Low-cost, limited-choice plans leave consumers satisfied


Bob Herman reported this week on Modern Healthcare’s business blog that a new study from researchers at Georgetown University’s Health Policy Institute is out.   They studied narrow-network plans sold in six states’ individual-market exchanges for the Robert Wood Johnson Foundation.

Herman’s article is available here.

After the first six months, those exchanges are reporting very few complaints from consumers who choose the plans with low-monthly premiums and a limited service network. And those plans that have no low-monthly premium options are beginning to be at a disadvantage. According to the study,

Officials in all six states report an expectation that insurers will narrow networks even further in 2015, and one insurance company official predicted, “I think you’re going to see a lot of experimentation among carriers in the first years.” In Oregon, for example, although there were 11 insurers competing in the nongroup marketplace, Moda Health Plan garnered 76 percent of the enrollees.

Many observers suggested they were able to achieve this market share because of their lower premiums, attributable at least in part to their narrower network offerings. A state marketplace official noted, “if plans want to compete with Moda [in 2015], they will have to come down in price, and networks are the easiest thing to fiddle with to do this.”

 Implementation of the Affordable Care Act: Cross-Cutting Issues

Six-State Case Study on Network Adequacy, Robert Wood Johnson Foundation, September 2014

It’s early and a number of factors remain to play out, such as how employees of larger companies might react to similarly paired down plans in their offerings, but the results could lead to a larger volume of these plans being offered outside of the exchanges.

If there’s less perceived consumer pressure for plans with multiple providers, insurers certainly will gain greater leverage in future contract negotiations with hospitals.

The original Georgetown/RWJF study can be found here.

Dewey Mooring

Nobody digs deeper than Dewey to understand a client’s business and industry and then translates the learning into creative insights. He leads our account team as well as authors strategic plans, creative briefs, and even oversees research for clients such as Vidant Health, Cooper University Health Care, Southwestern Vermont Medical Center, and Dartmouth-Hitchcock Medical Center, among others.

Dewey regularly speaks at healthcare industry conferences, including the Spring Symposium of the New England Society for Healthcare Communications (NESHCo), the Hospital Marketing National Conference, the Oklahoma Hospital Association, and the Wisconsin Healthcare Public Relations & Marketing Society.

He also led the teams that launched the NC Women’s Hospital and NC Children’s Hospital, as well as Vidant Children’s Hospital and the MD Anderson Cancer Center at Cooper.

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