Walter White and the narrow networks of Obamacare

Walter White and the narrow networks of Obamacare

As we behold the continued wonders of Obamacare, we receive another reminder of the president’s empty promise: “If you like your doctor, you can keep your doctor.”  The New York Times observed, “No matter what kind of health plan consumers choose, they will find fewer doctors and hospitals in their network — or pay much more for the privilege of going to any provider they want.”  What a surprise.

Insurance networks are common features of many plans.  The network represents a group of physicians, hospitals, and other providers that contract with an insurance plan to provide specified medical care at set fees.  As insurer United Health Care describes it, “Receive quality care at reduced costs because our network providers have agreed to lower fees for covered expenses.”

For the providers, this agreement represents a tradeoff: access to patients, but for lower payment.  For the insurance companies, it’s a way to cut costs.  These types of business arrangements are common.  Businesses that join the AARP network agree to provide discounts to AARP members in exchange for access to AARP members.

In health care, access to patients is paramount for providers, and this access is through insurance networks.  While AARP members won’t go bankrupt if they don’t take advantage of their half-price movie theater tickets or two-for-one lunch deals, going out of network for heart surgery or cancer care is another matter.  According to United, “The out-of-network provider’s actual charge [may be] billed to the member.”  Meaning that the patient could be on the hook for the entire cost of care.

This forces physicians and hospitals to accept  lower fees in order to have access to patients.  From an economic perspective, this makes sense, as the Times notes: “Narrower networks are essential to controlling costs and managing care.”  But from the provider side, at some point the economics make no sense, and providers opt out of these networks.  A restaurant may provide AARP members with free dessert as a perk, but it won’t provide $2 steak dinners and hope to remain in business.

Hence, many physicians and hospitals are not part of these narrow provider networks because they cannot or will not accept fees that don’t cover their expenses.  Health care is a noble profession, but it is still a business.  It doesn’t take a Harvard MBA to understand that working for a loss is an unsustainable business model.

It turns out many of the Obamacare insurance plans have extremely narrow provider networks.  As the Associated Press is just discovering, “Consumers realize they bought plans with limited doctor and hospital networks, some after websites that mistakenly said their doctors were included.”  If you have cancer and want treatment at one of the elite cancer centers, good luck.  Many of the nation’s top cancer hospitals are out of network under Obamacare plans.  Walter White discovered this in the first season of Breaking Bad.  He had to go out of network for his cancer care, cooking meth to pay for it.

And this is not just about cancer care.  Seattle Children’s Hospital is out of network for most Obamacare exchange plans in Washington State.  If your child needs open heart surgery or cancer care, where would you rather go?  A regional children’s hospital or the community hospital down the road?

The president is certainly pro-choice when it comes to abortion and other women’s health issues.  But what happens to women in New York City who need cancer treatment and “choose” world-renowned Memorial Sloan Kettering Hospital?  Good choice if they happen to have insurance through either of two of the nine insurers in New York City where Sloan Kettering is in network.  Otherwise, choose somewhere else, and good luck.

“Pro-choice” sounds good on the campaign trail.  But the dirty little secret is that the reality is “no choice.”  As one insurance executive explained, “We have to break people away from the choice habit that everyone has.”  If you like your doctor, that’s nice, but you can’t keep your doctor.  “We’re are trying to break away from this fixation on open access and broad networks.”  Silly me, thinking I could choose my doctor.  I’ll just go where the government or insurance company thinks I should go.  After all, they know best.

Such limitations are not new.  Twenty years ago, we saw the advent of HMOs and their restricted networks.  Here we go again, and over four years into Obamacare, the mainstream media is just learning this.  The Times believes that “there is evidence that consumers are willing to sacrifice some choice in favor of lower prices.”  We’ll see.  Walter White wasn’t willing to make that sacrifice.

Brian C. Joondeph is an ophthalmologist and can be reached on Twitter @retinaldoctor.  This article originally appeared in American Thinker.

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  • Duncan Cross

    First off, that’s a misread of Breaking Bad. Walter White got chemo so he could keep cooking meth, not vice versa. See http://duncancross.net/2014/03/breaking-bad-in-britain/ for a full explanation.

    Second, the fact that insurers are excluding doctors from their networks is the insurers’ fault and/or the doctors’ fault — not the government’s. I’m not a huge fan of Obamacare, precisely because it depends on insurers, and those insurers still have a lot of leeway to stick it to patients. Doctors and hospitals, for that matter, also have a lot of leeway to stick it to patients. But there’s nothing inherent in Obamacare that says insurers, doctors, and hospitals have to stick it to patients.

