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Many Obamacare exchange plans do not include top hospitals

Report: Americans may find themselves out of network at top-tier facilities

Topics: Market Trends, Strategy, Health Policy, Payer and Regulatory Policy

November 01, 2013

Most of the 18 hospitals on this year's U.S. News and World Report's Honor Roll will accept insurance from just one or two companies selling plans on the Affordable Care Act's (ACA) insurance exchanges, according to a Watchdog.org investigation.

    >> Which Honor Roll hospitals accept your insurance under Obamacare? See the full list.

The investigative news site contacted each of the 18 hospitals on the 2013-2014 Honor Roll to determine their contracts. Investigators also spoke with insurance companies.  

The two hospitals on the top of the Honor Roll—Johns Hopkins Hospital in Maryland and Massachusetts General Hospital—are required by their state's laws to accept all insurance plans.

However, the investigation found that 11 of the remaining 16 hospitals on the list accept insurance from just one or two carriers selling plans on the exchanges. Even in states like California, where a dozen insurers are participating in the state marketplace, top hospitals accept few exchange plans, Watchdog.org noted. For example, Cedars-Sinai Medical Center will only accept insurance from one company.

University Hospitals Case Medical Center in Cleveland accepted insurance from four carriers in the exchanges, more than any other Honor Roll hospital. Meanwhile, the investigation notes that the hospitals also accept insurance plans sold outside the exchanges. For instance, Cleveland Clinic accepts dozens of insurance plans sold outside of the exchanges.

A price-quality tradeoff?

Former CMS Administrator Gail Wilensky says the investigation's findings do not come as a surprise. "There has been an incredible amount of focus on" premium costs and subsidies in the exchanges, but "precious little focus on what you get for your money," she says.

In response to the ACA's caps on premiums, insurers are expected to reimburse top-tier doctors and hospitals at lower levels. Many insurers are "concerned that [the exchanges] will be dominated by risky, high-using populations who wanted insurance [before Obamacare] and couldn't afford it," says Wilensky, adding that they "are pressed to narrow their networks to stay within the premiums."

Some experts worry that the changes will surprise consumers shopping on the exchanges, in part because many exchanges sites do not provide the names of physicians and hospitals include in the plans.

"In many cases, consumers are shopping blind when it comes to what doctors and hospitals are included in their Obamacare exchange plans," says Josh Archambault of the Foundation for Government Accountability. "These patients will be in for a rude awakening once they need care, and get stuck with a big bill for going out-of-network without realizing it," he notes.

The investigation also found deeper issues with the law's implementation: "Some hospitals and doctors don't even know if they are in the network," Archambault says. For example, Seattle Children's Hospital—No. 11 on U.S. News' best pediatric hospital list—recently filed a lawsuit after it discovered it had been excluded from five of seven insurance companies in Washington's exchange (Watchdog.org/U.S. News, 10/30).

Where are the U.S. News 'Best Hospitals'?

We mapped out this year's 'Best Hospitals' and listed the five U.S. cities with the largest number of ranked hospitals.

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