WASHINGTON Federal officials often say that health insurance will cost less than expected under President Barack Obamas health care law. But they rarely mention one big reason: From California to Illinois to New Hampshire, insurers are restricting the number of providers who will treat patients in their new plans.
When insurance marketplaces open Oct. 1, most of those shopping for coverage will be low- and moderate-income people for whom price is paramount. To hold down costs, insurers say, they have created smaller networks of doctors and hospitals than are typically found in commercial insurance. And those health care providers will, in many cases, be paid less than what they have been receiving from commercial insurers.
Some consumer advocates and health care providers are increasingly concerned. Decades of experience with Medicaid, the program for low-income people, show that having an insurance card does not guarantee access to specialists or other providers.
THE SQUEEZE IS ON
Consumers should be prepared for much tighter, narrower networks of doctors and hospitals, said Adam M. Linker, a health policy analyst at the North Carolina Justice Center, a statewide advocacy group.
That can be positive for consumers if it holds down premiums and drives people to higher-quality providers, Linker said. But there is also a risk because, under some health plans, consumers can end up with astronomical costs if they go to providers outside the network.
Insurers say that with a smaller array of doctors and hospitals, they can offer lower-cost policies and have more control over the quality of health care providers. They also say that having insurance with a limited network of providers is better than having no coverage at all.
Cigna illustrates the strategy of many insurers. It intends to participate next year in the insurance marketplaces, or exchanges, in Arizona, Colorado, Florida, Tennessee and Texas.
The networks will be narrower than the networks typically offered to large groups of employees in the commercial market, said Joseph Mondy, a spokesman for Cigna.
The current concerns echo some of the criticism that sank the Clinton administrations plan for universal coverage in 1993-94. Republicans said the Clinton proposals threatened to limit patients options, their access to care and their choice of doctors.
At the same time, House Republicans are continuing to attack the new health law and are threatening to hold up a spending bill unless money is taken away from the health care program.
In a new study, the Health Research Institute of PricewaterhouseCoopers, the consulting company, says that insurers passed over major medical centers when selecting providers in California, Illinois, Indiana, Kentucky and Tennessee, among other states.
Doing so enables health plans to offer lower premiums, the study said. But the use of narrow networks may also lead to higher out-of-pocket expenses, especially if a patient has a complex medical problem thats being treated at a hospital that has been excluded from their health plan.
In California, the state-wide Blue Shield plan has developed a network specifically for consumers shopping in the insurance exchange.
Juan Carlos Davila, an executive vice president of Blue Shield of California, said the network for its exchange plans had 30,000 doctors, or 53 percent of the 57,000 doctors in its broadest commercial network, and 235 hospitals, or 78 percent of the 302 hospitals in its broadest network.
Daniel R. Hawkins Jr., a senior vice president of the National Association of Community Health Centers, which represents 9,000 clinics around the country, said: We serve the very population that will gain coverage low-income, working class uninsured people. But insurers have shown little interest in including us in their provider networks.
In New Hampshire, Anthem Blue Cross and Blue Shield, a unit of WellPoint, one of the nations largest insurers, has touched off a furor by excluding 10 of the states 26 hospitals from the health plans that it will sell through the insurance exchange.
Christopher R. Dugan, a spokesman for Anthem, said that premiums for this select provider network were about 25 percent lower than they would have been for a product using a broad network of doctors and hospitals.
Anthem is the only commercial carrier offering health plans in the New Hampshire exchange.
Peter Gosline, the chief executive of Monadnock Community Hospital in Peterborough, N.H., said his hospital had been excluded from the network without any discussions or negotiations.
Many consumers will have to drive 30 minutes to an hour to reach other doctors and hospitals, Gosline said. Its very inconvenient for patients, and at times its a hardship.
David Sandor, a vice president of the Health Care Service Corp., which offers Blue Cross and Blue Shield plans in Illinois, Montana, New Mexico, Oklahoma and Texas, said: In the health insurance exchange, most individuals will be making choices based on costs. Our exchange products will have smaller provider networks that cost less than bigger plans with a larger selection of doctors and hospitals.
Dr. Barbara L. McAneny, a cancer specialist in Albuquerque, N.M., said that insurers in the New Mexico exchange were generally paying doctors at Medicare levels, which she said were often below our cost of doing business, and definitely below commercial rates.
Outsiders might expect insurance companies to expand their networks to treat additional patients next year. But many insurers see advantages in narrow networks, saying they can steer patients to less expensive doctors and hospitals that provide high-quality care.
Even though insurers will be forbidden to discriminate against people with pre-existing conditions, they could subtly discourage the enrollment of sicker patients by limiting the size of their provider networks.