However, seniors aren’t the only consumers seeing more of these closed network plans. The ACA also led to the creation of online exchanges for consumers buying an individual plan, which has fueled pricing wars among different insurers.
Plans that limit patients to certain physicians and hospitals are generally less costly to operate than PPOs, enabling companies to offer them at lower rates. Consequently, more carriers started offering HMOs and EPOs (exclusive provider organizations), another type of plan featuring a limited network of providers.
In 2015, Kaiser Health News studied the 30 states that offer a plan on the Healthcare.gov website, and found that HMO-style offerings usually came in considerably cheaper. For a 40-year-old male buying a silver plan, the least-expensive closed network in these states averaged $299 a month in premiums. By contrast, PPOs with a comparable level of coverage cost $339 a month.
A Good Deal for Patients?
Aware of the bad rap that older HMOs received, insurance companies have tried to revamp their newer closed network plans to make them more appealing. Some insurers no longer require patients to get a referral before seeing a specialist, for example.
With ACOs, there’s also greater access to out-of-network providers. Doctors usually refer patients to specialists who are part of their network, but they have to notify patients of their right to see outside doctors at no extra charge.
Insurers argue such plans actually have certain benefits beyond just price. Specialists in a closed-loop system are more likely to have access to patient medical records, for example, so you are theoretically less likely to undergo unnecessary testing.
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