Research in Massachusetts has revealed that these strategies don’t cause any harm to patients and they save money.
Despite the fact that the majority of patients don’t like hearing that they can’t go to a certain hospital or see a certain doctor because of the limited network of coverage provided by their health insurance, this type of plan is becoming increasingly commonplace.
These “limited” network plans (also known as “narrow”) are being seen more often than ever before.
The reason is that these health insurance policies are typically cheaper for individuals and employers than other options. The reason is that they can leave out coverage at hospitals where care is typically more expensive. Insurance companies can also negotiate with doctors and hospitals for cheaper prices when they are guaranteed the business of their policyholders. However, this has not led to the most positive experience from patients who don’t appreciate the fact that they don’t have the option of any doctor or hospital that they want. Many have feared that they risk lesser care because of limited options.
A recent study in Massachusetts suggests that the quality of care does not deteriorate as a result of limited networks.
The study looked at a considerable shift toward limited network plans which occurred in 2011 in the state, when employees were granted a “premium holiday” for three months if they agreed to change to the lower cost health plans from their traditional forms of coverage. Employees of the state that opted to take advantage of this option then reduced their own health care spending by 36 percent.
John Gruber, one of the study’s co-authors, explained that “Clearly, this was a big cost-saver for the state.” He explained that the savings was the result of the reliance of the owners of those limited network health plans less on specialists and more on primary care. Equally, the study did not identify any evidence that the quality of care that those patients were receiving was any lower than the level they were receiving when they still had traditional coverage.
Gruber was among several creators in the Affordable Care Act and the Massachusetts health insurance coverage law.