Consumers who bought insurance on the health exchanges last year had access to one-third fewer doctors and hospitals, on average, than people with traditional employer-provided coverage, according to an analysis released Wednesday.
The study by consulting firm Avalere Health provides a statistical basis for anecdotal reports from consumers and others about the more limited doctor and hospital choices in plans offered on marketplaces created by the Affordable Care Act.
In these “narrow networks,” health plans negotiate contracts with a select number of providers who agree to be reimbursed at lower rates. That means the insurers can set their premiums lower, at least theoretically. But, depending on the plan’s design, consumers typically pay more, and sometimes much more, if they use a doctor or hospital outside the network.
Compared with traditional employer coverage, exchange plans had networks with 42 percent fewer cancer and cardiac specialists; 32 percent fewer mental health and primary-care doctors, and 24 percent fewer hospitals, the Avalere analysis found.
The report underscores the importance of consumers knowing whether particular doctors or hospitals are included in their plans’ networks. Some plans, such as HMOs, don’t permit out-of-network coverage.
Other plans do cover care provided by out-of-network doctors and hospitals, but consumers pay more out of pocket than they would if they went to in-network providers. And in those plans, consumers may find that those costs don’t count toward their deductibles or out-of-pocket maximums.
Insurance companies tend to be excluding traditional, high-cost teaching hospitals and “expensive, prestigious providers” from the networks, said Dan Mendelson, Avalere’s chief executive. That’s not necessarily bad for consumers, he said, because having several choices of providers does not always improve quality of care.
A more tightly controlled network of providers could mean better management of chronic conditions, such as diabetes and high blood pressure, he said.
A May study in Health Affairs found that California hospital networks are narrower in exchange plans than in commercial plans, but that the networks have a comparable or even higher average quality than networks of their commercial counterparts.
A poll last year by the Kaiser Family Foundation found that the people most likely to buy coverage on the insurance marketplaces were more willing than the public at large and people with employment-based coverage to accept a narrower network of doctors and hospitals in exchange for lower costs. In general, older people and those with higher incomes prefer broad networks, even if they cost more, while younger people and those with lower incomes are more evenly divided.
Avalere researchers analyzed data submitted by the health plans for the largest rating region in each of the five states that had the highest enrollment in exchanges for 2015 coverage: California, Florida, Georgia, North Carolina and Texas. Avalere compared the average number of providers in exchange networks with commercial networks in the same geographic area for each of the five categories of providers.