Narrow networks are a reality of the new health insurance landscape. Nearly half of all insurance plans sold on the public exchanges in 2014 were narrow network plans, defined as those with less than 70% of area hospitals included, according to an analysis
by the research firm McKinsey & Company.
But given that reality, insurers and providers need to do a better job of providing consumers with accessible, easily understandable information about networks when they shop for coverage. That was the message conveyed by participants in a panel discussion about network adequacy on Monday in Washington sponsored by the Alliance for Health Reform
Provider networks have been a hot button issue since the exchanges launched last October. In many states, concerns about the exclusion
of highly regarded hospitals have garnered headlines, and the CMS has signaled
that it plans to heighten scrutiny of provider networks going forward. A class-action lawsuit filed earlier this month
in California against Anthem Blue Cross accuses the insurer of misleading millions of individuals about whether their doctors and hospitals were covered by exchange plans.
Paul Ginsburg, a healthcare finance expert at the University of Southern California, pointed out that narrow-network plans are not a new phenomenon and that they are a potentially important means of reducing overall healthcare costs. “There clearly is a need for regulation, but there is a very high cost if the regulation goes too far,” he said. Ginsburg singled out “any willing provider” laws, which many states adopted in the mid-90s, when anger over narrow networks first became pitched, as a “particularly misguided” effort to curtail problems.
Insurers carefully assembled the networks capable of delivering high-quality care to consumers whose top concern is price, said Daniel Durham, executive vice president for policy and regulatory affairs at the trade group America's Health Insurance Plans
. “If we just open up to everyone,” Durham said, “we're stuck back in this fee-for-volume-type system which we all agree we have to move away from.”
Katherine Arbuckle, Ascension Health's chief financial officer, said better consumer education about provider networks, particularly by insurers, is paramount. She pointed out that the not-for-profit hospital chain used 200 employees to help individuals navigate the exchanges and obtain coverage. “What we've learned is this counseling takes a lot of time,” Arbuckle said. “This is especially important with these folks who don't have experience with insurance
and have cultural and language barriers as well.”
The National Association of Insurance Commissioners is currently reviewing its model network adequacy law, which hasn't been updated since 1996. According to Brian Webb, the association's manager of health policy and legislation, the revised legislation is expected to be released in November. Webb indicated that it will provide a broad framework to help guide states, rather than detailed policy prescriptions.
“We don't think that will work,” Webb said. “Wyoming is just a tad different from Los Angeles.”
People living near state borders sometimes ran into particularly irritating problems with networks, Webb said. In some instances, the plans provided no coverage if a person sought treatment in a neighboring state.
“We've got to do better in the 2015 open enrollment period,” Webb said. “We need to make sure everybody has the information they need.”Follow Paul Demko on Twitter: @MHpdemko