The New York Times observed Sunday the Obama administration’s assertion that health insurance will cost less under Obamacare has a “catch”: insurers will severely limit the choices of physicians and hospitals available to American consumers who use the new exchanges.Though President Obama now famously said, when campaigning for his signature health reform legislation: “If you like your doctor, you can keep your doctor,” according to the NYT, that is not likely to happen if Americans want the lowest insurance rates possible:
From California to Illinois to New Hampshire, and in many states in between, insurers are driving down premiums by restricting the number of providers who will treat patients in their new health plans.When the Obamacare exchanges open on October 1, says the NYT, most of those shopping for health insurance will be low- to moderate-income Americans. To control costs, insurers are offering much smaller networks of health providers who will generally be paid less than what private insurance companies would reimburse them.
The situation could follow along the same lines as current Medicaid plans that are shedding health providers due to extremely low fees.
As the NYT acknowledges, “Decades of experience with Medicaid, the program for low-income people, show that having an insurance card does not guarantee access to specialist or other providers.”
For example, Cigna will participate in the exchanges in Arizona, Colorado, Florida, Tennessee, and Texas.
“The networks will be narrower than the networks typically offered to large groups of employees in the commercial market,” said Cigna spokesman Joseph Mondy.
The NYT quotes a recent study from the Health Research Institute of PricewaterhouseCoopers, which finds that when insurers avoid major medical centers when selecting providers it “enables health plans to offer lower premiums.”
However, “the use of narrow networks may also lead to higher out-of-pocket expenses, especially if a patient has a complex medical problem that’s being treated at a hospital that has been excluded from their health plan,” the study says.
Further, when health insurers exclude a hospital from its exchange network, the physician groups that are owned by the hospital are often also excluded.
When the issue of “pre-existing conditions” is considered—one of Obama’s top-level campaign features of Obamacare—the NYT admits that while “insurers will be forbidden to discriminate against people with pre-existing conditions, they could subtly discourage the enrollment of sicker patients by limiting the size of their provider networks.”
“If a health plan has a narrow network that excludes many doctors, that may shoo away patients with expensive pre-existing conditions who have established relationships with doctors,” said Mark E. Rust, the chairman of the national health care practice at Barnes & Thornburg, a law firm. “Some insurers do not want those patients who, for medical reasons, require a broad network of providers.”