Proposing minimum network adequacy standards

It is generally easy to know the price of a health insurance plan (the premium), but how does one measure the quality of one? There are many dimensions to rate a plan one. For example, if a health insurer is notorious for denying claims, patients might be less likely to enroll with its plans. Another dimension is whether the insurance plan is accepted by a wide range of physicians. A insurance plan might not be popular with physician if it offers reimbursement rates that are too low or if it incurs too much hassle before paying claims. Inversely, health insurance plans can grow their networks by offering higher reimbursement rates, which unfortunately, generally causes the plans to be more expensive. As KFF Health News reports, the current administration is proposing to articulate specific network adequacy standards (for example, quantifying the lower bound on how many physicians of each particular specialty need to be available within patient populations).

When the Affordable Care Act passed, the legislation mandated the coverage of various conditions so that patients could more easily compare plans. Regulation around minimum network adequacy standards will help ensure that health insurance plans will be more useful to patients -- after all, what good is insurance if the patient cannot use it for lack of physician availability? Setting these standards can be difficult, but are likely to involve the number of physicians in an area that are in network relative to the number of patients in that area, with different ratios for different physician specialties. One component of the standards also seems to test how long a patient must travel in order to see a provider. Beyond the complexity of calculating network adequacy, these standards will also likely cause some plans to be more expensive, just as mandating a minimum level of coverage increased the price of health plans.