California Assembly Passes Local Assemblymember’s Bill to Combat ‘Ghost Networks’ and Ensure Accurate Provider Directories

AB 236, designed to address the issue of “ghost networks” and inaccurate provider directories, has cleared a significant hurdle by passing the California State Assembly. The bill, authored by Assemblymember Chris Holden, who represents Pasadena, aims to enhance current policies with accuracy standards, performance goals, and robust enforcement measures.

“Ghost networks should not be something we accept as reality,” Holden said in a statement. “This bill provides solutions for Californians struggling to find their unique care needs by making the information given to them accurate and accessible.”

Existing California law mandates that health plans cover out-of-network care if a consumer relies on a directory to access such care. Recent studies, however, have revealed alarmingly high rates of inaccuracies, Holden’s office said, with some health plans reporting rates as high as 80%.

Holden’s office saed in a release that major providers like Anthem and Kaiser have inaccuracies ranging from 20% to 38%, leading to what experts term “ghost networks” due to their non-existence.

“AB 236 puts benchmarks and policies in place to get our state to accurate health plan provider directories, so that Californians can access the services that they need,” said Katie Van Deynze, policy and legislative advocate with Health Access California. “This is a critical bill to breaking down barriers to care.”

The statement from Holden’s office said existing regulations for consumer protection are inadequate. The Department of Managed Health Care has issued only five enforcement actions, resulting in minor fines. AB 236 seeks to strengthen enforcement mechanisms and incentivize compliance among health plans, ensuring accurate information for enrollees.

The bill establishes numeric accuracy benchmarks, requiring plans to achieve 60% accuracy by July 1, 2025, and 80% accuracy by July 1, 2026, among other goals. Health plans would also be obligated to conduct annual verifications of provider directories to ensure accuracy.

AB 236 now goes to the State Senate for committee referral.