Providers

Bigger isn’t always better. This study about primary care physician practices proves it.

In primary care, like many other things, bigger isn’t always better. And in the case of primary care physician practices, this study backs it up.

It’s no secret among those who know me well that I have a strong affinity for small businesses and have long held that small and mid-size businesses are the backbone of our country’s economy. In an age of instant gratification where many flip businesses like houses, I find more often than not that it’s the small businesses and their leaders that champion the vision of building and sustaining meaningful companies committed to serving their clients while consistently providing jobs for themselves, their families and others in their communities. And, it’s the small businesses and their leaders that consistently prove to be the innovators.

CommonwealthFund-SmallPrimaryPractices-Aug122014

The study is titled “Small Primary Care Physician Practices Have Low Rates of Preventable Hospital Admissions” and was recently published by The Commonwealth Fund.

This study supports my notion and could also be instructive to you, your family and even your employees when it comes to selecting a Primary Care Physician geared to the combination of the best care AND the best cost…

 “[T]he common assumption that bigger is better should not be accepted without question, at least in practices of 19 or fewer physicians,” the authors conclude. The authors also question the practice of insurers typically paying lower rates to physicians in smaller practices, which typically have no negotiating leverage. Such an approach may well be shortsighted, they say, since the lower preventable admission rates achieved by small practices compared with large groups can mean lower overall costs for patient care…”

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

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.

Keep Your Doctor? Your Preferred Hospital? Do Your Homework Before Selecting A Plan.

With healthcare reform and the Affordable Care Act almost in full bloom, more potentially game-changing unintended consequences are starting to emerge.  One such consequence stems from the introduction of “narrow networks.” Initially intended for healthcare.gov or Exchange based products, most carriers have utilized the narrow networks to round out the low end of their 2014 individual and employer sponsored group plan offerings.

Employers changing plans in 2014 will have to pay closer attention to network selection. Or, potentially pay the price when you or your employees learn that preferred, familiar, closest and, in some cases, the best doctors and hospitals may not be in your plan’s network.

Until now, network size has not been a huge determinant in selecting carriers and plans. Most of the major insurance companies in the group market provided access to a vast selection of doctors and hospitals, especially those providers with the best reputations. With the advent of the Affordable Care Act and its impact on rate structures, benefits, and plan designs, carriers have less discretion on plan designs and rate setting. As a result, they are turning to these “skinnied” down networks as a primary means to manage costs, differentiate, and vary premium across their respective plan offerings.

In order to gauge the impact, I checked the online directories of two of the major group health plans in one large county in the Tampa Bay market where I reside. While decidedly informal and unscientific in nature, it nevertheless highlights the contrast.

I compared a few key categories of each respective carrier’s heretofore “staple” network (still offered; higher rates than the narrow network plans) against the new skinnier network offering (newly offered; lower rates than staple network plans). In both cases the “staple” networks contained a significantly greater number of providers, were described as open access, and did not require referrals. The new skinnier networks offered fewer participating providers, required designation of a Primary Care Provider (“PCP”), and required PCP referrals to obtain other services.

In comparing several categories of specialists, the narrow networks were on average comprised of about 50% fewer specialist physicians than the traditional networks.  However, the biggest difference between the customary networks and the newer narrower networks came when comparing participating PCPs and hospitals.  Here’s the breakdown:

Carrier 1

Carrier 2

OA Network

Narrow Referral-Driven  Network

OA Network

Narrow Referral-Driven  Network

Primary Care

1280

227

1300+

325

Hospital Primary and Secondary

12

3 (includes 1 major)

18

10 (includes 1 major)

We’ll be monitoring further developments, reporting more on this issue in future posts as well as discussing practical alternative strategies to this growing cost vs. access issue (eg. direct contracting, plan customization, buying a lower cost plan and supplementing, etc.).

In the meantime, what can you do?

When it comes to changing to new plans, look before you leap.  Or, at least plan on doing some homework.

To read more about this topic go to these recent articles in the Washington Post, Insurers Restricting Choice of Hospitals and Doctors to Keep Costs Down,” and at Health Care Policy and Marketplace Review, If You Like Your Doctor You Will Be Able to Keep Your Doctor. Period.”

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