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Health care: Insurers’ limited networks distort the marketplace

By Robert Kaprove, M.D.

In an Another Voice column Nov. 10, Dr. Richard Vienne correctly described the reality of our health insurance system, explaining that patients who see physicians in their insurance company’s network will spend less money out of pocket than those who see physicians not in that network. These financial incentives created by insurers effectively limit patients’ choices of physicians. In addition, many health insurers limit their members’ choices of laboratories, pharmacies and, sometimes, hospitals.

There are four players in the health care system: employers (who pay, usually partially, their employees’ health insurance premiums), insurers (who are the middlemen), health care providers and health care recipients. Over the past several years employers and insurers have collaborated to restrict the choices of providers. Employers, often concerned more about costs than quality of care, frequently sign exclusive contracts with one insurer in exchange for a discount. Insurers cannot legally prevent patients from going where they would like, so they have distorted the marketplace by creating financial incentives that few of us can afford to ignore.

They have created a barrier between provider and patient.

The fact of in-network and out-of-network physicians, laboratories, pharmacies and hospitals is indisputable. “Network” means that the insurance company is limiting, through market manipulation, your choice of providers.

Insurers have also recently touted “tailored networks,” in which they limit further the choice of providers in exchange for even lower premiums. The word “tailored” implies better. If a network is good, a tailored network must be even better. In health insurance jargon, “tailored network” means, “We have limited your choice of providers even more.”

Do Americans deserve a health care system in which insurers limit our choice of providers? Where there are in-network and out-of-network providers? Can we do better? Imagine a health care system in which patients have almost unlimited choices of physicians, laboratories, pharmacies and hospitals. Such a system already exists. It is traditional Medicare Part B, backed by a Medigap plan and a Medicare Part D prescription plan. In this plan almost all non-hospital expenses are covered, except for prescription co-pays.

A bill in the New York State Legislature would establish a single-payer system to replace the many insurance companies now dominating, and distorting, the health care marketplace. It is time to consider a plan that functions more like Medicare than the private insurance carriers. A hearing about this proposal will be held in Buffalo Dec. 10 at Roswell Park Cancer Institute. Please attend to learn about this alternative to our present dysfunctional health care delivery system.

Robert Kaprove, M.D., is a physician practicing in Western New York.