Health Plan Narrow Networks: Highlighting Transparency Deficiencies for Consumers

A recent conference hosted by the Robert Wood Johnson Foundation provided a timely forum to discuss the transparency and informational challenges brought about by emerging narrow provider networks in the health insurance marketplaces. The National Summit on Health Care Price, Cost and Quality Transparency took place over 3 days here in Washington, DC to highlight ideas, challenges and best practices geared towards making our health care system more transparent. One panel discussion, of which I was a part, focused particularly on transparency within narrow provider networks.

Our panel was moderated by Kathy Hempstead of the Robert Wood Johnson Foundation and joined by representatives from a health plan (Lori Nelson of Blue Cross Blue Shield of Minnesota), a provider (Michael Boninger of UPMC in Pennsylvania), a state regulator (Dan Schwartzer, deputy Wisconsin insurance commissioner), and a federal official (Richard Kronick of the Agency for Health Care Quality and Research). Very quickly we honed in on the fact that the Affordable Care Act (ACA) has brought about a sea change in how consumers shop for and select health plans. It has also shone a spotlight on the significant deficiencies in the information consumers have and the way in which the information is conveyed.

Panelists had differing views, however, on how consumers could best obtain information about health plan networks. Dan Schwartzer, the state insurance regulator, felt that consumers would be best served by using insurance agents or brokers to help them understand their options. Others, including me, asserted that insurers and the marketplaces have an obligation to provide consumers with easy-to-understand, accurate and actionable information so that they can shop on their own. We also noted that not all consumers are looking for the same thing when it comes to their plan networks. Some simply want to know whether a particular doctor or hospital is in their network. Others don’t have a preference for a particular provider, but do want to know that if they get sick down the road, they’ll have a broad network with relatively unrestricted choices among providers. Unfortunately, on today’s marketplaces it is not easy for consumers to make informed shopping decisions among plans. Provider directories are notoriously out-of-date and inaccurate. And as insurers have narrowed their networks, the old familiar labels – HMO and PPO – to denote a “narrow” vs. “broad” network don’t mean what they used to.

Panelists – and the audience – debated the extent to which the government should step in to address this issue. While some argued that we should just “let the market work,” others (including me) felt that government plays an important role in setting a clear network standard, making sure consumers have the information they need, and holding health plans accountable. At the same time, there are public-private partnerships developing that could lead to innovations in information transparency and consumer decision support. For example, the Robert Wood Johnson Foundation and the U.S. Department of Health & Human Services (HHS) have recently teamed up on a “Provider Network Challenge,” which asks developers and designers to submit innovative apps or tools that will allow consumers to determine the best plan network for their health care needs. The winner of the challenge will receive a $50,000 prize and the opportunity to work with the Foundation and HHS to develop the tool with real time data.

Panelists and many in the audience agreed that narrow networks are not bad for consumers. In fact, narrow networks can not only deliver consumers lower up-front prices, they can also allow a plan to better manage the quality and delivery of care to better meet the needs of enrollees, particularly those with chronic conditions. However, consumers do need to be able to make informed choices when selecting a plan and care provider – and we need to develop and deploy the tools for them to do so.

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