Brookings experts: To better regulate narrow networks, take a 'multilayered' approach

Health insurance benefits form
The Trump administration’s decision to give the federal government less control over reviewing network adequacy for Affordable Care Act marketplace plans had the effect of weakening consumer protections, Brookings experts say. (Getty/michaelquirk)

Striking a balance between protecting consumers from narrow networks and dampening market innovation is hard.

And the Trump administration’s decision to give the federal government less control over reviewing network adequacy for Affordable Care Act marketplace plans made that effort even harder.

Such is the argument of Brookings Institution experts Mark Hall and Caitlin Brandt, who make their case in a new Health Affairs Blog post. The administration, they say, “punted” in the market stabilization final rule it released this April.

That rule effectively unwound the Obama administration policy of having the federal government review ACA marketplace plans—in states that didn’t operate their own exchanges—to ensure the plans met basic quantitative standards for network adequacy.

RELATED: Studies shed new light on Affordable Care Act exchange plans' provider networks

The policy shift had the effect of weakening network adequacy enforcement, as many states don’t have qualitative standards in place, don’t do much to enforce their qualitative standards or don’t have the authority or means to perform reviews themselves—instead relying on private accreditors. Further, most states lack an adequate process to protect consumers who are forced to seek out-of-network treatment to get the care they need, the post notes.

A better way to go about regulating narrow networks, Hall and Brandt argue, is to take a “multilayered approach” that weaves in qualitative standards, easy-to-administer quantitative standards and an efficient and neutral dispute resolution process that prevents patients from being financially penalized when they must obtain out-of-network care.

Hall and fellow Brookings expert Paul Ginsburg go into greater detail about these recommendations in a newly published white paper (PDF). “Having a back-stop dispute process in place would resolve a good bit of the regulatory burden of ensuring at the outset that a given network can meet all likely medical needs,” they explain.

This loosening of regulations—but not at the expense of protecting consumers—would “give health plans more flexibility to adapt to market conditions and to adopt promising innovations in care delivery,” they add.

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