What to Do When You Fail a Network Adequacy Review

The First 48 Hours After a Deficiency Notice

When a network adequacy deficiency notice arrives — from CMS for an MA or QHP filing, or from a state Medicaid agency for a managed care contract — the temptation is to immediately escalate to legal and executive leadership and begin drafting a response. Resist that temptation for 48 hours. The first priority is understanding exactly what failed before you respond to anything.

Read the deficiency notice carefully and produce a structured summary that answers: which counties failed, which specialty categories failed in each county, whether the failure is a data error (your submission was wrong) or a genuine network gap (you don't have the providers), and what the cure deadline is. Most deficiency notices give plans 30-45 days to respond; some give 15 days for certain types of deficiencies. Knowing the timeline is critical before you can plan the response.

The structured summary becomes the working document for your response strategy. Distribute it to the network ops team, legal, and compliance leadership with a clear read-the-document expectation before the first response planning meeting. Walking into that meeting without everyone having read the actual notice is a waste of everyone's time.

Reading the Deficiency Notice: What It's Actually Telling You

Deficiency notices come in two fundamentally different types, and your response strategy differs significantly between them:

• Data deficiencies: Your submission had errors — wrong specialty mapping, stale NPI data, calculation errors, or missing documentation. The actual network may be adequate; the filing didn't accurately represent it. These are the fastest to cure: you correct the data and resubmit with documentation demonstrating the error was in the filing, not the network.
• Genuine network gaps: Your network is actually deficient in the identified counties and specialties. These require either emergency provider recruitment, telehealth waiver requests, or a corrective action plan with a timeline for filling the gap.

Many deficiency notices involve a mix of both types. Identify which deficiencies are data corrections versus genuine gaps in your 48-hour analysis. Cure the data deficiencies immediately in your response — don't concede a data error as a genuine gap, because that concession affects how the regulator views the severity of your overall filing.

Prioritizing Gaps for Emergency Recruitment

For genuine network gaps, your response must include a concrete remediation plan. Prioritize gaps in this order for emergency recruitment:

• Urban and suburban counties where the provider supply is available but you didn't contract successfully — these are the most tractable because the providers exist
• Specialty categories where you have providers in adjacent counties who might be willing to extend their service area with travel arrangements or telehealth
• Counties where an FQHC or large group practice that you haven't yet contracted with could solve multiple specialty gaps in a single contract
• Rural counties where structural supply constraints make emergency recruitment very difficult — these are the exception filing candidates

Emergency contracting timelines are compressed: aim for LOI within 10 days of the deficiency notice, executed contract within 20 days, credentialing application submitted within 25 days. You are unlikely to credential and effective-date a provider within a 30-day response window, but you can demonstrate an executed contract and active credentialing — which gives you a credible remediation timeline to include in your response.

Telehealth Waiver Requests

For specialty categories where CMS has codified telehealth as an acceptable modality — behavioral health, and certain primary care contexts — a telehealth waiver request can address gaps that emergency contracting cannot cure in the response window. The waiver request must include:

• A contracted telehealth provider who is actively delivering services in the specialty category (not just a proposed telehealth arrangement — you need an executed contract)
• Documentation that the telehealth provider can serve members in the deficient county (state licensure, technology access)
• A member communication plan describing how members in the county will access telehealth services
• Appointment availability confirmation — CMS reviewers want to see that telehealth access is real, not theoretical

Documenting Good-Faith Efforts

For genuine gaps in counties where you cannot cure the deficiency within the response window, your corrective action plan needs to demonstrate good-faith efforts to fill the gap. This documentation should include: a complete outreach log from the original build (dates, contacts, methods, outcomes), evidence of emergency outreach initiated after the deficiency notice (at least three contacts per available provider within the deficiency window), and a structural supply analysis showing that the provider supply in the county is genuinely insufficient to meet threshold.

Good-faith documentation does not guarantee approval of the CAP, but it significantly reduces the probability of escalated enforcement action. CMS reviewers distinguish between plans that have demonstrably tried and failed to fill a structural gap versus plans that didn't try hard enough. The difference affects both the outcome of the current review and the scrutiny applied to future filings.

Structuring Your Response to the Regulator

Your formal response should be organized around the structure of the deficiency notice itself: address each deficiency finding individually, in order, with a clear statement of: (1) whether you are curing the deficiency with corrected data, an executed provider contract, or a corrective action plan; (2) the specific action taken or committed to; and (3) the timeline for full cure where the deficiency cannot be immediately resolved.

Include all supporting documentation as labeled exhibits that correspond to the deficiency findings. Reviewers who have to hunt through unorganized documentation produce worse outcomes for plans than reviewers who can quickly verify each assertion in the response. Clarity and organization signal organizational competence and reduce the probability that a correctable deficiency escalates to an enforcement action.