Employees in narrow networks spent up to 36% less on healthcare

Several recent studies highlighted the positive and negative consequences of narrow provider networks on cost of and access to healthcare services, reports The New York Times.

Leonard Davis Institute at the University of Pennsylvania in Philadelphia reported health plans with very narrow networks charged 6.7 percent lower premiums than plans with much broader networks. The study defined a narrow network as covering care by less than 10 percent of physicians, and defined a broad network as covering care by up to 60 percent of physicians.

The same report found lower premiums and narrow network plans translated into annual savings for an individual of between $212 and $339.

A 2012 investigation by the Massachusetts Group Insurance Commission also highlighted the potential cost-savings of narrow network plans without sacrificing quality of care.

The study compared state employees who switched into narrow network employer-sponsored health plans to employees with broad-network coverage. Researchers found those who switched into narrow plans spent 36 percent less on healthcare than their counterparts.

MGIC also found the distance narrow network enrollees traveled for primary care visits decreased. The study found plans that narrowed their network of specialists but increased their network of primary care physicians had more satisfied customers that saw lower costs per outpatient care visit.

But a study of California health plans showed the potential negative impact of narrow networks on policyholders' access to care.  

Researchers from West VirginiaUniversity, University of Wisconsin-Madison and the University of California, Irvine, found patients' access to primary care physicians was dismal for plans offered through California's exchange in 2015.

Approximately 30 percent of policyholders' attempts to schedule appointments with primary care physicians were successful. About 30 percent of all physicians called were not primary care physicians, despite being listed as such in the plan's directory.


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