Consumer survey findings bode well for exchanges offering narrow network QHPs

A recent survey of consumer healthcare provider preferences by Harvard University and Booz & Company via the Harvard Business Review blog (Registration required) came up with some rather counterintuitive findings that bode well for the health benefit exchange marketplace. In order to keep premium rates low, some participating exchange qualified health plans (QHPs) have narrowed their networks of providers.

Consumers don’t necessarily prefer a wide selection of hospital networks. The survey found consumers preferred a small network with a high-quality system. “Consumers worried about receiving care for an unknown illness at some point in the future, find more comfort in knowing they will receive high quality care from a discrete set of facilities than in pondering a sea of options with little expertise in how to make sound decisions.” That makes sense considering that hospitalization isn’t typically a planned use of medical care and that most areas of the U.S. tend to be served by a small number of hospitals.

What’s noteworthy is the survey found the desire for a high-quality hospital system trumps having one’s primary care physician (PCP) in network, with respondents ranking an in-network PCP only half as important as having a good hospital system in network.  In a surprising finding, having one’s PCP in network represented less than five percent of the value consumers attribute to their health insurance. “While a dedicated patient/PCP relationship was once sacrosanct, today’s consumers are increasingly comfortable with getting primary care at retail clinics (e.g., CVS, Walgreens, Walmart, and Target) or using online and tele-health services that are quicker, more convenient, and often more cost-effective than a traditional office visit,” the HBR blog post notes. “Furthermore, as consumers become savvier in their decisions about benefits, even those who truly value their relationship with their PCP quickly recognize that picking up the occasional $150 co-pay to see a PCP who is no longer in-network is a relatively minor trade-off compared to the potential for a five-figure bill at an out-of-network hospital.”

Having upper-tier hospitals and health systems in network such as academic medical centers didn’t rank as a “must-have” among consumers.  “While reputation remains an important factor in consumers’ decisions, our research indicates that many safety-net and local hospitals are also well-regarded by consumers — and in particular by those who are currently uninsured. As such, lower-cost, high-value networks designed around these ‘lower-tier’ institutions could be attractive and desirable offerings for consumers.”


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

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Frederick Pilot

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