December 4, 2018
New analysis from Avalere
finds that health plans with more restrictive networks, including health
maintenance organizations (HMOs) and exclusive provider organizations (EPOs),
continue to be the most common types of plans in the exchange market, with 72%
of the 2019 market comprised of such plans. The remaining plans are Preferred
Provider Organizations (PPO) and Point of Service (POS) plans, which tend to
offer comparatively broader coverage.
“Provider networks
are getting narrower, which means it is more important than ever that patients
understand what kind of plans they are buying,” said Chris Sloan, director at
Avalere. “Unknowingly enrolling in a narrow network plan could lead to patients
being unable to see their preferred doctor or go to their most convenient hospital.”
Exchange Plan
Network Design, 2016 - 2019
The trend toward
higher percentages of plans with restrictive networks has slowed (2019 plans
have a similar percentage of restrictive networks as 2018); however, the market
continues to be dominated by products featuring less choice. HMOs and EPOs are
considered more restrictive, or narrow, as they often have fewer providers in
their networks and across specialties compared to PPO and POS plans. Under HMO
and EPO plans, consumers are generally required to use in-network providers to
obtain coverage, while PPO and POS plans typically cover care conducted either
within or outside of a provider network.
“Network design is
one tool plans use to keep premiums low,” said Elizabeth Carpenter, senior vice
president at Avalere. “However, in addition to monthly costs, consumers need to
consider whether a plan covers their preferred doctor or hospital before
choosing an insurance plan.”
Methodology
Avalere analyzed
health plan information for states participating in the Federally-facilitated
exchanges (FFEs) to capture a large sample of plan designs utilized throughout
the country in the 2017, 2018, and 2019 plan years. Information on plan type
(PPO, HMO, etc.) includes only FFEs. Analysis is based on information from the
FFE landscape file and collected from the Covered California 2017, 2018, and
2019. Avalere analyzed the FFE landscape file for 2017 (extracted October 24,
2016), 2018 (extracted October 25, 2017), and 2019 (extracted October 24,
2018).
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