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Does PPACA make silver networks narrow?

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Congress is starting to talk about public exchange plan provider networks.

Edmund Haislmaier is arguing that the complicated Patient Protection and Affordable Care Act exchange plan cost-sharing subsidy structure makes narrow networks – and very narrow silver plan networks – all but inevitable.

In most states, the government will use tax credits to help people with family incomes of 100 percent to 400 percent of the federal poverty level pay exchange plan premiums. The premium tax credits will be available to people with incomes of 138 percent of poverty level to 400 percent of poverty level in other states.

The government will use the cost of the second-lowest-cost silver plan, or moderately rich plan, available to calculate the credit, but, once the its calculated, the consumer can apply that amount to the purchase of any available exchange plan, Haislmaier says, in a written version of hearing testimony posted on the House Oversight & Government Reform Committee website.

PPACA cost-sharing subsidies are available only to people earning less than 250 percent of poverty level, and only if those people enroll in silver plans, Haislmaier said.

Because the lowest-income enrollees are likely to have a high demand for care, unlikely to face enough exposure to co-payments to do much to minimize use of care and likely to minimize out-of-pocket costs by enrolling in silver plans, the carriers selling qualified health plans through the exchanges are expecting sick, low-income enrollees to flow into the silver plans and moderate-income enrollees who will get less or no help with cost-sharing to flow into the bronze plans, Haislmaier said.

To cope, many carriers are making their silver plan provider networks especially narrow, in an effort to economize, and letting their other plan have somewhat bigger networks, Haislmaier said.

“It’s difficult to see how any additional regulatory actions might produce expanded provider access,” Haislmaier said.

States or exchanges also could keep carriers with narrow network off the exchange, but that could reduce the number of choices consumers have, Haislmaier said.

Another hearing witness, Dr. Patricia McLaughlin, an ophthalmologist in New York City, says in her written testimony that she was surprised to find that few QHPs non-emergency out-of-network benefits. 

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