Insurance companies are being sued over directories that aren’t real [PODCAST]

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Your insurance company says these therapists take your plan. Most of them do not. That is the allegation behind seven class action lawsuits now moving through courts from Massachusetts to California. Attorney Steve Cohen returns to explain what his firm found when it called the names on those lists. This episode is based on his article “Mental health ghost networks are badly hurting patients,” published on KevinMD. You will hear what a ghost network is, and why the problem is worst in mental health. You will hear why the listings stay wrong, which has less to do with sloppy record keeping than with what insurers will pay. You will hear which patients get hurt worst, including the ones whose plans carry no out-of-network benefit at all. And you will hear about the provision buried in most policies that requires your insurer to cover an out-of-network therapist when there is no in-network one. Press play for the two steps he tells patients to take in order, get the care first and fight for the reimbursement second.

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Transcript

Kevin Pho: Hi, and welcome to the show. Subscribe at KevinMD.com/podcast. Today we welcome back attorney Steve Cohen. His KevinMD article is “Mental health ghost networks are badly hurting patients.” Steve, welcome back to the show.

Steve Cohen: Thanks for having me, Kevin.

Kevin Pho: All right, so tell us why you decided to write this particular article on KevinMD, and then tell us about the article itself for those who didn’t get a chance to read it.

Steve Cohen: Ghost networks are the directories of doctors and therapists who supposedly accept insurance from a particular insurance company. In reality, for some specialties, particularly mental health, they are a sham. For many insurance companies, the listings, the directories they publish, simply are not real. 85 percent of the doctors and therapists listed either do not exist, do not accept the insurance, or won’t take a new patient. This is a pervasive and dangerous problem that more than a few insurance companies are perpetrating against the people who have those policies.

Kevin Pho: Now, how did you find out about this? How did you come across this issue?

Steve Cohen: I found out about it because a doctor called me. He was getting harassed by an insurance company. He was being audited by an insurance company. I tried to help him, and I was able to help him a little bit. And he said, “By the way, do you know what a ghost network is?” And I said, “I have no idea.” And he said, “Let’s do a little experiment together.”

And he named the biggest insurance company in New York City, and he said, “How many child psychiatrists do you think there are within 10 miles of downtown Manhattan?” The biggest insurance company. And I’ll ask you the same question, Kevin. The biggest insurance company in all of New York, how many child psychiatrists do they list as accepting their insurance?

Kevin Pho: Since you’re asking how many they’re listing, I’m probably going to say on the higher side. But tell me how many they’re listing, and tell me how many there actually are.

Steve Cohen: Well, that’s exactly the right reaction. 1,300 doctors were listed as being in this insurance company’s network, as accepting the insurance. The doctor then said to me, “Do me a favor. When we get off this call, have someone call the first 100 names on that list,” which we did.

And what did we find? Of the first 100, how many actually accepted the insurance, took new patients, or even existed? The answer was three. Three out of the first 100.

That’s not an anomaly. People started contacting us, patients as well as doctors, and said, “We’ve got a problem. We need mental health care. I need it for my kid, and when I call the doctors or the therapists who are listed, first of all, half the time the numbers are wrong or the doctor doesn’t exist. Then the vast majority of those that remain don’t take the insurance or won’t have an opening for months and months.”

So people who need medical care that is supposedly covered by the insurance company aren’t getting it. That’s the most serious problem. People are not getting care that they need. The second problem is that for those who can afford it, because there are no in-network doctors, they have to go out of network, and it’s incredibly expensive. They’re paying hundreds of dollars per visit on average. They’re getting reimbursed a little bit for out-of-network care, but it’s costing them net-net hundreds of dollars per visit.

We started investigating more, and we’ve now brought seven lawsuits ranging from Massachusetts to New York to California against major insurance companies for deceptive consumer practices involving ghost networks. These are class actions, and they involve hundreds of thousands of people in each class.

Kevin Pho: So from what I’m hearing with that child psychiatrist example, there were 1,300 listed in that insurer’s directory. You called the first 100. Only three took new patients or accepted that particular insurance. Now, speculating on potential reasons, is this a matter of list hygiene, or is there something intentional going on?

Steve Cohen: I think it’s the latter, and I think the former is just symptomatic. There are federal and state laws that say insurance companies have to clean up. They have to validate their directories every 30 to 60 days. So number one, they’re not doing it.

