In the new health insurance environment, everyone is looking for a win-win: A solution that will provide great health care coverage to employees while minimizing the employer’s expense. This quest can be daunting, but one concept that holds promise for your benefits clients is micro-networks.
Let’s start with a definition. Micro-networks, also called “narrow networks,” have emerged over the last year and exist within carrier networks. They incentivize members to choose from a plan with fewer provider options and significantly reduced premiums. Most carriers will allow employers to offer a plan with a micro-network as an option, but not as a means of replacing the current network.
As we head to 2015, most major carriers are expected to implement smaller network options. They’re looking for ways to minimize costs for employers within the framework of the Patient Protection and Affordable Care Act (PPACA), which of course requires them to deliver affordable insurance to everyone, regardless of preexisting conditions.
Micro-networks were rolled out to public insurance exchanges this year. Conceptually they worked, although there were some issues.
Now, they’re being created for group employee plans. Micro-networks figure to be a big topic of discussion in 2015.
Micro-networks in action
Each carrier is putting a unique spin on how its micro-networks operate. Some offer a tiered approach, meaning that employers (and therefore the employer’s employees) have access to a full network but pay less if they receive care in-network.
Carriers that implement micro-networks have very specific goals in mind: they’re seeking to create low-cost, high-value programs. Consequently, they’ve been aligning with providers that they determine to be doing the best job at keeping plan users healthy for the best price.
That means they’ve been seeking out providers following the accountable care organization model (ACO) (typically larger hospital provider systems), who may be more open to being reimbursed based upon results rather than fee-for-service.
This combination of criteria appears to make micro-networks a good way for employers to control their costs while also delivering a high level of health care to their employees.
However, they aren’t a perfect solution.