Laying Ghost Networks to Rest: Combatting Deceptive Health Plan Provider Directories

Abstract

Errors in health plans’ provider directories, also known as “ghost networks,” are a pernicious feature of the American health care system, with some studies showing that more than half of all directory entries contain errors. These errors disrupt patients’ access to care, can lead to large, unexpected bills, and undermine the regulatory structure of the entire health insurance market. They also exacerbate existing structural inequalities. While there have been attempts to reign in ghost networks through regulation, this article analyzes state-level data to demonstrate the failure of existing directory accuracy policies. In response to the shortcomings of current regulatory approaches, this article proposes an alternative policy framework to prevent directory errors; one that is focused on regular enforcement, consistent fines for noncompliance, and engaging as many actors as possible in the enforcement scheme. Finally, this article explains why large portions of the proposed policy framework would comply with ERISA, meaning that states could apply it to all health plans. Crucially, while directory accuracy is just one piece of the puzzle that is ensuring that insurers provide adequate access to care, regulators’ inability to reign in directory errors (arguably the most straightforward component of network adequacy) is a canary in the coal mine, signaling health care regulations’ broader failure to effectively safeguard consumers’ health and financial wellbeing.

Keywords: insurance, consumer protection, health care, health disparities, health equity, ERISA, Medicaid, Affordable Care Act, California, Maryland, Louisiana, ghost networks, phantom networks, provider directories, insurance directories