Kaiser Health New reported this week that limited network plans, which are also called narrow networks, have begun to make a comeback. Seeking to slow the rising cost of health insurance premiums, employers seem to prefer narrow networks, said the Kaiser Health News article, “HMO-Like Plans May Be Poised To Make Comeback In Online Insurance Markets.” In addition, Kaiser reported that narrow networks
… are expected to play a prominent role in new online markets, called exchanges, where individuals and small businesses will shop for coverage starting Oct. 1. That trend worries consumer advocates, who fear skimpy networks could translate into inadequate care or big bills for those who develop complicated health problems.”
In February 2012, I wrote about this trend in Managed Care magazine, Narrow Networks Found To Yield Substantial Savings, saying, “An early managed care idea that the marketplace once rejected is now being embraced by employers and offered by health plans.” The main attraction of these plans: lower premiums.
Aetna expects costs to be 1 to 4 percent lower with narrow networks than under more traditional plans. Health Net of Arizona predicts costs will be 10 to 20 percent lower, and Blue Shield of California predicts its first-year premiums for its Blue Groove product will be 10 to 15 percent lower than its traditional plans. Blue Shield also says costs for Blue Groove will rise by 5 percent or less in future years.”