Out of Network, Out of Luck
As we behold the continued wonders of ObamaCare, we receive another reminder of the president’s empty promise, “If you like your doctor, you can keep your doctor.” The New York Times, late to the party as usual, observed this week, “No matter what kind of health plan consumers choose, they will find fewer doctors and hospitals in their network – or pay much more for the privilege of going to any provider they want.” What a surprise – stop the presses!
Insurance networks are common features of many plans. The network represents a group of physicians, hospitals, and other providers that contract with an insurance plan to provide specified medical care at set fees. As insurer United Health Care describes it, “[r]eceive quality care at reduced costs because our network providers have agreed to lower fees for covered expenses.” For the providers, this agreement represents a tradeoff – access to patients, but for lower payment. For the insurance companies, it’s a way to cut costs. These types of business arrangements are common. Businesses that join the AARP network agree to provide discounts to AARP members in exchange for access to AARP members.
In health care, access to patients is paramount for providers, and this access is through insurance networks. While AARP members won’t go bankrupt if they don’t take advantage of their half-price movie theater tickets or two-for-one lunch deals, going out of network for heart surgery or cancer care is another matter. According to United, “[t]he out-of-network provider's actual charge [may be] billed to the member.” Meaning that the patient could be on the hook for the entire cost of care.
This forces physicians and hospitals to accept lower fees in order to have access to patients. From an economic perspective, this makes sense, as the NY Times notes: “[n]arrower networks are essential to controlling costs and managing care.” But from the provider side, at some point the economics make no sense, and providers opt out of these networks. A restaurant may provide AARP members with free dessert as a perk, but it won’t provide $2 steak dinners and hope to remain in business.
Hence, many physicians and hospitals are not part of these narrow provider networks because they cannot or will not accept fees that don’t cover their expenses. Health care is a noble profession, but it is still a business. It doesn’t take a Harvard MBA to understand that working for a loss is an unsustainable business model.
It turns out many of the ObamaCare insurance plans have extremely narrow provider networks. As the Associated Press is just discovering, “[c]onsumers realize they bought plans with limited doctor and hospital networks, some after websites that mistakenly said their doctors were included.” If you have cancer and want treatment at one of the elite cancer centers, good luck. Many of the nation’s top cancer hospitals are out of network under ObamaCare plans. Walter White discovered this in the first season of Breaking Bad. He had to go out of network for his cancer care, cooking meth to pay for it.
And this is not just about cancer care. Seattle Children’s Hospital is out of network for most ObamaCare exchange plans in Washington State. If your child needs open heart surgery or cancer care, where would you rather go? A regional children’s hospital or the community hospital down the road?
The president is certainly pro-choice when it comes to abortion and other women’s health issues. But what happens to women in New York City who need cancer treatment and “choose” world-renowned Memorial Sloan Kettering Hospital? Good choice if they happen to have insurance through either of two of the nine insurers in New York City where Sloan Kettering is in network. Otherwise, choose somewhere else, and good luck.
“Pro-choice” sounds good on the campaign trail. But the dirty little secret is that the reality is “no choice.” As one insurance executive explained, “[w]e have to break people away from the choice habit that everyone has.” If you like your doctor, that’s nice, but you can’t keep your doctor. “We’re are trying to break away from this fixation on open access and broad networks.” Silly me, thinking I could choose my doctor. I’ll just go where the government or insurance company thinks I should go. After all, they know best.
Such limitations are not new. Twenty years ago, we saw the advent of HMOs and their restricted networks. Here we go again, and over four years into ObamaCare, the mainstream media is just learning this. The NY Times believes that “[t]here is evidence that consumers are willing to sacrifice some choice in favor of lower prices.” We’ll see. Walter White wasn’t willing to make that sacrifice.
Brian C Joondeph, MD, MPS, a Denver-based physician, is an advocate of smaller, more efficient government. Twitter @retinaldoctor.