The Velvet Rope of Narrow Networks

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The insurers love the concept of narrowing networks.  Here, from the WSJ, is what the plan is:

Offering a smaller selection of health-care providers holds down costs, in part because hospitals and specialists with the highest reimbursement rates can be cut out. Insurers now increasingly strike special deals with providers that aim to incentivize more efficient and high-quality care. HMOs often also include hurdles to care, such as requiring a referral in order to see a specialist.

This is about money.  This is about control.

A new term being used is EPO or “exclusive provider organization”.  Brilliant euphemism.  It has that velvet rope connotation but is just the opposite. When you see EPO think “narrow network”, which means you lose total control of who you can see.  This is the trend we expect to see:

In Washington, Premera Blue Cross said it will next year stop selling PPO plans that had enrolled 49,100 on the state’s exchange. Instead, Premera will offer EPOs that don’t include out-of-network coverage.

People criticize Obamacare for gouging the middle class in taxes, for helping the insurers raise rates and for making deductibles unreachable but they forget the cherry on top, which are these narrow networks.  Nice work.

89560cookie-checkThe Velvet Rope of Narrow Networks