Many people get confused about what a Health Insurance Provider Network is and what do they do? They are healthcare providers and their main job is to provide healthcare at a discounted rate by contracting with an insurance company through EPO, HMO, or any other plan. The discounted price is then accepted as a total payment by the healthcare providers.
A health provider network is a vast group of people who are from various medical backgrounds/institutions including doctors, nurses, physicians, surgeons, chiropractors as well as hospitals, dental clinics, diagnostic labs, companies that provide home-based healthcare, and medical equipment providers.
Many well-known and trustable health insurance companies ask their patients for provider networks. The reason is that healthcare providers have experienced staff, and they meet healthcare quality standards. They are also flexible with providing their services at a discounted rate after negotiating their payment part in the healthcare plan.
Importance of Network Health Plans
The reason your health insurance company emphasizes the health plan’s provider is that it cuts down your copayment for your medical care. It is usually lower for an in-house-network than an out-of-network provider because, for the latter, you must pay a higher price. The health plan’s network does not compromise the quality, which means the consumer receives effective and quality care. For a provider network, it is important to consider the affordability factor of the consumer. That is why they negotiate prices with physicians and protect the consumers from added cost as well as balance billing.
In-Network Provider Vs. Out-Network Provider
An in-network provider only deducts any copay amount at the time of providing the service while directly billing the health plan. To see how much you will have to pay for the service, you can ask the provider to bill your insurance first. On the other hand, the out-of-network plan does not mostly flay insurance claims for the consumer, and you might end up paying for the entire service out of your pocket first. They could be risky in case your claim does not get accepted later.
The in-network provider due to a contract with the insurance company cannot balance-bill you. The insurance company negotiates a discounted price, which the in-network provider accepts. In case they do charge you for balance-billing, they can be sued for violation of the contract. However, out-of-network providers mostly do not sign any contract with the insurance company which means they can charge for balance-billing. The problem with an out-of-network provider is that they can easily charge you for services since they are not bound by any contract. This means you will have to pay a higher price since the insurance company will only pay the standard fee. This goes on to show that choosing an in-house network is usually the better option.
Types of In-Network Providers
There are three common types of in-network providers. The first one is a Preferred Provider Organization (PPO). These are the health providers chosen by your health plan’s network. If you choose a PPO, the health insurance provider might offer flexibility over an out-of-network provider.
The second is the Health Maintenance Organizations (HMO) which limits you to a single provider network. By choosing an HMO, you will have to go for a primary care physician for your medical appointments. Under a health maintenance organization, your healthcare coverage will be more restricted as only doctors and physicians who have a contract with the HMO can provide medical care. An HMO also generally has a lower premium than other in-house network providers.
The last one is the Point of Service (POS) plan provider. Here you will have the option of choosing a PCP along with the freedom to opt for out-of-network providers if you wish to. In the case of an out-of-network provider in POS, you might have to pay a higher coverage price.
This tells us that, before opting for a health plan’s network, it is extremely important to properly evaluate and review it. You need to learn the rules and policies of the health network provider and understand if they provide out-of-network coverage, if yes how much?
Talk to your healthcare provider and also involve your insurer to better understand the health plan’s network. It is important to include both the insurer and the health provider network to have a better understanding of the total cost of the plan excluding the part that’s going to be covered. Be sure to know who needs to get a referral in advance and if any pre-authorization is required to meet a specialist. Being aware of your health plan’s network will be less taxing when you will need healthcare coverage in the future.