Narrow network plans make up 73% of ACA exchange market

The offerings on the Affordable Care Act’s health insurance exchanges for 2018 are dominated by narrow network plans, with higher deductibles for silver- and gold-level plans, according to an analysis from Avalere.

The breakdown of plans by network designs:

• 57 percent are health maintenance organizations (HMOs)
• 16 percent are exclusive provider organizations (EPOs)
• 21 percent are preferred provider organizations (PPOs)
• 6 percent are point of service (POS) plans

The analysis covered states participating in federally-facilitated exchanges as well as the state-based exchanges in California and New York. The combined 73 percent market share of the plans for the more restrictive networks (HMOs and EPOs) increased in 2018 from 68 percent in 2017 and 54 percent in 2015.

“We continue to see insurers focusing on narrow network exchange products that enable them to offer competitive premiums and manage medical costs,” Caroline Pearson, senior vice president at Avalere, said in a statement. “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.”

Narrower networks have become more prevalent in each year since the ACA exchanges first opened. The idea was to limit costs on an uncertain risk pool by keeping the provider roster limited, but it’s also led to criticisms from ACA opponents that those covered by exchange plans lack access to the care they require. It can also be confusing to patients, as insurers may not keep their in-network directories up to date and even at in-network facilities, they may unwittingly receive care from an out-of-network provider and get hit with a “surprise” bill.

Employer-sponsored plans are now adopting similarly narrow networks, with Forbes reporting up to half of large companies considering or having already implemented more restrictive plans for 2018.

Beyond having fewer doctors covered under their plans, ACA exchange customers may face rising out-of-pocket costs in 2018. For silver-level plans—the most popular out of the ACA’s metal tiers—the average deductible will average $3,937 in 2018, up from $3,703 in 2017. Gold-level plans will also have higher average deductibles, rising from $1,051 in 2017 to $1,142 in 2018. Consumers earning less than 250 percent of the federal poverty level will be shielded from some of these out-of-pocket costs by the ACA’s cost-sharing reductions.

For bronze- and platinum-level plans, however, deductibles will be lower on average in 2018. Bronze deductibles fell from an average of $6,014 in 2017 to $5,873 in 2018, while platinum plans—which typically have the highest monthly premiums but pay an average of 90 percent of a member’s healthcare expenses—will have deductibles drop from $110 to $35.