The American Psychiatric Association’s lawsuit against EmblemHealth over ghost networks is a proposed class action filed in late December 2025 in the U.S. District Court for the Southern District of New York, accusing the insurer of publishing mental health provider directories “replete with errors and duplications” that mislead patients and misuse clinicians’ names. The case, American Psychiatric Association et al. v. EmblemHealth, Inc. et al. (Case No. 1:25-cv-10783), targets EmblemHealth, Inc. and EmblemHealth Plan, Inc., which together cover roughly 1.5 million people through commercial, Medicaid, and New York City employee plans.1American Psychiatric Association. APA Class Action Complaint Against EmblemHealth2Behavioral Health Business. EmblemHealth Hit With Ghost Network Lawsuit
What the Complaint Alleges
The APA describes several categories of directory problems. EmblemHealth’s listings allegedly mislabel nurse practitioners as psychiatrists, include the same clinicians multiple times to pad the count, and list providers who never agreed to participate in the network or who do not practice at the locations shown. Many listed clinicians, the complaint says, do not actually accept EmblemHealth insurance at all.1American Psychiatric Association. APA Class Action Complaint Against EmblemHealth
The alleged effect on patients is straightforward. People searching for in-network mental health care either give up, delay treatment, or end up paying far more for out-of-network providers because the directory pointed them toward clinicians who were never really available. The complaint also alleges a distinct harm to clinicians: providers listed without their consent receive calls from patients seeking coverage they don’t accept, damaging their professional reputations.
The legal claims sit on both federal and state ground. The APA invokes the federal Lanham Act, asserting unfair competition, false affiliation, and false advertising. It adds state-law claims for deceptive business practices, violations of New York consumer protection statutes, and unjust enrichment.3Georgetown Law Litigation Tracker. American Psychiatric Association et al. v. EmblemHealth, Inc. et al. The plaintiffs seek class certification, monetary damages, and an injunction requiring EmblemHealth to fix its directories and stop the practices described in the complaint.2Behavioral Health Business. EmblemHealth Hit With Ghost Network Lawsuit
Who Is Suing
Two professional associations lead the case. The American Psychiatric Association represents psychiatrists nationwide, and the New York State Psychiatric Association represents psychiatrists practicing in the state. Both filed on behalf of their members, whose names and credentials have allegedly been used in EmblemHealth’s directories without authorization, and on behalf of a proposed class of affected patients and families.4New York State Psychiatric Association. NYSPA Homepage
Six individual plaintiffs bring the patient side: Milen Beyene, Valeria Calderon, Elizabeth Canty, Bonnie Doris Elliott, Daniel Riccobono, and Nimrod Shimrony. They allege they were misled by the directories, unable to find available in-network mental health care, or forced to delay or forgo treatment because of the inaccurate listings.1American Psychiatric Association. APA Class Action Complaint Against EmblemHealth
How EmblemHealth Is Fighting the Case
EmblemHealth moved quickly to try to end the case before discovery. On February 27, 2026, its attorneys filed a letter motion seeking leave to file a motion to dismiss. Their arguments run along three lines. First, the APA and NYSPA lack standing under the Lanham Act because they are not commercial competitors of EmblemHealth. Second, the claims are moot because the New York Attorney General’s separate settlement already addresses the directory problems. Third, a “reasonable consumer” would not be deceived given the disclaimers already in the provider directory.5Georgetown Law Litigation Tracker. Defendants’ Motion for Leave to File Motion to Dismiss
The court granted leave. EmblemHealth filed its formal motion to dismiss on April 3, 2026, the plaintiffs responded on May 26, and EmblemHealth replied on June 12. As of mid-June 2026, the motion is fully briefed and awaits a ruling.3Georgetown Law Litigation Tracker. American Psychiatric Association et al. v. EmblemHealth, Inc. et al. The court’s decision will determine whether the case moves toward discovery and class certification or is narrowed or dismissed.
