EmblemHealth Hit with $2.5 Million Fine for Mental Health ‘Ghost Networks’
One of New York’s largest health insurers, EmblemHealth, has agreed to a $2.5 million settlement with the New York Attorney General’s office over persistent inaccuracies in its listings of in-network mental health providers. The settlement, announced this week, addresses a long-standing problem of “ghost networks” – provider directories that list clinicians who are unreachable, no longer accepting patients, or not actually part of the insurer’s network.
The $2.5 million fine represents the largest secured by the state attorney general’s office in its efforts to combat inaccurate provider directories, an issue that has led patients to postpone treatment, forgo care altogether, or pay higher costs for out-of-network services.
According to the Attorney General’s office, EmblemHealth overstated the availability of in-network mental health providers and failed to comply with state and federal laws requiring equitable access to mental health care. “Health insurers cannot mislead consumers with inaccurate provider directories while families are left without care,” stated New York Attorney General Letitia James.
The investigation revealed that between 2018 and 2024, more than 360 EmblemHealth customers filed complaints regarding access issues. Despite a previous settlement agreement in 2011 promising to address these errors, the problems persisted.
A 2023 report from the Attorney General’s office examined 13 insurers, including EmblemHealth, and found widespread inaccuracies in their mental health provider listings. The report revealed that 82% of the providers listed in EmblemHealth’s directory who were contacted were unavailable for appointments – either unreachable, not in-network, or not accepting new patients.
EmblemHealth’s own internal investigations reportedly yielded similar results, acknowledging the extent of the inaccuracies in its provider listings.
Under the terms of the settlement, EmblemHealth will compensate customers who incurred out-of-pocket expenses for mental health care due to the inaccurate directory information. The insurer has also pledged to take corrective action to improve the accuracy of its listings, promising to correct errors within two business days of notification and to verify the accuracy of each listing every 90 days.
An independent monitor will be appointed to oversee EmblemHealth’s progress and ensure compliance with the settlement’s terms.
The settlement comes as EmblemHealth also faces a lawsuit filed in December by employees of the city of New York. The lawsuit alleges that the inaccuracies in the insurer’s directory created a “deceptive” and “misleading” impression about the size of the company’s provider network. EmblemHealth has not commented on the pending litigation.
The issue of “ghost networks” and their impact on access to mental health care was highlighted in ProPublica’s 2024 investigative series, “America’s Mental Barrier.” The series noted that the Attorney General’s investigation into these networks was a rare instance of health insurers facing consequences from elected officials for such practices.
EmblemHealth covers more than 3 million people in New York and surrounding states.
