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Obamacare's next big hurdle: Narrow provider networks


When the Affordable Care Act became law, insurers knew their health plans would have to compete side-by-side for the first time on state and federal healthcare exchanges. They wanted to put their best foot forward. By creating very limited networks of doctors and hospitals, they were able to price their health plans more aggressively. But in narrowing patients' heatlhcare choices, did they go too far?

Some say yes. The new plans don’t even start offering coverage until January 1, but already they're being challenged by insurance regulators, and one case has sparked a high profile law suit, Kaiser Health News reports.   

The pushback against narrow provider networks recalls the backlash against managed care and health maintenance organizations in the 1990s, says KHN. Back then, protests from consumers and hospitals wore down the efforts to rein in costs by limiting the provider network.   

Now consumers -- and excluded providers -- are raising their voices again as they realize that, despite President Barack Obama’s pledge that they could keep their doctors, their insurance company's health plan may not include the physicians or hospitals they’ve been seeing, 

While it's easy and politically convenient to point the finger at the ACA, a health plan's provider network is created at the discretion of a carrier to achieve lower costs and higher profit margins. State insurance regulators review these networks, just as they do premium prices. 

Done correctly, limited networks can save money because family doctors, specialists and hospitals who are all part of the same network do a better job of coordinating care, many health policy experts  But in extreme cases, it can delay treatments for the sick, require people without cars to travel long distances, or force patients battling diseases like cancer to pay exorbitantly to seek needed care out of network. 

In early Oct., a Miami Beach insurance agent who attended a briefings about the ACA-compliant health plans that would be available on the healthcare marketplace said "people gasped" when a carrier revealed that its provider network included only three hospitals in all of Miami-Dade.

It's too soon to tell what impact if any the narrower networks will have. But regulators and elected officials in a few states have already forced changes to their networks, reports KHN.

Maine's insurance regulator prevented Anthem BlueCross BlueShield from switching some customers to a network that excluded six of the state’s hospitals. Washington State's insurance commissioner initially banned some health plans for having "inadequate" provider networks, resulting in some of them being expanded. In New Hampshire, lawmakers have written legislation to require carriers to increase provider choice, perhaps moved by complaints from excluded providers. 

In Florida, the ACA-compliant networks were not reviewed either for price or for provider network by the

Florida Agency for Health Care Administration (AHCA), other than for informational purposes. The stated reason for that is that the insurance companies' networks were established and reviewed in years prior and therefore aren't considered new.

But a reduction of providers could be so sizeable as to have unwanted effects. In that case, a consumer complaint will trigger a review of any HMO not meeting the requirements for provider networks under Florida statute, an AHCA spokeswoman said. 




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