But the second part is a bigger problem, and that is that this is hurting insurance companies’ profitability. Mental health care doesn’t have the stigma. Happily, it doesn’t have the stigma that it once had, so people are seeking it. During COVID, more people sought mental health care. Insurance companies don’t want to pay for that, so they’re not paying doctors, or therapists, to be in-network. They’re not willing to pay anywhere near what doctors and therapists need just to run their practice. As a result, the insurance companies, which still have to certify that they have adequate networks, are just lying.

That’s our allegation. I’m sure they’re going to say otherwise, but the evidence is overwhelming. We’ve done, I think at this stage, 45 different secret shopper studies involving health insurance companies’ directories of therapists, psychologists, and psychiatrists. The very best network we found had only a 55 percent error rate. Only 55 percent were wrong. The worst are 100 percent wrong, and on average, 85 percent of the listings of psychiatrists and psychologists don’t exist, won’t take the insurance, won’t accept new patients. An 85 percent ghost rate.

Kevin Pho: Now, in the cases where the listings in the directory are wrong, how are they even being populated by the insurance companies? How are the listings created?

Steve Cohen: We’re guessing that they’re being populated by doctors who used to exist, who may have once taken the insurance, who may have been part of a different practice, and the insurance company is listing them as if they still exist, are still part of the network, still part of the panel, and are willing to take new patients. And it’s just rampant misrepresentation.

Kevin Pho: So where are we with these class action lawsuits? When you obviously bring this to the attention of the insurance companies, what are their responses, and what is the status of the class actions that you’re bringing?

Steve Cohen: We have seven class actions going on right now. We started this, I think, about three years ago, and everything moves incredibly slowly. And the insurance companies are fighting each lawsuit tooth and nail.

The one that is furthest along is here in New York State against Carelon, which is part of Elevance and a sister company of Anthem Blue Cross. We have 1.2 million people in that class who all work for the state of New York or other municipalities. And we survived the motion to dismiss, which is an incredibly important stage in litigation, and now we are moving into discovery. So we have asked for lots of documents, and we are going to start scheduling depositions of senior executives. What practices do they follow to ensure that the directories are accurate and up to date? Let’s see where it goes.

The others are all at earlier stages, where the insurance companies have all moved to dismiss the case on various grounds. In fact, in one of them, and this was Blue Cross Blue Shield again, they said that these people, who are federal employees, have no private right of action. If there’s a problem, they can complain to the U.S. Office of Personnel Management. But if you’re a federal employee, you have no private right to sue us. And we see lots of other defenses like that, that there’s no jurisdiction, that this should be dealt with administratively. They try to say, “Well, this should come under administrative, bureaucratic protocols because we have those set up for denial of care.”

This isn’t denial of care. This is not getting the care. They’re trying to get the care. It’s not as if they went to the insurance company and said, “Pay for this,” and the insurance company said no. They are trying to find a doctor or a therapist, and they can’t find any.

Some of the plans we deal with have no out-of-network benefit, so those people are in some ways the most hurt. If they’re in a plan that is low cost and they can’t afford to buy a plan that has an out-of-network benefit, they’re not going to get reimbursed at all if they go to an out-of-network provider, an out-of-network doctor. And those people have the least recourse and are the most hurt, because they’re not getting care at all. The people who go out of network, it’s costing them way, way more money than they ever expected, but at least they’re getting treatment. Their children are getting treatment. For those who don’t have this opportunity to use an out-of-network doctor, they’re not getting treatment at all.

Kevin Pho: So you mentioned that this is primarily happening in behavioral health services. Are you seeing this happen in other specialties as well?

Steve Cohen: We know that dentistry is a real problem, and we’ve talked to economists who’ve been studying this across the country. It happens in other specialties to a much smaller extent. When it’s 85 percent of the listings that are fake, that are inaccurate, that’s a crisis.

It’s tougher. I don’t know for a fact what it is for a dermatologist or a pediatrician or an oncologist. I don’t know. But the people who have come to us, the plaintiffs, the patients who said, “I can’t get help,” overwhelmingly in mental health care.

Kevin Pho: So obviously you are in the New York area. From your research and from what you’re hearing, do you feel like this is happening in other parts of the country as well?

