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Does Your Health Plan Have a “Ghost Network”?

When Erin* first learned that her young son was showing signs of autism and would need to undergo testing, her stress and anxiety surged. Later, when he was diagnosed, those feelings intensified as she juggled assembling a care team for her son with daily childcare coordination and her full-time job.

Finding herself in “a state of panic,” Erin knew that she needed help from a mental health care professional to deal with the turmoil she was experiencing. “I needed to find someone to talk to before going through a total meltdown,” she says.

Her husband’s health plan, a major insurance carrier, seemed good on paper. Little did she know that in many insurance networks, finding a therapist is at minimum a tedious task of calling offices and at worst, impossible to find anyone accepting new patients in a reasonable timeframe.

“I must’ve contacted at least 15 different providers,” Erin recalls. “Most, if they responded at all, said they weren’t accepting new patients.” This only increased her anxiety and needlessly delayed her care.

Julie, another woman juggling work and motherhood, is searching for a therapist to help her cope with postpartum mental health issues. For postpartum depression, getting treatment quickly is crucial. Delays can lead to complications for both the mother and child. But after calling a number of therapists on a list provided by her OB-GYN, she became increasingly discouraged as one after another informed her that they wouldn’t accept her insurance.

“It’s pretty frustrating because a lot of therapists don’t have websites and you’re just kind of calling these numbers and waiting,” she says. “I get disheartened and then am like, ‘Maybe I’ll just forget about it.’”

Unfortunately, situations like Erin and Julie’s are common. Despite the one in five people with a mental health condition in the U.S. in a given year, mental healthcare remains the only underutilized area of healthcare in the country. That’s largely because the path to getting care is often riddled with obstacles, including:

  • Insufficient insurance coverage and high out-of-pocket costs, with many high-quality providers not accepting insurance at all
  • Lack of evidence-based care delivered by providers in insurance networks
  • Lack of awareness about available care options
  • Unavailability of providers who claim to accept insurance

We call the phenomenon of insurance directories filled with providers who are not accepting patients “ghost networks.” The dearth of accurate provider information affects other areas of health care, too, but is less severe. For example, researchers conducting a secret shopper-style audit of primary care doctors in California in 2015 were only able to make appointments with 64 percent of the providers contacted. But in a similar 2015 study assessing the accessibility of psychiatrists in three major U.S. cities, the results were far worse. Researchers could only get an appointment with 26 percent of 360 psychiatrists from Blue Cross Blue Shield’s in-network provider list. And 16 percent of the directory listings were wrong numbers – instead of psychiatrist’s offices, some of the numbers listed were for a McDonald’s restaurant, a jewelry store, and a clothing boutique.

The study’s findings support previous research revealing that two-thirds of primary care physicians were unable to get outpatient mental health care for their patients, as well as research showing that only 55 percent of psychiatrists accept insurance, versus 88 percent of physicians in other specialities. For children and teens seeking mental health care, the situation is even more dismal; researchers in another survey found that they could make appointments with just 17 percent of the child psychiatrists contacted in five U.S. cities.

Low in-network reimbursement rates discourage provider participation

At the heart of the problem is health insurers’ practice of reimbursing mental health care providers at far lower rates than other care types. According to a three-year analysis conducted by healthcare actuarial firm Milliman in 2017, therapists and mental health prescribers in the U.S. are paid 34 to 100 percent higher rates out-of-network than in-network.

Barbara Griswold, LMFT, a Bay Area-based therapist and author of “Navigating the Insurance Maze: The Therapist’s Complete Guide to Working with Insurance,” says insurance companies routinely reimburse her at half the rate she receives from cash-only clients, and that in some networks, her reimbursements remained the same for decades, despite being based in one of America’s most expensive cities.

“It’s a real cut in pay the more insurance clients you take on, so at some point, the providers on insurance networks may say, ‘I can’t take any more insurance clients,” she says.

With such meager reimbursements, not to mention the lack of payment for time spent doing additional paperwork to process insurance claims and follow up on claim denials, there’s little incentive for providers to participate in insurance networks, and a growing number are opting for cash-only payments. Meanwhile, better awareness of the efficacy of mental health care and waning stigma around seeking treatment is driving up demand for this care as the number of providers per capita is dropping, says Joe Parks, MD, medical director at the National Council for Behavioral Health.

