Anthem BCBS may face class action suit for alleged ‘ghost network’

By Doug Bailey

A first-of-its-kind lawsuit seeking class action status against Anthem Blue Cross and Blue Shield accuses the giant insurer of intentionally misleading patients by publishing a “ghost network” directory that falsely lists mental health professionals as being in-network when, in reality, they are not.

The suit, filed in the Southern District of New York, says the inaccurate and misleading directories led to financial strain, worsened mental health conditions, and undue frustration for those seeking care. The complaint claims that more than 80% of listed providers either do not accept Anthem’s insurance, are unreachable due to non-working phone numbers, or are mislabeled with incorrect specialties.

The complaint says such directories give the appearance of a robust network of in-network providers that attracts new customers who are then left unable to find adequate care when they most need it. The plaintiffs, listed as Jane Doe on behalf of Baby Doe, and Patricia Cavallaro-Kearns, report having to turn to out-of-network providers to access care, resulting in significant out-of-pocket expenses and stress.

The plaintiffs accuse Anthem’s practice of publishing a “ghost network” violates federal and state laws, including the federal Mental Health Parity and Addiction Equity Act, and the No Surprises Act.

In New York, Anthem operates under trade names including Anthem HealthChoice Assurance, Inc., Anthem Blue Cross and Blue Shield, and Anthem HP, LLC. Before changing its name to Anthem HealthChoice HMO, Inc. in 2024, it operated as Empire HealthChoice Assurance, Inc.; and before that, as Empire HealthChoice Inc; and before that, as Empire Blue Cross and Blue Shield.

'Secret shopper' study conducted

Attorneys for the plaintiffs say they conducted a “secret shopper” study and called 100 doctors listed in Anthem’s directory that supposedly accepted the BCBS insurance. Only seven out of the 100 actually accepted the insurance and would take new patients. The rest either did not accept the insurance, were not mental health providers, did not accept new patients, or were unreachable.

“We knew ghost networks were a problem, but we had no idea it was this bad,” said Steve Cohen, of Pollock Cohen, one of the lead attorneys representing the plaintiffs. “Both the New York State attorney general and the United States Senate have conducted similar secret shopper studies, and the findings were just shocking – it is nearly impossible to find doctors who accept this insurance.”

A spokeswoman for Anthem Blue Cross and Blue Shield said the company does not comment on pending legislation and the insurer has not yet filed a legal response to the suit.

The complaint contends that ghost networks are more prevalent in mental health than other medical fields, potentially due to the longstanding stigmatization of mental health treatment and fewer regulations around provider directories. For patients seeking immediate care, this maze of inaccurate information can exacerbate mental health issues, delay treatment, and discourage people from seeking help.

Accurate provider director called crucial

Legal experts note that if the allegations are proven, Anthem could face not only monetary damages but also be subject to equitable relief, requiring it to overhaul its directory practices. The plaintiffs seek injunctive relief to prevent further harm to consumers, arguing that an accurate provider directory is critical to fulfilling Anthem’s contractual and legal obligations.

The lawsuit emphasizes that mental health is a key component of overall well-being, and accessible mental health care is essential.

Lawyers for the plaintiffs say this is a first-of-its kind case that might set a precedent for how insurers maintain and present provider networks, especially in a sector where accessible mental health care has long been elusive.

“People in desperate need of medical care are intentionally being misled by their insurance company,” said Jacob Gardener, a partner at Walden Macht Haran & Williams and co-counsel for the plaintiffs. “It costs these patients not just money, but precious time to find necessary care. And that is for the lucky ones. Just imagine the anguish parents must go through when they cannot find affordable, qualified care for their children.”