What’s your story? The continuing saga of narrow networks

In our recently published Navigating Narrow Networks Guide, we explore the numerous issues and challenges narrow networks present to marketers. These days, not only are we tasked with improving the health literacy of the people we serve, but we are now challenged to improve their health insurance literacy as well, given the implications narrow networks have to patient access and financial responsibility.

What’s creating all of this energy around narrow networks? A recent article in Modern Healthcare says,

The ACA is driving much of the shift toward these narrow network products, said Gerald Kominski, director of the UCLA Center for Health Policy Research in Los Angeles. The healthcare reform law standardizes health plan benefits and sets caps on out-of-pocket costs. So providers and insurers are using unique networks as a differentiator. “If you’re competing on price and you can’t vary copayment structure or deductibles, the only thing you can do is try and keep your networks as affordable as possible,” Kominski said.

Interesting, since essentially this is another way of saying that providers and insurers are using value as a differentiator – the right network at the right price, delivering the right quality care. Of course, this strategy only works over the long haul if it’s true.

The pace of change and the complexities of these new narrow networks are extremely challenging for providers and consumers alike. Here’s another interesting event that recently occurred in the ongoing battle between insurance giant Highmark and nationally recognized health system UPMC to serve western Pennsylvania. In a recent AISHealth article, we read,

The health insurance industry’s equivalent of the feud between the Hatfields and the McCoys sprung up again this month, and the new battleground is Medicare Advantage (MA) products for 2015. Specifically, Highmark unveiled a new MA product, Community Blue Medicare HMO, with both zero-premium, high-cost-sharing and high-premium, low-cost-sharing options available. And the network for the product does not include the providers of its fellow Pittsburgh-area giant and archrival UPMC….When Highmark didn’t back down, contending the agencies were well aware of its plans for the new product while the consent decree was being negotiated, the agencies did file suit to prohibit Highmark from marketing any limited-network MA product that excludes UPMC providers.

Fascinating, right? Highmark buys health systems and creates a competing network, then seeks a politically enforced solution that requires UPMC to open up certain facilities and services to its members and “vulnerable populations.” Then Highmark turns around and designs MA narrow network products that exclude those very same UPMC services and facilities, and state agencies file suit to stop it. Equally interesting, this showdown has nothing to do with the ACA, which Mr. Kominski rightly identifies as the source elf of many narrow network strategies, but rather radically different visions for the future of healthcare in western Pennsylvania.

Whatever your situation, and whatever is driving narrow networks, they are increasingly a huge issue in the payor/provider contracting landscape. Keeping up with the latest news can be challenging, and so can mapping the right strategy in a rapidly shifting market landscape. Whatever your strategy as it relates to narrow networks, and your approach to contracting for them, clearly communicating your story to the board, physicians, internal audiences, and consumers is vital. Messages must be translated from complex to simple, and choices made clear so people know what to do. It’s an incredibly interesting challenge for managed care professionals and marketing communication strategists alike.

November 12, 2014
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