For about $200 a month, commercial real estate agent Harrison Klein was pretty satisfied with his Affordable Care Act healthcare coverage.
Like many consumers purchasing insurance on the federal exchange, Klein looked at sticker price when choosing a plan. What wasn’t clear at the time of signing up, and what still isn’t clear to many consumers across the country, was which healthcare providers he would have access to under his plan, or the provider network.
When the Coral Gables resident tried to find a primary doctor in his plan, his search yielded 10 possibilities — eight that weren’t taking new patients, one that was too far away and one in Coral Gables, which he chose.
Klein, 27, was in a narrow network — one that includes few primary care doctors, specialists and hospitals. That narrow selection lowers monthly premiums but may leave consumers scrambling for options.
“I went into it under the assumption that there would be a sufficient number of doctors in each network,” he said. “It was a pretty confusing process. I wasn’t sure what I was getting when I signed up for it.”
What’s worse: Klein said his only accessible primary care doctor incorrectly ordered an electrocardiogram and sent him to a cardiologist with a possible diagnosis of a serious heart condition. Another electrocardiogram and $1,200 later, the cardiologist informed Klein that his primary care doctor had misread the first test. Klein said he was told he was not sick.
But like many other marketplace consumers, Klein realized too late that the plan he’d chosen didn’t offer the healthcare providers he wanted.
Across the country, insurers are creating narrow networks to offset the loss of other cost-cutting mechanisms — such as higher premiums for people with pre-existing conditions — that are now banned under the Affordable Care Act, said Marilyn Serafini, vice president for policy at nonpartisan nonprofit the Alliance for Health Reform, at a California narrow networks conference last month.
According to June 2014 data from McKinsey & Company, a global management consulting firm, narrow networks make up 48 percent of all exchange networks in the nation. Additionally, 70 percent of the lowest-priced plans are built around networks that were narrowed to some degree to cut costs. The issue is less prevalent in employer-based insurance plans which are often broader to accommodate the needs of a diverse employee population.
Larry Levitt, senior vice president for special incentives at the Kaiser Family Foundation, said at the conference that the ACA established loose standards to prevent overly narrow networks, such as provisions of “sufficient choice” and providing benefits without “unreasonable delays.”
“Once the law was implemented through regulations, not a whole lot of detail was actually added,” Levitt said, according to a conference transcript.
Sabrina Corlette, senior research fellow at the Georgetown University Center on Health Insurance Reform, said insurance companies’ consumer research indicated marketplace shoppers would be very price sensitive, driving their decision toward narrow networks.
But at the point of sale, consumers are not clear on what they’re signing up for, she said.
“Even when they did their homework, it is very difficult to understand what network you were buying into,” she said. “It’s a head-scratcher. Why can’t we even get the basics of something like network right in terms of empowering consumers to make good decisions?”
Legal assistant Stacy Vazquez, 50, said she spent time looking through brochures and websites when helping her husband, Roy, 53, sign up for coverage last year.
“I was spending so much time, so many hours,” Vazquez said. “I’ve never seen such a disaster, honestly.”
Vazquez picked a Preferred Medical plan for her husband at a $380 monthly premium — but that was too expensive. Many of the doctors on the plan were also on northern Biscayne Boulevard, at least 20 miles from the Vazquezes in Palmetto Bay.
Vazquez said her husband is not signing up in 2015 but will instead pay the penalty for no insurance — $325 or 2 percent of household income, whichever is greater.
Still, there is good news. The National Association of Insurance Commissioners, the U.S. standard-setting and support organization for insurers in every state, released a draft of regulations late last year meant to improve the Affordable Care Act, including limiting narrow networks and requiring frequent updates to directories. The association’s model laws often serve to influence state legislators when shaping insurance regulations.
At Florida International University, Timothy Page, associate professor of health policy and management, is part of a collaborative called Health Economic and Strategic Solutions started this semester by university experts to help community members navigate the ACA. He said updates are crucial to the future success of the program.
“It’s unlikely that any policy is going to get it right on the first shot,” Page said. “What needs to happen is evaluation and continuous policy improvement.”
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This story was produced in collaboration with Kaiser Health News, an editorially independent program of the Kaiser Family Foundation