“There’s so much demand for psychiatrists now that about 45 percent are able to charge cash-only,” Parks says. “If you can keep busy all day and get paid three times as much [as in-network], why wouldn’t you?”

This creates a vicious cycle in which many established providers opt out of insurance networks. As a result, the remaining providers in insurance networks are even busier and harder to access.

Outdated directories

Compounding the problems of low in-network payments and the demand for care outpacing provider availability is insurance companies’ failure to regularly update their provider rolls, and providers’ lack of incentive, since these directories are sources for low-margin patients, to keep them up to date.

“Many of the providers listed are retired, dead, or only working part-time,” says Parks.

Griswold believes that many providers remain on network directories despite not seeing insurance patients for various reasons. In some cases, it amounts to a lack of communication – a provider may fail to submit formal resignation paperwork or to alert networks after they’ve moved, for example. In addition, the financial instability of maintaining a private practice, especially in pricier urban areas with higher concentrations of providers, make it harder to give up a relatively reliable stream of insurance clients, she says.

“A lot of therapists consider leaving the network, but worry, ‘What if, in the future, I need those insurance clients to fill my practice, because $60 is better than $0,’” Griswold says. “That’s why a lot of providers just kind of hang out and ‘ghost’ – they’re there but they’re not there.”

What can be done?

Insurance companies should be held accountable for accurate directories, reasonable access to care, and a network of providers who deliver evidence-based care.

“Insurers aren’t doing their job – they promised an accessible panel and they’re not delivering that,” says Parks.

For their part, regulators in some states, including California and Massachusetts, have fined insurance networks over their inaccurate directories and long wait times to see a provider. These state agencies can also help ensure network adequacy by conducting more frequent audits of insurance networks. Data from state audits should be made publicly available so that customers and potential buyers have a clear picture of what they’re getting.

And as one of the primary buyers of health insurance plans, employers, too, have an important role to play in assuring that insurers deliver on the services they’ve promised.

“Employers are paying for their employees to get coverage for mental health disorders, and the only point of having coverage is if you can actually get access to care,” Parks says. “And they’re not getting what they’re paying for because their employees do not have access.”

Employees can also advocate for themselves by letting their human resources department know if they’ve had to call a long list of supposedly in-network providers and still can’t get an appointment, he says.

Without a major shift in the way insurance companies reimburse mental health providers, a growing number of employers today are stepping up to bridge the gaps that exist between insurers’ promises and members’ actual ability to access in-network care. In a 2018 survey conducted by insurance brokerage and advisory firm Willis Towers Watson, more than half of employers said they planned to invest in employees’ behavioral health.

One person who has benefitted from employers’ growing awareness on the issue is Erin – she’s now seeing a therapist through Lyra after her husband’s employer began offering the benefit. The care she’s received so far has been invaluable, she says.

“I’ve never had such a good therapist, and I feel lighter and can better manage my emotions,” she says. “I’m so lucky we had the option of Lyra just to get away from some of the friction you’re dealing with [using] medical insurance.”

For those who continue to rely only on insurance coverage for their mental health care, the prospect of finding the care they need remains daunting.

Without active participation from insurers, regulators, providers, and employers, substantial numbers of people will continue to go without care when they need it, impacting their families, their livelihoods, and putting their very lives at risk.

*Names of patients have been changed.


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About the author
Bob Kocher, MD
Co-Founder and President of Lyra Clinical Associates
Adjunct Professor of Medicine, Stanford University

Bob is the president of Lyra Clinical Associates, which works in partnership with Lyra Health to provide clinical services. He's an adjunct professor at Stanford University School of Medicine, senior fellow and advisory board member at the Leonard D. Schaeffer Center for Health Policy and Economics at USC, and guest scholar at the Brookings Institution. He serves on the advisory boards of Harvard Medical School Health Care Policy Department and National Institute of Healthcare Management. Bob served in the Obama Administration as special assistant to the president for healthcare and economic policy on the National Economic Council. In the Obama Administration, Bob was one of the shapers of the Affordable Care Act focusing on cost, quality, and delivery system reform and health IT policy.

By Bob Kocher, MD
Co-Founder and President of Lyra Clinical Associates
Adjunct Professor of Medicine, Stanford University
19 of September 2019 - 8 min read
Mental health at work
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