Letitia James announced a $2.5 million settlement with EmblemHealth after an investigation found the insurer repeatedly failed to provide accurate information and adequate access to mental health and substance use disorder care for its members.
The investigation by the Office of the Attorney General determined that Emblem maintained inaccurate provider directories, overstated the number of in-network behavioral health providers, and failed to comply with state and federal mental health parity laws. As a result, many members were unable to find timely or affordable care and were forced to pay out of pocket.
“As millions of New Yorkers struggle with anxiety, depression, and substance use disorders, ensuring access to quality, affordable mental health care is more essential than ever,” James said in a statement. “Health insurers cannot mislead consumers with inaccurate provider directories while families are left without care.”
Emblem covers about 1.5 million New Yorkers through commercial plans, Medicaid managed care, Child Health Plus, the Essential Plan, and New York City employee health plans.
The state launched its probe in 2023 and conducted a “secret shopper” survey of mental health and substance use disorder providers listed in Emblem’s online directory. Investigators found widespread errors, including providers who were unreachable, no longer practicing, not accepting new patients, or not actually in the insurer’s network.
According to the attorney general’s report, more than 80 percent of behavioral health providers listed as accepting new patients were effectively unavailable, creating so-called “ghost networks” that existed on paper but not in practice. Emblem’s internal surveys showed similar problems.
Under the settlement, Emblem will pay $2.5 million in penalties, fees, and costs. The company must also establish a restitution program to reimburse members who paid out of pocket after being unable to schedule appointments with in-network providers.
The agreement requires Emblem to make sweeping changes to its policies and oversight, including correcting inaccurate directory listings within two business days, adding tools for members to report errors, requiring providers to verify their information every 90 days, and removing providers who are inactive or fail to confirm participation.
The insurer must also conduct regular secret shopper surveys, track and resolve complaints about access to care, and publicly report its findings.
If inaccurate directory information leads to an unexpected out-of-network bill, members will only be responsible for their normal in-network copay or deductible. Emblem is also required to meet appointment standards — including access to urgent behavioral health care within 24 hours and an initial outpatient visit within 10 business days. If in-network care is unavailable, members must be allowed to see an out-of-network provider at in-network cost.
The settlement further requires Emblem to develop a statewide recruitment and retention plan to expand its behavioral health provider network. An independent monitor will oversee the restitution process and ensure the company complies with the reforms.