    Third, we’re mostly talking about people who did not have adequate insurance in the first place. The fact that they are in any network at all is an improvement over their previous status. They at least have the choice to get care, even if the network is not ideal.

    Incidentally, Walter White’s cancer still would have killed him, even with the best doctors in New Mexico.

    • JR

      Thanks for the link about Breaking Bad.

    • Steven Reznick

      These same individuals who did not have insurance now have it with narrow networks and deductibles that make obtaining care too expensive

  • QQQ

    This is just the tip of the iceberg folks and who knows just how deep the rabbit hole goes. The president has delayed many aspects of Obamacare because of costly delays. Wait until the whole package comes into play and people will then realize how much Obama has raised taxes and parts of it will hit the middle class. You ever notice box 12 of your W-2 where you have a DD with an amount listed. That is the cost of health coverage provided by your employer. It is there because Obamacare will tax it although I am not sure at what level because the administration doesn’t release this kind of information.

    • zzz05

      “A restaurant may provide AARP members with free dessert as a perk, but it won’t provide $2 steak dinners and hope to remain in business.”
      But I liked it the old way, when I could convince myself I was getting a steak dinner for $2. I don’t want to see the bill, I want to feel privileged.

    • Tyler Brown

      The excise tax only falls on certain low deductible “Cadillac” plans in which the insured pays little, if any, of the costs of their medical care out of pocket. These plans have been going away anyways, but the ACA will speed their demise. While those who will lose such plans might not like it, in the long run, it’s a good thing they’re going away, as such plans encourage over-utilization and unnecessary care.

      When, all told, medical errors add up to be the number three cause of death in the country, it’s pretty clear that the American notion of “more is better,” is wrong.

  • JR

    So, we have hospitals buying out independent offices and becoming “systems”. The reason the hospitals can make a profit is by adding on “faculty fees” to the same care that was being provided, therefore increasing the cost of care.

    When the insurer tries to negotiate prices, they are met with a hospital “system” that has a monopoly over an entire region. The prices that system wants to charge is way too high compared to other providers, but they’ve shut all other providers out of an area by buying it out. That means the insurer is held “hostage” to only one provider who can charge whatever they want.

    Solution 1: Close the “faculty fee” loop hole.
    Solution 2: Challenge the monopolies.

    Hospital systems are becoming more like cable companies everyday – lack of competition isn’t good for anyone except business owners.

  • buzzkillerjsmith

    Who is that guy in the picture? He no doubt looks as if he could use medical care.

    • eqvet2015

      Botox, hemorrhoidectomy, or both?

    • ninguem

      Hey Buzz

      You never saw “Breaking Bad”? That’s the lead character.

      It’s worth watching, pick it up on Blu-Ray or DVD. To each his/her own taste, of course, but “Breaking Bad” is widely regarded as one of the best TV dramas ever written, and many say it’s THE best ever written.

  • SteveCaley

    Golly, here in New Mexico, we LIKED our meth manufacturer, but we didn’t get to KEEP our meth manufacturer. He got canceled. That’s capitalism for you!

  • Bob

    When Carter was President he found GAO study “Fraud in Government Programs: –How Extensive Is It?
    –How Can It Be Controlled? and in the next 30 years waste, fraud and abuse increased to now being one third of the costs of medicine.
    To pay for this, all citizens are to accept ObamaCare which is being sold as a way to provide excellent care without having enough excellent providers to do so.
    There is no need to repeal it as it is so ill conceived it will “die on the vine”, which will make those who received all this Presidents promises sick for a good long while!

  • Mike Henderson

    It just amazes me that physicians continue to accept lower reimbursement and compensate by increasing volume. There isn’t enough time as it is, which results in medical decisions that increase costs elsewhere in the system, further reducing what insurance companies are willing to pay us. Further, I would imagine from a business perspective, why would an insurance company reimburse at a higher level if they know we will continue to see patients at a loss? The less we are paid, the harder we work. This is just circling the drain.

  • zzz05

    Boy, that Obama. What paragraph is it again that says that plans aren’t allowed to give access to the best cancer hospitals? Oh wait, I see it in your linked article “Before President Barack Obama’s health care law, a cancer diagnosis could make you uninsurable.” Yeah, cancer patients miss those good old days.

  • Steven Reznick

    When the deductibles in these plans are so high that they can not afford care. Yes it is great to receive vaccinations and mammograms and Pap smears and preventive items but when people get sick and have a $5000 deductible instead of a $25 co pay their costs go up and they defer care.

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