Insurer Agrees To Pay Millions For Failing To Fix Errors That Made It Harder For Customers To Get Mental Health Care

EmblemHealth will compensate customers who paid out of pocket for mental health care because they couldn’t secure an appointment with a provider listed as being in-network. It also pledged to take additional steps to fix its provider directory.

This article was written by Max Blau and originally published by ProPublica.

One of New York’s largest health insurers is set to pay a multimillion-dollar fine for failing to fix a series of errors that made it harder for its customers to get mental health care.

EmblemHealth this week agreed to a $2.5 million settlement with the New York attorney general’s office because of the large number of inaccuracies in its listings of in-network mental health providers, a problem that has persisted for years.

The fine is the biggest secured by the state attorney general’s office in its yearslong quest to clamp down on the chronic problem of provider directory errors, also known as ghost networks. It’s an issue that has led customers to postpone treatment, forgo care and pay for more expensive out-of-network providers.

The office found that EmblemHealth overstated the availability of in-network mental health providers and failed to comply with state and federal laws requiring that insurers make mental health care as available as other kinds of medical care.

“Health insurers cannot mislead consumers with inaccurate provider directories while families are left without care,” Letitia James, the state’s attorney general, said in a statement.

EmblemHealth did not answer ProPublica’s questions. In a statement, a spokesperson said the insurer does “not admit” to the state attorney general’s findings but agreed to the settlement “to avoid time-consuming litigation.” The spokesperson added that the insurer has “focused on taking immediate steps to further support our members’ access to care.”

ProPublica’s 2024 series “America’s Mental Barrier” examined the ways that ghost networks can limit patients’ access to mental health care. Our reporting showed that the investigation by the state attorney general’s office into the ghost networks was one of the rare instances nationwide where health insurers faced consequences from elected officials.

Between 2018 and 2024, more than 360 EmblemHealth customers complained to either the insurer, a subcontractor that administered mental health benefits for the insurer or the attorney general’s office about such errors, the settlement said. But EmblemHealth failed to address the issue, the settlement said, even though the insurer had promised to do so as part of a settlement agreement reached in 2011.

A report from the office published in 2023 found that EmblemHealth and another dozen insurers had failed to keep their listings of mental health providers free of extensive errors. The office had contacted a sample of providers — nearly 400 listed in the 13 insurers’ directories — and most of them were “unreachable, not in-network, or not accepting new patients,” according to the report. The report found that 82% of the providers in EmblemHealth’s directory that were called were not available for an appointment.

This week’s settlement noted that EmblemHealth’s own investigations into the accuracy of its directory listings “have produced results similar to” those found by James’ office.

The insurer, which covers more than 3 million people in New York and in surrounding states, has now agreed to compensate customers who paid out of pocket for mental health care because they couldn’t secure an appointment with a provider listed as being in-network.

EmblemHealth also has pledged as part of the settlement to take additional steps to fix the errors in its listings. The insurer promised to correct inaccurate listings within two business days of being made aware of an error and to check every 90 days that each listing is accurate.

The settlement further calls for an independent monitor to oversee EmblemHealth’s progress to ensure that it complies with the settlement’s terms.

EmblemHealth is also the subject of a lawsuit filed in December by employees of the city of New York, who alleged that the errors in the insurer’s directory left them with a “deceptive” and “misleading” impression about the size of the company’s provider network. A spokesperson for EmblemHealth recently told ProPublica that the insurer does not comment on pending litigation.