Steve Cohen: Absolutely, it’s happening all over the country. We have two other active cases, two big class actions in California. It’s happening all over the country.

Kevin Pho: So from the patient perspective, knowing that 50 to 100 percent of behavioral health listings in an insurance directory are incorrect, false, or simply do not exist or do not take that insurance, what advice do you have for patients looking for behavioral health services? Should they just disregard these directories completely and go to Google and call individually? What are some of their options?

Steve Cohen: Well, the first option that people have, and they don’t know about this because it’s buried deep in an insurance policy usually, is that if there are no in-network doctors available, by calling the insurance company, often calling and then calling again and calling again and saying, “I can’t find someone in network,” they have to provide an out-of-network exception and pay an out-of-network doctor when there is no in-network alternative. The vast majority of patients have no idea that this provision exists in their insurance plan. That’s the first step.

The second is, if you just go to Google, or go to Zocdoc, or go to somewhere else, or I guess Psychology Today, which often has a better listing of who’s in-network and who actually takes what insurance, use that and get the care, and then fight with the insurance company to be reimbursed for it. Most important, get care. Second, get reimbursed for it.

Kevin Pho: So that was my next question, in terms of third-party options, and you did mention Psychology Today. So rather than relying on insurance companies themselves to accurately revise their directories, are there third-party options that are viable in terms of accurately giving listings to people who need behavioral health services?

Steve Cohen: I’m told that the Psychology Today directory is pretty good. I have not personally used it, but many of the people who we do represent, and whose stories we tell in these lawsuits, have found care, often out-of-network, but at least they found care using a more accurate directory like Psychology Today, and occasionally an in-network doctor, but rarely.

Kevin Pho: So from your experience, how do you foresee these class actions going in the foreseeable future?

Steve Cohen: How long is the foreseeable future? Look, everything takes longer with the law than it should, than one expects. These cases will take probably three to four to five years each, and we’re going to heavily litigate them. We are working with another firm, a very, very good firm named Walden Macht Haran & Williams, great litigators, and we’re going to take this through to the end. I’m sure it will be hard-fought every single step of the way.

Insurance companies, defendants, have two chances to throw a case out before it ever gets to trial. In fact, there’s a third for class actions. There’s the motion to dismiss step, which is based on whether there is a law under which this action can be brought. After discovery takes place, there’s what’s known as summary judgment, and then the third is class certification. How do you define the people who are in this class? And that has to be certified by the court. And then after you get over all three of those hurdles, then it can go to trial, and we are willing, and we hope, to go to trial on all of these.

Look, in reality, do most cases settle? Yes, they do. But in our practice, my belief is that I don’t take a case unless I’m willing to go to trial on that case, and we are absolutely willing and able to go to trial on each and every one of those cases.

Kevin Pho: Just hearing about this, to me it is stunning that something as seemingly simple as keeping your directory updated is leading to potentially years of litigation, and however many dollars, both on the plaintiff side and the insurance company side. Just the fact that these insurance directories are not updated. To me, that seems small, but obviously it isn’t.

Steve Cohen: You’re absolutely right. We ask not only for financial relief, damages for people who’ve been harmed, but the first thing we ask for is what is known as injunctive relief. And the simplest injunctive relief is this: Don’t lie. If you’re an insurance company, it’s not that hard to have an accurate directory. It may be very hard to pay doctors what they deserve and, as an insurance company, to make a profit and cover the services that are supposedly covered, but it’s not hard to have an accurate directory.

Don’t make it harder for patients who need care to find that care. If you have a small, even inadequate directory, be honest about it. Don’t send people on a wild goose chase, getting more and more frustrated that they can’t find a doctor. So the first thing we ask for is just clean up the directory. Be honest. That shouldn’t be hard.

Kevin Pho: We’re talking to Steve Cohen, an attorney. His KevinMD article is “Mental health ghost networks are badly hurting patients.” Steve, as always, let’s end with your take-home messages to the KevinMD audience.

Steve Cohen: Get the care you need, and don’t be afraid to ask for them to cover what you’re paying for and what you deserve.

Kevin Pho: Steve, as always, thank you so much for coming back on the show and sharing your insight and perspective.

Steve Cohen: Thanks for having me, Kevin.

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