Health Industry Forum

October 30, 2014

Tiered and Limited Network Health Insurance Plans: Balancing Access And Affordability

Tiered and limited network health insurance plans are reemerging as efforts to limit the growth of health spending have intensified. In 2014, these products were 48 percent of the plans offered on the new Health Exchanges and cost 17 percent less, on average, than broad network products. They have also become more prevalent in employer-sponsored programs with 18% of large employers offering a tiered or “high-performance” network in 2014. As hospitals and health systems have consolidated and raised prices, limited and tiered products give insurers increased leverage to negotiate lower prices or exclude providers with excessive prices in order to offer lower premiums. But consumer groups and excluded providers have expressed concerns that networks may not provide sufficient access to quality providers. As a result, state and federal officials are looking more closely at additional mechanisms to protect consumers that select these types of plans.

This Forum will examine the re-emergence of tiered and narrow network products and the delicate balance of protecting consumers while providing sufficient flexibility for health plans to offer cost-effective products. It will examine the prevalence of these products in Exchanges, employer-sponsored plans and Medicare Advantage and discuss employer and health plan network strategies. It will review the available evidence about how these products affect spending and consumer choice and discuss key issues for consumers, providers, health plans and regulators as we examine the future role of these products in our health care system.