Insurers issue defective & deceptive provider directories
July 7, 2021
June 25, 2021
San Diego sues Molina, HealthNet, Kaiser
By Nona Tepper
The city of San Diego sued three health insurers on Friday, alleging Kaiser Permanente, HealthNet and Molina Healthcare all advertised false networks of providers in an attempt to get consumers to sign up for their plans.
“Consumers should be able to trust their health insurers when seeking medical attention,” San Diego City Attorney Mara Elliot said in a statement. “Error-filled directories create dangerous barriers to healthcare services, with patients struggling to find a directory-listed doctor who will accept their insurance.” California law requires health insurers to update their printed provider directories quarterly and online listings weekly, the complaint said. These payers knew they were advertising false networks.
The complaints allege that up to 35% of the providers in Kaiser Permanente and HealthNet’s directories were listed inaccurately, and 80% of clinicians in Molina Healthcare’s directory were falsely listed as in-network.
Insurers’ error-riddled provider directories allowed them to attract more prospective enrollees and command higher prices, according to the suit. Falsely inflating their network size also made it harder for competitors to compete in the marketplace, the complaint said.
Each complaint said that insurers’ inaccurate listings disproportionately impacted low-income enrollees — who were more likely to be Black or Hispanic, according to the lawsuit — individuals with disabilities, people seeking mental healthcare, seniors lacking digital literacy, and women.
Each complaint noted that this was not the first warning insurers received.
Comment by Don McCanne
The dishonesty of these insurers in maintaining deceptive provider directories not only represents an unfair business practice, but it is also a violation of law that results in financial harm to patients, the very population that they should be serving.
If we had a single payer Medicare for All program, there would be no need for provider lists because all legal health care professionals and institutions would be automatically covered under one system. Further, we would not need to pay hundreds of billions of dollars to these superfluous intermediaries. (But think of a future for integrated systems such as Kaiser Permanente strictly as health care delivery systems and not as risk-bearing insurers.)
For those who say that we have a moral obligation to support the insurers, think again. Our moral obligation is to the patients, and we need to terminate the burden that the insurers are placing on them, and, incidentally, the burden that they are placing on the health care delivery system itself.