DECEMBER 23RD, 2021
Do you know whether your health insurance plan has a narrow or broad network? It’s not something that insurance companies explicitly state, but it’s important for members to know.
Broad networks are what most people envision when they think of employer-sponsored insurance plans. These plans include a broad swath of area primary care physicians, specialists, and hospitals. As the name might suggest, narrow networks tend to be narrower in their coverage and include a smaller portion of area providers.
But exactly how narrow is narrow? While this can vary significantly between providers, there are some general guidelines to keep in mind. Whereas a broad network plan might include something like 70% of area providers, a narrow network might only include 10% to 25% of those providers.
Many insurance providers have been adding narrow network plans as a means of controlling costs. They partner with healthcare providers who agree to accept lower rates in exchange for a higher volume of patients. These savings are then passed on to plan members (and their employers) in the form of lower premiums.
Although narrow network plans have been a staple of self-insured folks since the passage of the Affordable Care Act, these plans haven’t been as common for people who get insurance through their employers.
Due to the ever-increasing cost of premiums, narrow network plans have been growing in popularity among group buyers as a more affordable alternative to traditional broad network plans. Let’s take a moment to explore the factors companies consider when choosing between these plans.
The decision between a narrow and broad network plan boils down to two factors: cost and access to care. Whereas narrow networks tend to carry more affordable premiums (16% cheaper, according to one study), they’re more limited in the number of care options available to plan members.
But it’s a little more complicated than that. When members on narrow network plans need to seek care outside of their networks, it can be significantly more costly than if they were on a broad network plan.
This is a large part of the reason why narrow network plans are more affordable. Broad network plans typically provide some coverage — even for out-of-network providers — in the form of a copay or coinsurance. Narrow network plans usually do not, which is what makes them more cost-effective for insurers.
Note that your odds of needing an out-of-network provider are quite a bit higher when your in-network options are limited — particularly if you live in a rural area with limited access to specialized care. This can make the decision of what to prioritize (cost or access to care) so difficult, especially on behalf of a group. The same plan that saves one member money by reducing monthly premiums can cause another member to incur exorbitant costs through out-of-network providers.
Some employers elect to offer both narrow and broad network plan options to their employees. This is typically more expensive for the employer than only offering a narrow network plan, but it gives employees greater flexibility in choosing a plan that makes the most sense for them.
It’s impossible to select a “perfect” plan for everyone in a group. The best thing you can do is provide choices that allow your plan members to customize their coverage and payment options.
Offering Paytient as a benefit is one way to offer such options. Paytient is an employer- and health plan-sponsored benefit that gives members access to interest-free funds they can use to pay for medical, dental, vision, and even veterinary expenses. Members use their Paytient cards to break large healthcare costs into a series of smaller payments — at whatever pace works best for them.
If you choose to exclusively offer a narrow network plan to your members, Paytient can act as a buffer to help cover any out-of-pocket expenses. This includes deductibles, copays, coinsurance, and any costs associated with seeing out-of-network providers.
If you decide to go with a broad network, Paytient still provides peace of mind to members who might be able to afford their care in full. Instead of paying a lump sum at the time of service, they can use Paytient to spread those expenses out over time and minimize the impact on their monthly budget.
Paytient’s mission is to eliminate unnecessary financial harm from the healthcare system. Whether you choose to offer a narrow or broad network plan — or both — Paytient can help make the plan work for more of your members. Rather than using a high-interest credit card, payday loan, or other more toxic means of paying for care, plan members can use Paytient to get the care they need now — and focus on getting better.
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