Understand the tradeoffs of a “narrow network” health insurance plan


In an effort to offer more affordable health plans, insurers have rolled out “narrow network” plans that may significantly restrict the choices of doctors and hospitals covered by the insurance and that limit out-of-network options. The result can be confusing for consumers who may be unaware of what they are buying and may have to change physicians or experience “surprise medical bills” for getting care out-of-network. These surprises are often intensified because insurers don’t maintain accurate directories of the providers covered by the plans. According to the Kaiser Family Foundation in 2018 73 percent of plans offered through the ACA exchanges were more restrictive HMOs or EPOs, up from 54 percent in 2015. Regulators are now stepping in: Mike Kreidler, Washington state’s insurance commissioner, fined one insurer  $1.5 million for failing to maintain an adequate network of doctors. But as noted healthcare economist Paul Ginsburg explains, “Narrow networks are a trade-off. They can be successful when done well. At a time when we need to find ways to control rising health care costs, narrow networks are one legitimate strategy.” When executed correctly, a narrow network is just the “right” network, carefully curated to deliver the best care at the most affordable price. But insurers seem incapable of using clinical evidence to select the right providers, or of using technology to surface in real-time who is in or out of network, leaving the consumer lost, and practically requiring regulators to intervene. The result is conflicted double talk defending open choice while lamenting rising costs. Here we have experience both clinically and with insurers and regulators and consumers: transparency of network through the use of simple technology revealing a carefully curated set of physicians, practices and hospitals can deliver great care, great experience and affordable prices. But regulators don’t support experimentation or novelty in this market. Until they do, the ultimate trend will likely be continued rising costs and generic experiences in the commercial market.

Read: Kaiser Health News: In Search Of Insurance Savings, Consumers Can Get Unwittingly Wedged Into Narrow-Network Plans

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