Two Minute Blog

Health Plan Consumers Sound Off on Narrow Networks: Docs Drive the Bus

More on the topic of narrow networks…

In a recent Kaiser Family Foundation survey of health plan buyers,  a little over half (51 percent) of those responding pointed toward buying a plan that cost more but presented a greater selection of providers vs. buying a less expensive plan with fewer participating doctors and hospitals (37 percent). However, the scales were tipped a little in the other direction for those previously without health coverage who were buying insurance for the first time as well as some would-be purchasers who were already enrolled in individual plans. Interestingly, the survey also reported that when push came to shove, many of those same folks (more than 1/3) who leaned in the narrow network / lower cost direction, when confronted with the possibility of losing access to their regular or preferred doctor and/or hospital, changed their tune preferring greater choice and access despite the higher cost.

A 2013 Deloitte Health Care Consumer Survey found that the majority of consumers would not consider a network that did not include their primary care doc. 12 percent of respondents were willing to swap physician relationship with price. More were willing to accept fewer in-network hospitals to lower their costs as long as their preferred docs were in the network.

For more on this topic, read Kaiser Health Tracking Poll: February 2014 and also Deloitte Survey of U.S. Health Care Consumers

What’s Happening With The Exchange? Opines Are Abundant

The news forums are buzzing with commentary about the new health care exchange. You don’t have to look very hard to find a wide range of opinions. For your reading pleasure, here’s a small collection of industry experts opining about what’s happening with the new exchange…

Joe Paduda’s Managed Care Matters: Exchange enrollment – the big picture

An insurance industry veteran, Joe’s commentary is always witty, amusing and timely. The funny thing is, he’s really good at breaking down double speak language, regardless of the specific topic at hand. In this recent post, he discusses the current state of enrollment on the new exchange and offers four current stories of not-so-happy exchange customers.

Julie Rovner for Shots – Health News from NPR: State Insurance Exchanges Still a Mixed Bag

Rovner, according to her bio, is a health policy correspondent for NPR and specializes in the politics of health care. In this recent story, she breaks down what’s happening with exchange enrollment, state by state. Since it is NPR, you can listen to the story if you choose – there is a 4-minute audio recording.

Sam Stein on Huffington Post: Obamacare enrollment reaches 4 million

Stein, a political reporter for The Huffington Post, provides an overview of enrollment numbers in the exchange and what’s likely to happen over the next few weeks leading up to the enrollment deadline. A quick one-minute video summarizes the article.

Jenny Gold of Kaiser Health News: New ACA Insurance Causes Headaches in Some Doctor’s Offices

A regular KHN reporter, Jenny’s stories cover the health care industry, overhaul and disparities for radio and print. Her pieces for KHN have aired for NPR and have been printed in USA Today, the Washington Post, MSNBC and more. Her story sheds light on another emerging issue now that enrollment numbers are increasing.

Narrow Provider Networks Are Not All The Same. Know the Difference…Someone’s Life Could Depend Upon It.

With the official arrival of healthcare reform, a lot has been written lately about the topic of “narrow networks.” In fact, we’ve recently written about it here Keep Your Doctor? Your Preferred Hospital? Do Your Homework Before Selecting A Plan.

Employers and their employees should know this: There could be a huge difference between established narrow networks of healthcare providers (developed and offered prior to 2014) and some of the new networks created primarily to accommodate the new lower cost Obamacare plans offered on the exchange.

Many of the narrow networks offered prior to 2014, for example, placed a more discerning emphasis on contracting with high performing providers. These networks gave a nod toward the combination of higher quality and lower cost.

Many of the new narrow networks created for the exchanges are aimed primarily at low cost and bear a striking resemblance to Medicaid networks. They are comprised mainly of only those providers willing to accept Medicaid-like fee-schedules.

Describing how carriers built these new networks, one highly respected industry insider indicated that contracts containing these low fee-schedules were mailed out to the provider community. Carriers then waited to see which of the providers would accept this low rate of pay and sign-up. The new networks were then built accordingly.

So what’s the net for all of us?

Caveat emptor. If you or your employees know anyone considering plans utilizing a narrow network, especially one of the lower cost Obamacare plans on the exchange, it’s more important than ever before to review and understand what providers are in the network before selecting a plan. Ultimately, someone’s life could depend upon it.

Most Large Employers Are Keeping Coverage: Mandates, Rules and All

More on what large U.S. employers are choosing to do in the wake of added Obamacare mandates, rules and general confusion over what to do. A recent national survey shows one percent of employers have decided to stop providing health care this year while approximately five percent have decided they will exit the health care system completely. This information is from a survey of large employers conducted by Aon Hewitt, a large employee benefits consulting firm,

According to Jim Winkler, chief innovation officer for health and benefits at Aon Hewitt, “Employers remain committed to providing health benefits, but recognize the need for new approaches that fix those problems.”

The survey includes more than 1,230 employers who currently provide coverage to over 10 million employees and identifies that large employers intend to shift more costs to workers via a “house money / house rules” approach. About 40% of the employers who participated in the survey are shifting more responsibility on their workers by asking them to take a more active role in their health. This includes initiatives aimed at lowering costs and improving employee health by offering health screenings and more robust health care coverage along with lower premiums to those employees who maintain better health.

