Busting Ghost Networks: What You Can Do on the Front End

An employee at your company needs a medical specialist or therapist, quickly — so they pull up the provider directory for the employer-sponsored health plan and start calling the offices listed, only to hear:

“We’re not taking new patients.”
“We don’t take your insurance.”
“You have reached a number that is no longer in service.”

This employee — and perhaps many others around the company — may be encountering “ghost networks.” That is a problem for them … and for you.

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Ghosts in the Machine: Policing Provider Network Adequacy Issues

What Are Ghost Networks?

A ghost network is an inaccurate provider network for a health insurance plan. It may include incorrect information about the specialties available through an office, outdated office locations or contact details, providers that are not accepting new patients or who do not actually take the plan’s insurance — or even providers who have retired or died.

“Secret shopper” studies, during which U.S. congressional staff members, researchers or advocates spot-check a health plan’s directory by calling providers, found repeatedly low percentages of accurate listings: 18%, 17% and 27% in recent rounds. The problem is particularly pervasive among mental health listings — sometimes leading to devastating consequences for those unable to find care.

The pathway to quashing ghost networks — a fight that lawmakers, including U.S. Senators Tina Smith (D-Minnesota) and Ron Wyden (D-Oregon), have joined — is obstructed by a patchwork of unenforced regulations, said Abigail Burman, a consumer protection attorney with Motley Rice LLC.

“To be clear, ghost networks are against the law in a variety of ways,” Burman said. “They’re against regulations, they’re against the basic tenets of contract law — they are illegal behavior along a lot of dimensions. But laws don’t mean anything unless they’re enforced.”

There are steps employers — and their HR and total rewards professionals — can take to protect their workers. Their first tactic: Work to identify or mitigate ghost networks while shopping for a plan and finalizing a contract, with the goal of heading off problems before Day 1 of the plan year.

Do Your Research

Consider performing an internet search on the health insurance company (or companies) you are planning to contract with and see if there have been complaints, lawsuits or regulatory actions taken against that company in the past for incorrect provider listings.

You may also conduct your own “secret shopper” study. Pull the plan’s provider directory and call some of them — perhaps 100 offices, or a certain amount from each page in the directory — and see what percentage of providers are correct as listed, taking new patients and accepting that insurance.

“You might think you’re offering your employees a plan with access to tons of providers ... but you may need to do some due diligence, even though it’s not ultimately the employer’s responsibility to confirm the accuracy of an insurance company’s provider network. It’s the obligation of the insurance company to accurately report the information,” said Jake Gardener, an attorney and partner at Walden Macht Haran & Williams LLP and co-counsel in a ghost network class-action lawsuit.

If you’re considering a plan because of a specialty it touts as a selling point — whether it’s mental health, chronic pain care or weight loss — take a closer look at that portion of the provider listings, said Sue Abderholden, the executive director of the Minnesota chapter of the National Alliance on Mental Illness, who has worked for years to address limited access to care.

“Knowing there are certain specialties that might be more difficult to find care than others, call a few of those providers,” Abderholden said. “Find out if there are openings, or if [those providers] are even open, period.”

Cross-Examine the Contract

Pay attention to your contract with a health plan when seeking to preemptively mitigate issues with ghost networks, including by reading the plan’s evidence-of-coverage document: “Frankly, hardly anyone does, especially in small organizations, but you should,” Abderholden said.

Abderholden and Burman recommended that employers look for — or demand — these assurances in a contract:

A clear statement of what is considered a reasonable amount of time to wait for an appointment (for instance, having to wait six months to get in to see a therapist is “unacceptable,” Abderholden said).
A description of what is considered a reasonable distance an individual should need to travel to access care.
An outline of the number of calls, within a set period of time, that is reasonable for an employee to make, constituting a “good-faith effort” to find care (for instance, making five phone calls in a week, Burman said).
Provisions for resolutions the payor will offer if plan enrollees are unable to find care within the parameters outlined above. This can include the health plan itself finding and providing the employee with information about a provider that will be able to provide in-network care, and ensuring that if the employee needs to seek out-of-network care due to directory inaccuracies, they will only be charged in-network fees.

Afterward, be prepared to actually enforce that contract, Burman said. Prior to finalizing a contract and before the plan year begins, employers and their HR/TR professionals should secure the direct phone number of a contact at the health insurance company whom they can call if employees do encounter issues with listings — without having to wade through an automated system only to eventually be connected with someone who may not be able to help with that specific issue.

Taking these steps is in employers’ best interest, Gardener said.

“Health insurance is an important part of the benefits employees receive,” he said. “If an employer is providing health insurance that’s not high-quality, that’s probably going to be a factor the employee would consider when deciding whether to remain at his or her job.”

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