Beyond Broken Links: The High Stakes of Provider Directory Accuracy in the No Surprises Era

Inaccurate provider directories have long been a source of frustration for patients, providers, and payors alike. Today, in a regulatory environment shaped by the No Surprises Act (NSA), they’ve become something else entirely: a legal and financial liability.

The NSA, which took effect in 2022, was designed to protect patients from surprise bills when they receive care from out-of-network providers. One of its key provisions requires health plans to maintain accurate provider directories and to update them at least every 90 days. The law also mandates that payors remove unverified providers and reflect changes within two business days.

But nearly three years into implementation, mounting evidence shows that health plans are struggling to meet those requirements — and the cost of falling short is significant.

Persistent inaccuracies and patient risk

Recent data underscores how deeply rooted the problem is. A 2024 secret shopper study published in the American Journal of Managed Care (AJMC) recontacted 1,802 provider listings previously flagged as inaccurate across five carriers in Pennsylvania. After more than 500 days, more than 40% of those listings remained incorrect, and only 13% had been fully corrected.

This aligns with findings from a JAMA-published study that used AI to analyze provider directories across five national insurers. It found that 81% of physicians had inconsistencies in their listings, primarily around addresses and specialty designations.

Inaccuracies don’t just erode trust — they lead directly to surprise billing events, missed appointments, care delays, and in some cases, enforcement action.

Disputes are rising, and so are costs

The law’s Independent Dispute Resolution (IDR) process was designed to mediate payment conflicts between payors and providers when discrepancies occur. But the volume of these disputes has ballooned.

According to a 2023 CMS report, more than 650,000 IDR cases were filed in a single year — far exceeding expectations. Providers prevailed in the majority of these disputes, signaling not just volume but imbalance in the outcomes.

For payors, that translates into growing administrative workload, legal exposure, and financial outflows — all stemming from a problem that, on paper, should be solvable: directory accuracy.

Why is it still broken?

The reasons are both structural and operational. At its core, directory accuracy depends on regular, complete, and validated updates from thousands of providers — a process that is largely manual, inconsistent, and fragmented across systems.

Key challenges include the following.

• Multiple insurers per provider: Physicians often need to update multiple payors when changes occur, each with different update requirements. This often is a manual and cumbersome process requiring calling, emailing and sending letters.
  
• Group practice data reporting: Frequent movement of physicians in and out of practices results in challenges for group practices. Provider groups may fail to accurately update new provider locations or service information and sometimes neglect to update new locations or remove providers who have left the practice.
  
• Lack of provider data exchange standardization: No universal format or data-sharing mechanism exists between plans and providers resulting in the creation of multiple files being exchanged and resulting in errors when inputting and updating information. .
  
• Verification and provider data update lag: Internal processes can take weeks and in some cases months to reflect a change submitted by a provider.

The result is a system where errors persist — not due to negligence, but due to complexity.

Regulation without reinforcement?

Although the NSA outlines clear requirements — 90-day verification cycles, 48-hour update windows, and accuracy guarantees — enforcement mechanisms remain unclear. Carriers are expected to comply, but without standardized penalties or audits, many fall behind.

The CMS’s proposed national provider directory, currently under review, is one step toward systemic reform. But until it arrives, payors are left managing accuracy through their own workflows — and patients continue to bear the consequences.

Toward a more sustainable solution

Experts across the healthcare system agree: the current model is not sustainable.

Technological advances offer a potential path forward. Industry analysts have noted the rise of provider data management platforms that leverage automation, real-time verification, and centralized credential syncs to maintain cleaner, more accurate directories.

These systems reduce dependency on spreadsheets and manual email outreach by providing:

• A way for providers to take ownership of their data and easily make updates via self-service electronic portals.
• Utilizing PDM systems that are more intuitive and provide automated validation of address, specialty, and license data
• Centralized dashboards and data sources allowing payors to have the ability to better audit directories.
• Real-time API integrations with credentialing databases like NPPES, CAQH, and PECOS that pull in the most updated data and prevent manual errors and duplications
  

While these platforms are not yet the norm, they represent an emerging best practice — and a critical step toward reducing disputes, protecting members, and achieving compliance.

Conclusion

The No Surprises Act was a landmark effort to put patients first. But its success hinges on execution — and accurate provider directories are at the heart of that.

Today, the burden lies with payors. Whether they rely on legacy workflows or invest in more scalable solutions will determine not just compliance, but care access, provider trust, and financial outcomes.

The question is no longer whether directory accuracy matters. It’s how health plans are going to fix it.

Photo: porcorex, Getty Images

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