lawsuit further alleging that EmblemHealth has engaged in false advertising concerning psychiatric coverage.
An EmblemHealth spokesperson has refrained from commenting on the ongoing litigation, yet the circumstances surrounding this lawsuit encapsulate a broader crisis within the healthcare system. Val Calderon, one of the plaintiffs, shared her own harrowing experience. After suffering a miscarriage and grappling with suicidal thoughts, she found the search for in-network mental health support to be a distressing ordeal. Despite extensive efforts spent searching online and reaching out to numerous providers, she found little success, with most contacts either out of network or unavailable. The frustration Calderon felt transformed into a sense of helplessness as she realized that her health care coverage wasn’t providing the vital mental health support she needed.
The Association for Health Insurance Plans (AHIP) maintains that insurance plans strive to keep provider directories accurate and that it is also the responsibility of providers to report any changes. However, many providers argue that it falls squarely on insurance companies to ensure the directories reflect reality, claiming that it is often a challenge to have one’s name removed from a ghost network.
Concerns over ghost networks are not isolated; recent evaluations show a staggering 81% of entries in directories from several large health insurers contained inconsistencies or inaccuracies. The New York attorney general’s office recently highlighted stark findings, indicating that 86% of the mental health providers listed by one health plan were ghost entries, with EmblemHealth’s network suffering similarly.
In response to ongoing scrutiny, EmblemHealth has agreed to pay $2.5 million in penalties and fees to address these directory inaccuracies while also pledging to improve the reliability of its listings. Despite the settlement, Calderon was forced to seek out-of-pocket therapy at a cost of $160 per weekly session after abandoning her search for in-network support. This financial burden has forced her to tap into personal savings, but the value she finds in therapy has made the investment worth it, even amidst her demanding responsibilities as a teacher and a new parent.
As discussions around ghost networks evolve, the prevailing sentiment remains clear: change is urgently needed. Advocates like Calderon and her attorney are pushing for reform and holding insurance companies accountable, recognizing that the stakes extend far beyond financial implications—they are fundamentally about access to critical health care resources.
