Narrow Networks in Exchanges

[Yagents]

If there was any doubt about narrow networks in exchanges, it seems insurance companies and hospitals are negotiating lower rates behind the scenes to do just that.

Hospitals Forge New Deals With Insurers - WSJ.com

The upshot: Many plans sold on the exchanges will include smaller choices of health-care providers in an effort to bring down premiums.
To keep costs low, the insurers are pressing for hospitals to grant discounts from the rates hospitals usually get in commercial plans. In return, participating hospitals would be part of smaller networks of providers. Hospitals will be paid less by the insurer, but will likely get more patients because those people will have fewer choices. The bet is that many consumers will be willing to accept these narrower networks because it will help keep premiums down

 

[somarco]

Hospitals will be paid less by the insurer, but will likely get more patients because those people will have fewer choices. The bet is that many consumers will be willing to accept these narrower networks because it will help keep premiums down

And the ones they get via the exchange will generally be sicker, more expensive to treat. Many will still continue to use the ER as their PCP.

Not much changes except more volume.

Most who buy through HIX will be low income, qualifying for Medicaid or highly subsidized plans. It won't matter to them if it has a narrow network and fewer meds on the formulary but it does matter that they won't have to pay much for the coverage.

My guess is it will be mostly the hospitals that "cater" to Medicaid pts that will opt to join the HIX network plans.

 

[Ann H]

I agree with both of you about these narrow networks, and the exchange business that gravitates towards it.

But.... it will not just be narrow network. The exchange plans will have ACO contracts. Here comes the 80's all over again, with HMO-look-alike plans. We will see gatekeeper PCP, referrals to specialists, and pre-certs for everything. It will just be processed through one organization, rather than through independent providers. So, it is really like the staff-model HMO (think Kaiser or Cigna's old clinic-HMO). The ACA created the ACO's to have bonuses for keeping people well, and handling medical case-management efficiently (insert gasp here). And, one more thing - it will have restrictive Rx formularies.

 

[Dave020]

Should we take bets on whether or not Blue PPO plans sold inside of an exchange will have BlueCard access? I am betting that they won't.

 

[pahealthquotes]

If there was any doubt about narrow networks in exchanges, it seems insurance companies and hospitals are negotiating lower rates behind the scenes to do just that.

Hospitals Forge New Deals With Insurers - WSJ.com

The upshot: Many plans sold on the exchanges will include smaller choices of health-care providers in an effort to bring down premiums.
To keep costs low, the insurers are pressing for hospitals to grant discounts from the rates hospitals usually get in commercial plans. In return, participating hospitals would be part of smaller networks of providers. Hospitals will be paid less by the insurer, but will likely get more patients because those people will have fewer choices. The bet is that many consumers will be willing to accept these narrower networks because it will help keep premiums down

In Pa , Big Insurance co's Like Highmark BCBS, Geisinger and UPMC are buying hospitals and large medical practices left and right. The big fish eats the lil fish.

Cheers

 

[somarco]

Here comes the 80's all over again, with HMO-look-alike plans.

With GI and adverse selection, that is about the only way the carriers can limit their losses.

Elections have consequences.

 

[stuy119]

Interesting article that re-hashes much of this line of thinking from Scott Gottlieb, who previously worked at CMS (and likely still has contacts there to get the inside scoop):

RealClearMarkets - Obamacare Insurance Plans Will Be Bare Bones -- And Expensive

 

[AllenChicago]

Stuy119, that was a good, thought-provoking analysis from Dr. Gottlieb. It's becoming clearer to me what "narrower networks" mean. I think the (now defunct) PCIP only reimbursed doctors at the Medicaid rate. Is this what makes the network "skinny"...the fact that few experienced physicians are willing to participate in it?
Millions of new patients in waiting lines to see new physicians who were rushed through medical schools to meet the demand. Conjures up all sorts of horror stories doesn't it?

At first, health insurers and physicians thought Obamacare was going to be a financial gold-mine. It now appears that both will be screwed by the Affordable Care Act. Perhaps Dentists are on the shrinking list of entities who will actually benefit from this legislation.
-ac

 

[stuy119]

Allen, if that's the case, we're going to see a surge in malpractice lawsuits as well. On the back end, I'm curious to see what this does to medical malpractice insurance and what further disturbances that causes.

 

[AllenChicago]

Sorry Stuy119, I was wrong about something... It's not new PHYSICIANS who will be receiving the millions of additional patients... it's newly graduated PHYSICIAN ASSISTANTS.

Quote from: What the Affordable Care Act Means for Physician Assistants
"Unlike Physicians, Physician assistants, do not do residencies. They graduate from PA school and go to straight to work. Their education is far less expensive. Although there is a nearly 20-year-long projected shortage of physician assistants, the rate at which new PAs are being licensed is increasing annually, as new PA programs are established. Even better, the new health care reform law provides money for new physician assistant training programs. The end result? PAs are in a much better position than doctors to fill the health care gap."

Are P.A.'s sued for malpractice often?

-Allen