Most health systems and health plans know their provider data is unreliable, but most cannot fix it. New research commissioned by Verato, an identity intelligence company, and conducted independently by Sage Growth Partners in Q2 2026, documents both facts - nearly all health plans encounter provider data errors at least monthly, yet fewer than one in three health systems have a single verified source of truth for that data.
The errors are operational. The report describes duplicate records, outdated provider locations, practitioners listed as active who are no longer in a network, and inconsistent specialty information. These are the same data points that drive member complaints, out-of-network billing surprises, and claims rework. When an employer's plan members try to find in-network care using a health plan's directory and that directory is wrong, the cost lands on the employer in the form of excess claims, member disputes, and plan administration friction.
Sage Growth Partners surveyed 101 health system leaders and 50 health plan leaders, 77 percent, and 72 percent of whom hold vice president-level positions or above. Every health system participant works for an organization earning at least $1 billion in annual net patient revenue. Fifty-eight percent of health plan participants cover one million or more lives. The research was double-blinded, meaning participants did not know who commissioned it, and Verato does not know who responded.
The findings are unambiguous. Eighty-five percent of health systems and 78 percent of health plans say achieving their top strategic priorities will require accurate, timely, and accessible provider data. Yet only 12 percent of both groups rate their data quality as excellent, and only 28 percent of health systems and 36 percent of health plans have a fully implemented single source of truth for provider data. Ninety-two percent of health systems and 98 percent of health plans encounter data inaccuracies at least monthly, often several times a week.
The report's answer to why provider data has stayed broken despite years of effort is structural. Healthcare organizations do not have a trusted source of truth that flows automatically to every system that needs provider information. Different departments build their own tools, which means every fix is a point solution inside one siloed system. The data fragments again the moment it leaves that system.
Provider data is scattered across provider directories, electronic health records, ERP systems, CRM platforms, and claims administration systems, requiring constant manual review to stay current. Manual processes cascade into administrative waste across credentialing verification, panel reconciliation, and claims rework.
The consequence runs deeper than operational inefficiency. Seventy-eight percent of health systems and 70 percent of health plans rank AI as the top technology area their organizations will invest in over the next one to three years. Those AI investments depend on provider data that the same leaders already acknowledge is unreliable. Fewer than half of health systems say they use data effectively for revenue cycle management, and fewer than half of health plans say they do so for claims adjudication. Those are the core workflows AI is being deployed to improve.
"Provider data is the foundation of almost all strategic bets a health system or health plan makes," said Jason Bihun, president of commercial operations at Verato. "Network growth plans, claims processing, and revenue cycle workflows, with and without AI, run on that same data. Get it wrong, and each process inherits the error."
The AI readiness problem in health plans is not new. The Verato report's findings reinforce a pattern documented in other recent research. A summer 2026 survey of 70 payer and provider executives by Cotiviti and MedCity News found that 97 percent of health plans are already piloting or actively using AI, but fewer than 40 percent have detailed policies governing how employees use it. That governance gap extends directly into the AI tools health plans deploy for claims, prior authorization, and member data management.
The path forward the report describes is sequential. Resolving fragmented records into a single accurate provider identity comes first. Without it, every downstream analytic or AI application inherits the same fragmentation.
Keeping core attributes current against trusted external sources comes second. A resolved identity decays quickly if locations, phone numbers, and specialties are not refreshed continuously. Only then can organizations layer in the network-level dimensions that turn provider data into strategy, including clinical activity, referral patterns, compliance records, and health plan relationships.
That three-step sequence is what separates a durable data foundation from another point solution. Ninety-five percent of health systems and 96 percent of health plans believe implementing better data management technology could let them retire at least one existing system. Roughly half say they could retire three to five.