How This Case Relates to the New York AG Settlement
The APA case is separate from, but tied to, an enforcement action by New York Attorney General Letitia James. On February 19, 2026, the AG announced a $2.5 million settlement with EmblemHealth resolving a state investigation into the same ghost network problems, launched in 2023.6New York Attorney General. Attorney General James Secures Sweeping Reforms Improving Access to Mental Health A “secret shopper” survey conducted during that investigation found that more than 80% of behavioral health providers EmblemHealth listed as accepting new patients were effectively unavailable, meaning unreachable, not in-network, or not taking new patients.7ProPublica. EmblemHealth Ghost Network Settlement Mental Health
The AG’s settlement, formalized as an Assurance of Discontinuance, requires EmblemHealth to correct inaccurate listings within two business days, verify provider information every 90 days, guarantee urgent mental health appointments within 24 hours and initial outpatient visits within 10 business days, cover care at in-network cost-sharing when patients cannot find timely in-network options or are misled into out-of-network billing, and submit to independent monitoring, including a restitution process for members who paid out-of-pocket because of directory errors. EmblemHealth stated it did “not admit” the AG’s findings and agreed to settle “to avoid time-consuming litigation.”7ProPublica. EmblemHealth Ghost Network Settlement Mental Health8Rise Health. EmblemHealth Agrees to Pay $2.5M for Ghost Networks
EmblemHealth argues that this settlement moots the APA’s case. The APA disagrees, and the mootness question is one of the issues before the court on the motion to dismiss.
Why the Directories Are the Way They Are
EmblemHealth does not manage its behavioral health network directly. That work is delegated to Carelon Behavioral Health, Inc. (formerly Beacon Health Options), which handles utilization management, credentialing, and the provider directory for EmblemHealth’s behavioral health programs.9EmblemHealth. Behavioral Health Services Members reach behavioral health care through Carelon’s contracted network, and providers must clear Carelon’s credentialing to see EmblemHealth members.
The AG’s 2026 investigation found internal confusion within EmblemHealth about which entity, EmblemHealth or Carelon, was responsible for monitoring the behavioral health network’s adequacy. The investigation also found that until 2025, EmblemHealth did not systematically remove behavioral health providers who failed to verify their directory information.10New York Attorney General. EmblemHealth Inc. Assurance of Discontinuance Internal audits showed that as of 2024, only 22% of behavioral health appointments could be successfully scheduled once unreachable providers were accounted for. Between 2019 and 2024, more than 6,400 listed behavioral health providers never filed a single behavioral health claim for an EmblemHealth member.
What a Ruling Here Could Mean
The APA is not the only party trying to use the courts against ghost networks, and one adjacent ruling could shape what happens to its case. In Doe v. Anthem HealthChoice Assurance, federal employees brought a ghost network suit in the same Southern District of New York. In March 2026, a judge dismissed all claims, holding that the Federal Employees Health Benefits Act preempted the plaintiffs’ state-law causes of action.11Justia. Doe et al v. Anthem Healthchoice Assurance, Inc. et al That case is now on appeal to the Second Circuit, and its resolution could affect how state consumer protection claims fare in later ghost network cases, potentially including aspects of the APA’s suit.
The broader enforcement backdrop helps explain why the APA chose to litigate. The No Surprises Act, effective for plan years starting January 1, 2022, requires health plans to verify directory information every 90 days, post updates within two business days, and cap patient cost-sharing at in-network rates when directory errors send patients to out-of-network providers.12CMS. No Surprises Act Disclosure and Continuity of Care Directories Training Enforcement has been thin. CMS has not issued formal implementing regulations and has imposed no federal fines for directory errors since the statute took effect. A ProPublica investigation found the New York Department of Financial Services had not fined any insurer for directory inaccuracies, and California’s Department of Managed Health Care had issued a total of $82,500 in directory-related fines since 2016.13ProPublica. Ghost Networks Health Insurance Regulators Against that gap, the APA’s suit is an attempt by a professional association to compel through litigation what regulators have not compelled through fines.