The Impact of Narrow Provider Networks on Patterns of Care

Monday, June 13, 2016: 1:15 PM
Colloquium Room (Huntsman Hall)

Author(s): Caroline S Carlin; Bryan Dowd; Lucas Higuera

Discussant: Jessica Banthin

Research Objective:  To determine factors affecting choice of narrow provider network plans, and whether care covered by a narrow network PPO plan differs from care provided in a plan with a broader PPO network.  

Study Design:  Using claims data (2010-2014) from a regional health insurer offering a private insurance exchange for employment-based coverage, we use instrumental variable methods to predict enrollment in a narrow network plan option, and to identify the association between narrow network enrollment and future patterns in health care delivery.  Members select copayment structure and network structure separately, in a two-step enrollment process.  Network options include a broad PPO network covering 95% of the primary care physicians in the region, and four narrow provider networks.  Each narrow network is built around a vertically-integrated delivery system.

Population Studied:  The study sample includes employees enrolled through the private health insurance exchange who had coverage through one of the 93 employers offering network choice beginning in 2013.  We follow enrollees through 2014 to identify the short-term impact of narrow network choice on patterns of health care delivery.   

Principal Findings:  Preliminary results indicate a statistically significant decline in both primary care and specialty care visits, and a decline in the use of magnetic resonance imaging.  As expected, the concentration of care within a single care system was much higher for those enrolled in a narrow network plan; this result was robust to excluding enrollees in the broad PPO network who were receiving the majority of their primary care from a clinic system that was not vertically integrated.  The probability of accessing any care during the year was not impacted by narrow network enrollment, but that overall utilization levels declined (marginally significant) for those enrolled in a narrow network.  There were no associations between narrow network enrollment and the risk of hospital-based care (ED visits, avoidable ED visits, IP admission), and no associations with the probability of preventive cancer screening (breast, cervical, colorectal).

Conclusions: It is encouraging to see reductions in high-cost imaging and specialty care visits without increases in emergency department or inpatient care, or decreases in the probability of accessing any care in the year.  While reductions in primary care visits indicate a need for caution, the pattern of reduced utilization may be a result of better provider knowledge of the patient due to care concentrated within a single care system.

Implications for Policy or Practice:  Narrow provider networks, when built around a single vertically integrated system, hold the potential for improvements in clinical care due to better information flow among providers, reduced duplication of tests, and a more holistic knowledge of the patient.  Our results are consistent with this optimistic view, but additional work needs to be done to study the implications of reduced office visits and to study the long-term outcomes in narrow network plans.