The old marketing phrase “one size fits all” has fallen on hard times. Whether shopping for smartphones or sweaters, consumers want their choices.
That’s true even for health insurance. Partly in response to the Affordable Care Act, health insurers are offering consumers more plans to choose from, including plans that keep premiums lower by limiting the number of doctors and hospitals that participate in the network.
These so-called narrow networks, or value networks, lie at the heart of a current debate over whether patients can visit the physician or hospital they know best and still have their medical visits covered.
The concept of value networks is simple enough: Instead of allowing every hospital and physician to be “in network,” health plans strike deals with the ones that have proven their ability to keep medical costs down and quality up. If the health plan’s members go outside this network, they pay more.
Health policy experts believe that over time, value networks should help keep health care costs in check while still offering consumers quality care. In fact, many of the highest-priced hospitals don’t necessarily score better in objective quality measures such as postsurgical mortality rates, according to a study published in January in the journal Health Affairs.
“Better value occurs when there’s better alignment between a plan and a relatively tight network,” Dr. Jeff Rideout, senior medical adviser for California’s health exchange, told Time magazine.
Many health insurers — in an effort to make sure their products were affordable — developed plans with value networks to offer on the Affordable Care Act exchanges. Insurers relied on consumer research showing that people new to health insurance were most interested in access to care at affordable prices. Meanwhile, existing customers place a greater value on retaining their current providers.
A survey released last week by the Kaiser Family Foundation backed up insurers’ research. By a margin of 54 percent to 35 percent, consumers who either purchase as individuals or are uninsured would opt for a lower-cost, narrower network of doctors and hospitals. The percentages are essentially reversed among consumers currently insured through an employer: 55 percent said they’d prefer a broad network, while just 34 percent would opt for narrow.
The solution for insurers? Offer both.
Choices in North Carolina
Blue Cross and Blue Shield of North Carolina offers a full range of networks and pricing for the exchange in North Carolina. The spectrum ranges from the full-network Blue Advantage product to the limited-network Blue Value plans. Premiums for Blue Value, which is offered only in certain geographic markets in the state, are as much as 9 percent below the rates for Blue Advantage.
An in-between option is Blue Select, which is a “tiered” benefit product: The first level of network providers, who meet the highest levels of quality and cost efficiency, comes with lower out-of-pocket costs than the second level, which is still in network.
These same products exist outside the exchange, allowing consumers to decide whether they want a limited network at a lower price or a broad network.
Consumers have a lot to consider when shopping for coverage. Even within the same “metallic” levels on the exchange, plans can be structured differently, resulting in different coverage and value. Some plans with lower premiums might also include higher copayments for visiting specialists or higher out-of-pocket costs before prescription coverage kicks in. And some plans might even require referrals to see specialists. Generally speaking, BCBSNC plans don’t include such a requirement.
Bruce Allen, BCBSNC director of marketing, says not all value-based networks are created equal.
“Our narrow network is bigger than most,” he says. “We made a strategic decision to avoid going too narrow.”
The key for consumers is to consider not only monthly premiums, but also deductibles, copays and out-of-pocket expenses before making a decision on coverage. If it’s not clear what those costs are, call the insurers you’re considering before signing up.
It’s equally important to check to see if the doctors and hospitals you prefer are in network. Nobody likes a surprise bill showing up from an out-of-network provider. BCBSNC customers may check the “Find a Doctor” tab on the company’s website to determine which doctors and facilities are in network.