McKinsey & Company published an intelligence brief on provider networks offered by healthcare exchange plans, focusing on broad and narrow networks.
The researchers found:
1. Broad networks have 70 percent of all hospitals in the rating area participating while narrow networks have 31 percent to 70 percent of all hospitals in the rating area participating.
2. Ultra-narrow networks have 30 percent or less of all hospitals in a rating area participating.
3. At least one broad network is available to 90 percent of the population, but these networks are an average of 15 percent more expensive.
4. Narrow networks are available to 92 percent of the population, making up around half of all exchange networks across the United States and 60 percent of networks in each state's largest city.
5. The prevalence of narrow networks is higher among cities, which include 30 percent of the survey's addressable population. In large cities, the prevalence of narrowed networks is 60 percent.
6. Broad network products report an average premium increase of 13 percent to 17 percent when compared with narrow networks. The increase adds up to $29 to $59 extra per month per member.
7. Close to 70 percent of the lowest price products are built around narrow, ultra-narrow and tiered narrow networks across the United States.
8. Higher excess bed capacity, greater provider or payer fragmentation and more significant growth potential from uninsured than from people who previously had coverage were factors associated with a greater prevalence of narrowed networks.
9. Less than half — 42 percent — of survey respondents who enrolled in an ACA plan were aware of the network type reported purchasing a narrowed network product; 26 percent said they were unaware of the network type they selected.
10. Around 75 percent of all ultra-narrow, silver-tier products include only some hospitals within participating health systems.