Think About Provider Network When Choosing a Health Policy

(This blog is an expanded version of my final Column in the Coloradoan)

Most buyers of health insurance fall into two camps:

  • Those who want the least expensive plan possible. This group generally is mostly interested in the small stuff—getting their annual physical and lab work covered and maybe a visit or two to be treated for an infection. These tend to be the young, healthy invincibles. They’re not choosy about who their medical provider is and are often willing to have a doctor assigned to them, thus they gravitate to the more restrictive HMO plans.
  • Those who look for the finest doctors available no matter where they are located. They are selective not only about their primary care doctor, but also about the specialists that are available in their network. If they need surgery or get cancer, they want the ability to go to the best doctors and hospitals nationwide. These tend to be people that are getting older and realize that their odds of needing specialized, expensive care is increasing rapidly. They gravitate to the PPO plans.

Insurance is a highly competitive enterprise. Companies with the lowest rates, generally get most of the business, so insurers do their best to keep prices as low as possible. (Yes, it’s hard to believe with some  premiums as high as a mortgage!) As has been widely reported recently, one of the main ways insurers have used to keep prices down since this past year in the wake of the Affordable Care Act, has been to shrink their doctor networks since this allows them to negotiate better discounts with the doctors.

Consider the two biggest insurers in Northern Colorado, Kaiser Permanente and Anthem Blue Cross Blue Shield. Anthem’s HMO network in Northern Colorado has 222 primary doctors and 664 specialists. Their PPO network has 359 primary docs and 1365 specialists.

In contrast, Kaiser’s network is far smaller: 11 primary doctors spread among Fort Collins, Loveland and Greeley. Kaiser also allows their members access to Banner doctors. This increases the primary doctor count 60 and also gives access to 400 specialists. This much smaller network allowed Kaiser to be king of the hill this past year as they have offered the lowest premiums of any insurer in Northern Colorado.

Consider an even more striking example. Colorado HealthOP is a new insurer that is about to take away Kaiser’s crown for the lowest priced plan in Northern Colorado in 2015. HealtOp’s lowest priced PPO plan before any government subsidies is $336.75 for a 50 year-old using a very complete network of providers. However, their EPO network price for the identical plan is $249.43. That’s $87.32 less per month!  HealthOP accomplishes this feat with the use of so called “skinny networks”—networks with a sharply reduced number of doctors and/or hospitals.

Both approaches have their advocates. Personally, I favor the philosophy of having access to the widest selection of the finest doctors and hospitals. If I have a serious knee problem I don’t want a below average or average doctor operating on me. I want the very best surgeon that I can find…and I’m willing to pay extra for a plan that gives me that flexibility. If I get cancer, I want to be able to go to the best hospitals—not just in Colorado, but nationwide.

Just as specialists are not all the same, so primary doctors also differ. Some are better diagnosticians than others. Some have different philosophical approaches to medicine and it’s good to be able to select a primary doctor whose approach to medicine jibes with your own.

But this flexibility comes with a price, and we all have limits on what we can afford, or are willing to spend. And that’s why choice is a good thing.

After five and a half years of writing for the Coloradoan, this will be my last column. The Coloradoan is paring the number of columnists it will feature to concentrate more heavily on online content. They informed me that I didn’t make the cut because my column does not get enough readership. When I asked how they determined readership, they told me it was based on how many people read my column online.

Based on how many people have told me that they read and enjoy my column, I believe the Coloradoan is making a mistake. Maybe a big outpouring of letters might get them to reconsider.

Writing this column has been hard work but I have enjoyed it tremendously and have been gratified by the many letters and affirmations of thanks from so many readers, friends and clients. “Thank you” from the bottom of my heart!

Those who would still like to hear from me can find my blog on my website. You might also want to sign up for my free email newsletter featuring time sensitive topics related to health insurance and Medicare at http://tinyurl.com/trozan.

 

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