The insurance giant Anthem Blue Cross Blue Shield of New York causes physical and financial harm to patients by publishing an inaccurate directory of doctors supposedly accepting Blue Cross insurance, though they in reality do not, two law firms said in a class action lawsuit filed this week.
Inaccurate directories, known as “ghost networks,” cause patients harm because they cannot find an in-network provider, the suit says. It causes financial harm because they must go out of network, and physical harm because they either encounter delays in finding care, cannot get care or abandon care because they cannot find in-network doctors who take the insurance — although they bought their policies believing that networks were adequate.
The case, accusing the insurer of fraud for the faulty directories, focuses on mental health care for both adults and children. The two class representatives wrote in the complaint about their struggles to find care, one for herself and one for a child. It was filed in federal court in the Southern District of New York by Steve Cohen of Pollock Cohen and Jacob Gardener of Walden Macht Haran & Williams.
Plaintiffs
One plaintiff, Patricia Cavallaro-Kearins, has been medically diagnosed with attention deficient hyperactivity disorder, the complaint says. She requires mental health care and pharmaceutical drugs to treat her condition. (See full complaint below.)
In seeking a provider after the onset of the pandemic, she “repeatedly found that many providers included in the directory were listed with inaccurate telephone numbers – making it impossible to reach them; others did not practice the specialties listed for them in the directory; and many simply did not accept her Anthem insurance. She spent hours, days, and months calling providers and could not find a single available, in-network provider using Anthem’s online provider directory.”
Another plaintiff, Jane Doe, is the mother of 8-year-old Baby Doe. Both Jane Doe and Baby Doe have been enrolled in the Standard Option Plan for more than five years, the complaint says.
“Baby Doe has been diagnosed with an autism spectrum disorder and requires regular occupational, speech, and mental health treatment by qualified mental health providers,” the complaint says. “Plaintiff Jane Doe started looking for essential mental health care for Baby Doe in 2018.
“Jane Doe was unable to financially afford out-of-network care. She had to forgo care for Baby Doe. Since 2018 and continuing through the present, she has regularly returned to the provider directory and called listed providers to no avail. It is both frustrating and discouraging every time Jane Doe turns to the provider directory and is unable to find care for Baby Doe.
“In late 2023, Jane Doe was able to secure a waitlist spot for one provider. The provider’s waitlist was six months long. Jane Doe has not yet heard from the practice that it has an available appointment and accepts the insurance. In short, Ms. Doe could not find an in-network doctor to treat her child at the time the child needed care. Baby Doe never received mental health care because her mother could not find an appropriate in-network doctor.”
Findings ‘shocking’
“We knew ghost networks were a problem, but we had no idea it was this bad,” Steve Cohen of Pollock Cohen said in a press release.
“Both the New York State Attorney General and the United States Senate have conducted similar secret shopper studies. But neither investigation was as extensive as the one we conducted on behalf of these plaintiffs. And the findings were just shocking – it is nearly impossible to find doctors who accept this insurance.”
Jacob Gardener, a partner at Walden Macht Haran & Williams and co-counsel for the plaintiffs, said: “People in desperate need of medical care are intentionally being misled by their insurance company. It costs these patients not just money but precious time to find necessary care. And that is for the lucky ones: just imagine the anguish parents must go through when they cannot find affordable, qualified care for their children.”
Not a new problem
This is not a new problem.
The American Medical Association president, Dr. Jack Resneck Jr., testified before a Senate panel investigating the problem in the spring of 2023.
“’When directory information is incorrect, the results can be complicated, expensive and potentially devasting, especially to patients,’ Resneck told the Senate Finance Committee, according to an A.M.A. press release.
“’Inaccurate directories shift the responsibility onto patients to locate a plan’s network or pay for out-of-network care,’ added Resneck, who chairs the University of California, San Francisco dermatology department. ‘Patients are financially impacted and may be prevented from receiving timely care. Moreover, in the long run, continuing to allow inaccuracies makes it easier for plans to fail to build networks that are adequate and responsive to enrollees’ needs. Accurate directories are a basic function and responsibility of health plans offering network products.”
In 2022, federal law instituted new penalties for inaccurate network listings under the Consolidated Appropriations Act of 2021. But not much seems to have changed.
Group health plans, insurance issuers and providers are required to take specific steps to protect insured people from out-of-network bills. They must take specific steps to improve provider directories and bear certain costs when inaccurate directories cause patients to incur out-of-network bills.
Under the C.A.A., the database of in-network providers must be public; must have an established verification process; must have a response protocol for insured people’s phone queries and electronic queries; and other similar protections. The C.A.A. also requires that the directories be accurate.
At the Senate hearing on “ghost networks” in May, Committe Chair Ron Wyden discussed the bill he had introduced previously with Tina Smith last Congress to impose penalties on insurance companies.
Problem persists
in 2019, Jack Turban, who was starting his training in psychiatry, took his professor’s advice and sought to find a psychiatrist, to understand the process better. In an article for Stat, he wrote: “I started calling a list of psychiatrists who supposedly took my insurance. Some of them were dead. Many weren’t taking new patients. Others didn’t take my insurance. I couldn’t find a single psychiatrist on the list to see me. It took months of networking for me to finally find a therapist. I later found out that my experience was commonplace, possibly deliberate, and that such inaccurate provider lists have a name: ghost networks or phantom networks.”
“My patients regularly tell me that this is not unique to Blue Cross Blue Shield and happens with most insurance providers. A 2016 survey by the Centers for Medicare and Medicaid Services showed that it’s also a problem with other medical specialties. The numbers, however, never seem as bad for other specialties as they do for psychiatry.”
His experience was similar to that in 2015 from a team of investigators on a National Library of Medicine study.
Posing as patients, “researchers called 360 psychiatrists on Blue Cross Blue Shield’s in-network provider lists in Houston, Chicago, and Boston. Some of the phone numbers on the list were for McDonald’s locations, others were for jewelry stores. When the researchers actually reached psychiatrists’ offices, many of the doctors didn’t take Blue Cross Blue Shield insurance or weren’t taking new patients. After calling every number twice, the researchers were unable to make appointments with 74% of providers on the list. In a similar study among pediatric psychiatrists, researchers were unable to make appointments with 83% of the providers listed as in-network by Blue Cross Blue Shield.”
