With health plans increasingly cutting back on their networks -- both to scale down for ACA plans and save money generally -- providers are a bit fearful of what's next.
To get an idea of how this narrowing of networks is likely to play out, HealthcareDive spoke to Catherine Sreckovich, Managing Director in the healthcare practice of business consulting firm Navigant. Here are the highlights from our conversation.
How common are narrow networks today?
We're seeing a much stronger move towards narrow networks. We're seeing now networks based not just on cost but on quality and other analytics available to them. I would say that a quarter of the plans that are offered are now in narrow networks. And if you look at the exchange offerings the number is even higher; it's probably 70% of plans. That's pretty much the only way they can reduce price, since they don't have a lot of choices in benefit design.
Whose definition of quality is dictating how providers get chosen for networks?
Over the last several years, health plans and others have really spent considerable effort in developing the data analytics that help them develop cost and quality measures. There's a host of different accessible measures they can use to evaluate quality, including information based on surveys. Consumers can report how they feel about the quality that they feel they've received. Others are based on published measures such as length of stay and readmissions to hospitals, or occurrences that could have been prevented in hospitals.
Isn't there going to be a consumer backlash against narrowing of networks?
What is interesting is that surveys that have been done by health plans and others across the country, and based on experiences in Massachusetts where everybody has to buy insurance, when consumers are faced with the choice between the provider they think they want and lower cost, they always pick lower cost. The challenge is that they want to if they want to go to a hospital which is out of network; they can still do it, but it is going to cost them a lot more. The consumer is going to be faced with more out-of-pocket costs and the providers have to try to collect the additional costs.
How should plans manage consumer expectations?
There will have to be a good education program to inform people about networks available to them and why a particular network has been selected. And that will start to take a look at accountable care organizations and other entities becoming part of the network. We really see them beginning to work with the family doctors, specialists, and in hospital systems. Everybody works together to try to coordinate the care and I think that will make it easier for patients to understand how this benefits them.