Narrow networks are health plans that offer their subscribers a limited choice in health care providers. Health plans contract with a select group of doctors, specialists and hospitals, making those entities considered the in-network.
Because all plan participants are directed toward certain facilities and physicians, these providers can then reduce the cost for each visit and service – operating under the idea of buying in bulk. This results in lower premiums for the consumer and cost savings for insurers.
Benefits of Narrow Networks:
- Lower premiums
- Lower costs – such as employers directing employees to providers in a lower range
- Improve the heath care relationship – doctors in-network may use the same electronic medical record system allowing coordination of sharing medical info among health care providers
- Greater consumer awareness – allows employees to better understand and budget for their health care expenses
Disadvantages of Narrow Networks:
- Possible restricted access – restrictions and finding new health care providers who aren’t in the narrow network
- Surprise out of network bills – many hospitals contract out for emergency physicians, radiologists, and anesthesiologists. So while the hospital may be in-network, the doctors performing a certain surgery may not be, resulting in huge out of network bills
- Rural care – many times there are not enough in-network providers in the area resulting in long wait times or long distances
Educating employees about narrow networks is imperative. Provider listings must be kept up to date and employees should have easy access to this information. Transparency about access and costs is key, since failing to provide accurate information could result in surprise out of network bills.
An alternative to narrow networks is a hybrid option which takes the selective ideas from narrow networks but broadens it, so users have a choice between which provider-tier they want to work with. Members still have the flexibility to choose any provider but they may pay more out of pocket costs when they do not seek care from quality and cost effective doctors.
For further information on narrow networks and the hybrid alternative, contact your knowledge broker.