Beware patients (which means everyone!).
Only health insurers and employers who sponsor health insurance for their employees benefit from “narrow network” health plans. So, beware if you think paying a lower premium for a health plan with a narrow network is a good choice.
To understand a narrow network, it’s important to first understand how a provider network works. Basically, a provider network limits enrollees in a health plan to using a only those providers (doctors, hospitals, labs, and treatment centers etc.) with whom the health insurer has negotiated a payment rate. In a narrow network, enrollees are limited to even fewer providers - typically only 10% to 25% of the doctors in a geographic area.
The problems with narrow networks are many, including:
Fewer providers mean less available medical care. Think about it this way: each doctor, hospital, lab or treatment center can only provide care to a certain number of patients. That means that when you call for an appointment or need to be admitted to a hospital, there are a limited number of spots available to you. And that delays the care you can get—if you can get any at all. As an expert once gave the following analogy to a jury: Imagine showing up to see a ball game and only one out of every four gates to enter the stadium is open. Sure, you’ll get in, but you’re going to be delayed, and by the time you get in, the game could be over.
Narrow networks also mean you might have a longer drive to find an in-network provider. This is especially true for those who live in rural areas or need a specialist. Imagine having to make a two-hour round trip to see a doctor, and that doesn’t even include the waiting time or doctor’s visit itself.
Somewhat related is that provider directories are not always accurate. Insurers will include in their directory, doctors or facilities that are not actually in their network. This happens sometime because directories are not updated, but other times, insurers intentionally mislead and include out-of-network providers, because they are trying to sell a particular plan and want patients to believe the plan has more providers than it really does.
Most concerning (and probably the least known downfall) is that health insurers use narrow networks to manage costs, which translates to insurers only allowing those providers in-network whose economic profiles financially benefit the insurer – e.g., they order fewer diagnostic tests and/or less expensive treatments. Overall the providers may be providing the least costly care (for the insurer), but that does not mean the best health care for patients.
“Economic profiling” is the subject of another Barta-Law blog post.