Physicians are finding ways to squeeze themselves into ever-slimmer health networks, but they should prepare for more change ahead due to payer consolidation and technological innovation.
So-called narrow networks, health plans that limit consumer choice of provider, have taken different forms. Some plans catering to large employers, for example, negotiate with leading, high-quality specialists for certain procedures.
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With the advent of healthcare exchanges under the Affordable Care Act, however, these networks proliferated to encompass broad swaths of both primary and specialty care, and consumer advocates have charged the focus is solely on cost cutting, resulting in inferior care.
In some markets, providers are feeling the pressure to accept significant reimbursement cuts in order to remain in network among a dwindling number of payers. Working within the boundaries of a given market, providers can maximize their leverage to stay listed in narrow plansâor make the break and try to forego them, experts say.
âThe concept is here to stay because itâs the bluntest instrument health plans haveâ to rein in costs, says Anders Gilberg, MGA, senior vice president for government affairs at the Medical Group Management Association.
Further reading: Quality metricsâa payer's perspective
Indeed, and providers may bear the brunt. In addition to increased patient bad debt from the higher deductibles in the Affordable Care Act, lower reimbursement from payers in narrow networks was cited as a risk for not-for-profit hospitals in a 2014 research note from Moodyâs Investors Service. The higher volumes traded for lower reimbursements may not materialize or make up for the shortfall, Moodyâs warned.
Still, providers havenât lost all negotiating power. Despite a scaling back in February of network adequacy requirements for 2017 under the Affordable Care Act, plans still need physicians to staff narrow networks, Gilberg says.
âPlans still have to go out and get the physicians they need, so they canât create a network thatâs unsustainable,â he says. âThere is pressure on every side of these relationships.â