Narrow Networks Prove Price, not Choice, Rules Healthcare Decisions

Citizen Wealth Financial Justice Health Care

WebNew Orleans          It’s becoming increasingly obvious that deep down without being willing to admit it, Americans are voting with their feet on the issue of health care and the tally is showing that their real preference would probably be the British National Health Service.  Now, there’s no likelihood of that happening of course but narrow and ultra-narrow networks are mimicking something very similar to that with the lowest price trumping choice at every turn.

In the marketplace offerings provided by the Affordable Care Act for 2014 almost half of the public exchange insurance selections were so-called narrow network options and 20% were ultra-narrow networks.   Narrow networks limit the insured consumer’s choice of hospitals and doctors within the network for their healthcare needs.  An ultra-narrow network provides even more stringent limits.   Of course seeking healthcare outside of that network is going to be more expensive so issues of transparency are central, but the ability of insurers to negotiate better pricing plans through narrowing in exchange for promising more volume of patients is working for both consumers and hospitals.

The McKinsey Center for Health Options quoted in the New York Times:

…found that 70 percent of the lowest-priced plans for 2015 were based on narrow networks of hospitals. They also had much lower rate increases in 2015, with a median increase of 4 percent, about half as much as broader plans.

McKinsey defines a narrow network as being composed of 31 to 70% of the hospitals in a geographical area and an ultra-narrow network as including 30% or fewer hospitals in an area.  Nearing 40% of consumers are choosing these plans and the industry is reporting only about 5% turnover between 2013 and 2014 choices, so that’s what they’re saying and they’re sticking to it.

It seems that consumers are saying two things.  First, that some health care is better than no health care, and, secondly, that the cheaper they can purchase adequate health care, the more that will drive their choices.

The industry would have us believe that this is a hand-clap for the general quality of health care in the United States, and perhaps this is one-hand clapping.  The industry’s earlier harangue about choice, echoed by many conservative politicians, seems on its way to being disproved on several counts. At one level when cost is driving the decisions there are no Marcus Welby’s and young Dr.Kildaires out there; it’s all about the money.  The same can be said about all of the super low end cheapo insurance policies that offered virtually no coverage and then would parade out consumers claiming they loved these worthless products; it’s all about the money.

Americans, like everyone, want to live without fear of dying, and that means believing they can go to a hospital when they feel sick.  In these days where it’s all about the money, they are going to increasingly look for the lowest cost for that simple guarantee, especially now that some kind of choice is mandatory.  In the meantime as the conservatives continue to rail about Obamacare, don’t let Americans know that in places like the United Kingdom and many other countries they can go to hospitals, regardless of income, and get quality care for free, or they might vote for that as well, if they were ever afforded the choice.


Begging for Change–Healthcare Blues