Network Adequacy

Network adequacy is the regulatory standard that requires health plans to have enough contracted providers, in the right specialties, within reasonable travel distance, to actually deliver the covered benefits. States regulate network adequacy for fully-insured plans; CMS regulates it for Medicare Advantage and marketplace plans. Self-funded ERISA plans are largely exempt from state adequacy rules.

The standards are typically expressed as time-and-distance requirements — a primary care physician within 30 minutes and 15 miles of every member, a cardiologist within 60 minutes and 30 miles, a hospital within 30 minutes and 15 miles in urban areas. Wait times are also measured: routine appointments within 10 business days for primary care, 15 business days for specialists in most jurisdictions. Where this cracks: mental health, autism services, and specific subspecialties (pediatric endocrinology, complex spine surgery) frequently fail adequacy tests even on plans that meet the general standard, forcing members out-of-network or into long waits. Plans that fail adequacy reviews can be required to expand the network, allow network gap exceptions at in-network cost, or pay penalties.

The takeaway: if you can't get an in-network appointment for a covered service within a reasonable timeframe, request a network gap exception in writing. The plan may be legally required to cover an out-of-network provider at in-network cost-sharing.