Tiered health plans confuse physicians, patients

As part of the health industry's movement toward greater cost-consciousness, tiered and limited network health plans are on the rise and confusing patients and physicians alike.

In Massachusetts, often considered to be at the vanguard for healthcare trends across the nation, tiered and limited network plans now make up 15 percent of the health insurance market, a figure industry leaders expect to grow during the next two years, The Boston Globe reported. As part of a recent amendment to the state's 2006 health reform law, insurers are required to offer the plans--which either restrict a patient's network of doctors or assign providers varying copayments based on cost and quality rankings--with premiums that are 12 percent below their standard plans.

Although this option offers patients substantial premium savings upfront, Massachusetts physician Sarah Bechta told National Public Radio's WBUR that even she can't determine whether a tiered plan would cost her family more in copayments and deductibles in the long run. For example, most insurers rate Boston's Children's Hospital as a tier 3, or high-cost hospital, to which one visit would wipe out Bechta's $1,400 in premium savings.

Even more frustrating, she said, is that every insurer uses different cost and quality measures to rank physicians, making it commonplace for physicians (herself included) to find themselves in different tiers for different health plans. Furthermore, Bechta said patients don't understand whether they pay higher copayments for some doctors because they are better physicians or less cost-efficient.

While insurers say growing numbers of employers are expressing interest in these products as a way to hold health costs down, Richard Weisblatt, senior vice president for provider network and product development at Harvard Pilgrim Health Care, added that "all of the health plans need to create easier-to-understand products with easier-to-use support tools."

To learn more:
- read the article from Kaiser Health News and National Public Radio
- see the post from the Boston Globe's White Coat Notes