A decade ago, one of my best friends was walking down the street in midtown Manhattan when someone jumped off a building and fell onto him. Following this traumatic event, he started drinking to avoid the flashbacks, and had trouble returning to the city, where he worked. Although he tried to find a therapist to help him cope with the trauma, the search was so arduous that he didn’t end up getting into therapy. He didn’t try again to find help for seven more years, which led to major implications for his health and livelihood.
No one seeking help should struggle to get it. Eight years ago, his story inspired me to found a company focused on making high-quality mental health care more accessible through accepting insurance. And today, insurance networks have more mental health providers than ever who accept and work with insurance. Disappointingly, the problem of finding an in-network therapist persists for many patients like my friend.
What’s different today is that now lawmakers are stepping in to address access challenges.
Last month, the Office of New York’s Attorney General (OAG) announced a $2.5M settlement with Emblem Health after finding the company did not maintain accurate directories of mental health providers. According to the OAG, 80% of the providers listed in the Emblem directory were effectively unavailable, a term often referred to as a “Ghost Network.” Letitia James, the state’s attorney general, said “health insurers cannot mislead consumers with inaccurate provider directories while families are left without care.” When patients encounter ghost networks, they either postpone care, forgo treatment, or pay for more expensive out-of-network care.
Two things are noteworthy about this announcement: first, these challenges are not unique to one insurance company, and second, federal and state governments are increasingly taking action against companies when patients can’t access in-network care. The last three years have been marked by similar lawsuits, both state initiated and class action, announced and settled in California, Illinois, and New York. And in February, Congress passed the REAL Act (Requiring Enhanced and Accurate Lists of Health Providers Act), which requires Medicare Advantage plans to verify insurance directories every 90 days. Performance on network accuracy will be published and visible to the public starting in 2029, and may influence STAR ratings, posing a massive potential revenue risk to plans. In addition, members are protected from excessive out-of-network costs if they rely on an inaccurate directory listing.
With these penalties and regulations, the status quo for ghost networks is no longer a tenable option. So what makes it so hard to comply with these laws and what can insurance companies do?
Infrastructure Gap
First, it is difficult to keep track of mental health providers’ availability to see new patients. Caseloads for providers ebb and flow, and it is common for a provider’s availability to go from wide open to completely full in under a week.
Most directories are static and rarely updated. There is little to no technology connectivity for providers to keep up with these rapid changes. Plans do not intend to mislead, they often just lack the necessary infrastructure to accurately inform.
Closing the gap requires collaboration
Bridging this infrastructure gap is difficult for any one provider group or plan to do alone. Providers accept multiple plans, and they don’t have the capacity to juggle the tedious task of updating each plan on their availability while managing client care. Without reliable data from providers, it becomes difficult for plans to know how much availability is in their networks, let alone share that information with their members.
The result of this infrastructure and collective action gap is inefficient for everyone. On average, patients wait 48 days to get into care, and sometimes suffer severe consequences amid the wait, like the kind I saw firsthand with my friend.
Patient retention challenges
Plans have large teams who are investing in growing their networks. It can be discouraging to hear complaints about lack of access despite the time and effort dedicated to creating it. Availability is paid for, but not always delivered.
But availability isn’t always enough. Research suggests up to 45% of patients end therapy prematurely. Based on our own experience as a provider group and from conversations with patients who churn early, this is usually because patients don’t feel they’ve found the right match.
Patients need more than a provider who accepts their insurance and works with their schedule. They need one who has the specific skills, experience, and approach to meet and treat their individual needs. Without that, access doesn’t lead to successful outcomes.
Real-time scheduling achieves REAL Act compliance
Real-time scheduling application programming interfaces (APIs) are the way to address these problems. While providers do not have any time in their day allocated to updating insurance directories, they do manage their open appointment times as a regular part of managing their practices. Therefore, any changes to their schedule, if linked to a common API, can be reflected across all insurance directories. At any given time, there are many clinicians available to see a patient, providing a means of demonstrating compliance through showcasing available appointments, not just large lists of providers.
This solution exists and is working in practice for plans: plans such as Cigna, United, and Blue Shield of California have all announced features that have transformed their directories into dynamic, not static, places where members can find care. They’ve converted a potential liability into a competitive asset.
Moving towards a more dynamic architecture now achieves REAL Act compliance as a byproduct, while strengthening provider relationships by helping them fill their own practices, increasing patient satisfaction, and helping plans demonstrate the quality of their networks.
Those that wait until 2029 may find themselves delaying patient treatment, reacting to audit cycles, paying penalties, and ceding ground to the competitors who moved early.
I can only imagine what my friend’s life would have been like if he had found a great therapist right away. Making structural changes sooner rather than later does more than comply with the law: it can save and change lives.
Authors:
Sandeep Acharya is the founder and CEO of Octave, a modern behavioral health company contracting with more than 2,000 therapists and offering care across the country. A veteran in healthcare strategy and investing, he previously led strategy at the primary care practice, One Medical Group, and was an investor, operator, and consultant in the healthcare, retail, and technology sectors at Bain & Co, Bain Capital, and Insight Venture Partners.
https://www.linkedin.com/in/sandeep-acharya-he-his-52ab458/ sacharya@findoctave.com / hello@findoctave.com
Beth Jacobson is the General Counsel of Octave, as well as on the Board for Professional Medical Conduct of the NY State Department of Health. Before joining Octave, Beth was EVP – Strategic Initiatives and General Counsel at Kaia Health. Prior to that, she served as General Counsel at companies from startups to Fortune 500 companies. She also is a director of the Optimal Cancer Care Alliance. She holds a degree from Wesleyan University and her law degree from New York University School of Law.
https://www.linkedin.com/in/beth-jacobson-437a5b8/ bjacobson@findoctave.com / hello@findoctave.com
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