Is Your Health Plan’s Network a Mirage?
When hospitals stretch the truth, employers and their employees pay the price.
Your health plan may look solid on paper.
Hundreds of doctors. Major hospitals. Dozens of specialties.
But how many of those “in-network” providers can your employees realistically see?
For many employers, the answer is fewer than they think. In today’s healthcare market, insurers often design narrow networks that promise lower costs — and hospitals, eager to maintain patient volume, agree to restrictive terms. The result can be an illusion of access: networks that look broad on paper but, in reality, leave employees with limited options and long wait times.
The illusion of coverage
Imagine a hospital system in Denver claiming to offer cardiology and neurology services in Longmont or Fort Collins. Those clinics appear in directories, and the insurer marks the network as “adequate.”
But here’s the catch: those “local” specialists may only visit once a month, or not at all.
That’s enough for the insurer to declare geographic coverage and for the hospital to secure inclusion in a narrow-network contract. Both sides benefit: insurers get discounted rates and hospitals gain patient flow.
Employers and employees, however, lose. Workers may wait weeks for care, travel farther than necessary, and see the promise of their plan fall short.
Anti-competitive and potentially fraudulent
This practice borders on monopolistic behavior. It’s sleazy and it may also be legally questionable.
For example, in my home state of Colorado, the state’s regulatory framework relies heavily on qualitative standards for network adequacy, things like geographic distribution and appointment wait times. But enforcement is reactive, triggered by consumer complaints rather than proactive audits.
The Colorado Division of Insurance has begun collecting baseline data on provider networks, but without quantitative standards like minimum provider-to-enrollee ratios or drive-time limits, there’s little to prevent systems from gaming the system. The lack of transparency makes it difficult for employers to verify whether listed providers are truly accessible.
Why it matters to employers
When employees can’t access care easily, they delay treatment. Delayed treatment leads to higher costs, sicker workers, and lower productivity.
Worse, you’re locked in. Even when nearby providers have open schedules or better outcomes, exclusive contracts prevent you from adding them to your network. You’re stuck with what you negotiated. You’ve traded flexibility for a discount, and your employees pay the price.
The illusion of network adequacy isn’t just an insurance problem or a hospital problem—it’s a threat to your bottom line and your people. You’re the one footing the bill and facing retention hits when employees can’t get care. But here’s the good news: you also have the power to demand better.
What employers can do
Audit your network (this month)
Don’t trust provider directories. Verify that listed doctors are actively seeing patients in the claimed locations. Ask your Third-Party Administrator (TPA) or carrier for appointment availability and utilization data.Demand transparency (at your next renewal)
Require cost and quality reporting from your insurer. Many states have rules or laws such as Colorado’s HB25-1174 which mandates that carriers provide this information upon request, even for small group plans.Avoid exclusivity traps (before you sign)
Be cautious with contracts that restrict your ability to work with other providers. They may save you pennies today but cost you dollars tomorrow in limited access and inflated claims.Educate your employees (this quarter)
Help them understand where to seek care and how to verify in-network providers. Misrepresentation can lead to surprise bills, delayed care, and frustration.
Report bad behavior (when you spot it)
If you suspect a hospital system is misrepresenting its network, file a complaint with your state Department of Insurance. In cases of fraud, legal action under the False Claims Act may be warranted.
The bottom line
Network adequacy is more than a compliance metric; it’s a measure of how well you’re taking care of your people.
Employers must move beyond surface-level assurances and take an active role in verifying the integrity of their health plans.
In a system where hospital networks and insurers often prioritize market share over patient access, vigilance is essential. Don’t assume your plan’s reach equals real access. The fine print on your provider list may be costing you far more than you think.
Your employees trust you to choose a plan that works. Make sure it actually does.