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More than 40% of physician networks in ACA exchanges are 'narrow,' too

June 24, 2015

    Dan Diamond, Executive Editor

    It's no secret that many health plans in the Affordable Care Act's exchanges are "narrow"—they limit access to some providers, in order to tamp down costs.

    But researchers have spent two years trying to answer this question: Are the plans too narrow? To put it simply, do the plans include enough hospitals and doctors to ensure sufficient choice and coverage?

    A key challenge has been scoping the issue. And while one study suggested that 40% of hospital networks in the Affordable Care Act's exchanges are "narrow," the physician data was kind of a black box.

    But thanks to new findings from researchers at the University of Pennsylvania, now we know: physician networks through the ACA plans are pretty narrow, too.

    In their brief, Dan Polsky and Janet Weiner of the Leonard Davis Institute of Health Economics conclude that about 2 in 5 health plans available through the ACA exchanges rely on narrow physician networks—and they even offer a clever way of thinking about it.

    "Using consumer-friendly 't-shirt' sizing, we find that more than 40% of networks can be considered small or x-small, including 55% of networks in HMOs and 25% of PPO networks," Weiner and Polsky write in a post accompanying the brief. Meanwhile, about 24% of physician networks were deemed to be medium-sized, and another 35% were determined to be large or extra-large.

    This data wasn't easily found; the LDI researchers had to comb through 355 different networks across 50 states and Washington, D.C. They also had to clean up the data, which involved sorting out nearly 650,000 physicians.

    (Translation: The work was an "enormous undertaking," Austin Frakt notes at The Incidental Economist.)

    One key takeaway: There's a predictably huge range in the size of physician networks across specialties. For instance, the LDI researchers found that nearly 60% of oncology networks were small or extra small—but almost 60% of dermatology and ophthalmology networks were large or extra large.

    And as expected, there also was considerable variation by plan type. About 49% of physician networks in PPO plans were deemed to be large or extra large, compared to just 22% of physician networks in HMO plans.

    The brief doesn't answer all of our questions about access to providers in the insurance exchanges. Notably, "narrow networks" weren't an Obamacare creation—they predated the health law—and we still don't know if physician networks are traditionally more narrow or less narrow outside of the ACA exchanges.

    But the data is a key step toward understanding narrow networks, especially as states move to establish standards that ensure network adequacy.

    Understand how the ACA is changing health care

    Join Dan Diamond, Piper Su, and Ben Umansky for the latest installment of the Advisory Board's popular "Pulse Check on Obamacare" discussions. They'll break down the Supreme Court's much-watched decision on the Affordable Care Act, the latest data on ACOs and bundled payments, and the industry's continued shift toward value-based care.


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