Another one third of the companies surveyed revealed their plans to move employees to a private health care exchange within three to five years. Employers who move to the private exchange approach plan to provide a subsidy or “credit” to each employee who will then take their “credit” to the exchange to purchase their own health care coverage. Employers will determine the amount they will provide as a subsidy and the amount will vary from employer to employer.

Aon Hewitt has developed it’s own exchange and claims more than 18 large employers with a combined 600,000 workers are already using it.

Winkler goes on to say that “Traditional cost management tactics do not address foundational issues in health care, including worsening population health and misaligned provider payment methodologies.”

This information is a summary of an article titled “Employers Keeping Coverage Despite Obamacare Mandates, Rules” that appeared recently on


More Changes / Delays to the Employer Mandate

3 Employer Take-a-ways

The administration announced late Monday yet another change-up to one of the major focal points embedded in the Affordable Care Act  –  the employer mandate. Here are the three biggest aspects of the announcement that employers of all sizes need to know:

Employers with 100+ Employees

Employers with 100 or more workers will only have to cover 70% (down from 95%) of eligible employees in 2015 to avoid fines. The original 95% benchmark now goes into effect in 2016 and beyond.

Employers with 50 – 100 Employees

Employers in this category get a reprieve of sorts through 2015 as the mandate is delayed altogether for another year. As things stand today, they must begin offering coverage to eligible employees in 2016 in order to avoid fines associated with the new law.

Employers with fewer than 50 Employees

Under 50 employers (already exempt from the employer mandate to provide coverage) will now be exempt in 2015 and each year going forward from the reporting requirements they were subject to as originally outlined in the new law.

Despite speculation by many, as of yet there have been no changes or reprieves to the individual mandate that went into effect on January 1 of this year. It remains unchanged.

For more detailed information on Monday’s announcement see articles that appeared in the Washington Post and Fiscal Times

For an expert analysis, read Bob Laszewski’s piece at Health Care Policy and Marketplace Review.

Target Drops PT Employee Healthcare Coverage

The debate rages on about healthcare reform and how it will impact the insurance industry. A recent article from The Fiscal Times “More Companies Dump Employee Insurance for Obamacare,” discusses how Target recently announced it has dropped insurance for part-time employees, citing changes that have to do with new healthcare laws. Target follows in the footsteps of companies like Home Depot and Trader Joe’s, who have also dumped healthcare coverage for part-time employees in order to save on healthcare costs.

The companies claim that the action ultimately benefits their part-time employees since having employer-based health insurance disqualifies them from accessing coverage and subsidies through the new health exchange.

According to a report by CNN, Trader Joe’s company officials estimated that a large majority of their part-time workforce would be eligible for plans that cost considerably less money if they purchased insurance through the new health exchange.

There are many reports of the insurance industry’s lack of optimism in regards to Obamacare and how it will ultimately impact insurance. However, Brianna Ehley, author of The Fiscal Times article cited here, writes “…industry experts say it’s too early to tell how enrollments will affect market stability and premium prices.” She closes her article pointing out administration officials also say it’s too early to tell with about three months to go in the first enrollment period and that they expect most people to wait until the last minute to sign up, as was the case in Massachusetts.

2014’s Top 10 Healthcare Issues

PwC announced during a webinar earlier this month what they believe to be the top 10 healthcare issues of 2014:

1. Companies rethink their roles in the new health economy
2. Corporate funds invade healthcare venture capital space
3. Employers explore private exchanges
4. Industry picks up the pace of price transparency
5. Social, mobile, analytics and cloud come together
6. Technology is the new workforce multiplier
7. Twenty-first century tools refresh clinical trials
8. Fail fast, frequently and frugally for true innovation
9. States pursue Medicaid managed long-term care
10. New rules combat counterfeit drugs

PwC compiled this list based on polling data they collected in Fall 2013 from 1,000 consumers and interviews with top healthcare industry executives. For more information and comments from some of the webinar attendees, read Top 10 Healthcare Issues for 2014 as it appeared in Healthcare Finance News.

No Charge For Preventive Care Services? Verify Up Front to Avoid Out-of-Pocket Costs, Billing Hassles Later

The healthcare reform law requires that most health plans now cover common preventive care services without costing covered employees or their dependents anything out-of-pocket. However, the type of preventive service covered at no charge can be a moving target, especially based on where the service is performed, who performs the service, and how it is billed by the provider.  Correcting preventive care services billed incorrectly by a provider is a real hassle.

A prime example is described in the recent Kaiser Health News article Consumers Expecting Free ‘Preventive’ Care Sometimes Surprised By Charges.

To avoid unwanted and unwarranted charges and the hassles of getting a bill corrected, first verify with your insurance carrier that the service your provider is recommending is a valid preventive care service (covered at a 100% with no associated out-of-pocket cost or copay).  They should also be able to give you the correct billing code that providers should use.  Secondly, and just as important, insist that the provider correctly bill the procedure as preventive.

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