Issues

73% of Exchange Market in 2018 Will Include More Narrow Networks With Fewer Providers

Analysis finds deductibles for Obamacare silver plans projected to increase by nearly $4,000

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Nearly three-fourths of the exchange market in 2018, or 73 percent, will include more narrow networks with fewer providers, according to an analysis from Avalere.

In 2017, 68 percent of the market included health maintenance organizations (HMOs) and exclusive provider organizations (EPOs) with more restrictive networks. In 2016, 54 percent of the market included these types of networks.

"HMOs and EPOs are considered more restrictive—or narrow—plans, as they often have comparatively fewer providers in their network and across specialties compared to Preferred Provider Organizations (PPO) and Point of Service (POS) plans," the analysis explains. "Under HMO and EPO plans, coverage is usually exclusive to in-network providers, while PPO and POS plans offer broader coverage."

The exchange market in 2018 is expected to include 27 percent of plans that are PPOs or POS plans.

According to Caroline Pearson, senior vice president at Avalere, insurers are continuing to focus on narrower networks, since it helps them manage medical costs and have more competitive premiums.

"These narrow network plans may come at a lower price tag for consumers, but they may also limit consumer choice and access to specialist care," Pearson said.

According to Avalere, deductibles for Obamacare silver plans, the most popular type of plan, will increase to $3,937 in 2018. In 2015, deductibles for this type of plan cost $3,703.

Deductibles for Obamacare's gold plan are also expected to rise next year, while deductibles for the platinum and bronze plans are projected to decline.

"For the most popular exchange plans, we will see an increase in deductibles for 2018," said Elizabeth Carpenter, senior vice president at Avalere. "This trend helps reduce premium costs, but may increase what consumers must pay out-of-pocket for their care."