Will 2018 Be the Year of the High-Performance Network?

Will 2018 Be the Year of the High-Performance Network?

Employers are constantly searching for the best value for their company’s healthcare, and high-performance networks could be poised to become the next big thing.

Healthcare networks and member expectations are changing. Increasingly, employees are concerned about more than the size of their network. Instead, they want a healthcare network that offers it all: high-quality physicians, reasonable costs, and a streamlined claims process. For many employers, the best option might be a high-performance network like Canopy Health. 

Healthcare Costs Are Skyrocketing

Since 2007, the average cost of family health care coverage has increased by 55%. Health insurance premiums rise due to a series of factors. Some of these, such as patterns of overtreatment and a reliance on emergency rooms, are avoidable. Many traditional plans tout their broad networks and members’ ability to see a specialist without a referral. However, this unfettered “freedom” can lead to inefficiency, overtreatment, and poorly coordinated care. And for employers, traditional healthcare plans typically have higher premium costs.

If your clients are dissatisfied with their current healthcare network, they should consider a new, high-performance option. 

What Is a High-Performance Healthcare Network?

High-performance networks focus on quality rather than quantity. They are a form of narrow network (one that offers fewer physician options, typically less than 25% of a community’s providers). In exchange for a smaller network, members pay lower premiums. A high-performance network carefully selects its physicians based on the quality of their care and other metrics. They typically offer financial incentives to high-performing doctors as well.

Along with access to highly-skilled physicians, members of a high-performance network receive coordinated medical care. They work with a primary care physician (PCP) who oversees their care and makes referrals. The goal is to focus on preventive care, limit the need for emergency or intensive treatment, and increase efficiency. 

Why Are High-Performance Networks Increasing in Popularity?

In 2017, about 15% of employers offered health plans with a high-performance network. Another 9% offered a plan with a narrow network. However, narrow networks are more popular on healthcare exchanges. In 2016, more than 80% of healthcare plans on the California marketplace offered narrow networks.

Why are individuals choosing narrow or high-performance networks? Many prefer a manageable premium — especially when it’s combined with a smaller, but very high-quality, network of physicians. A high-performance or narrow network can cost up to 35% less than a traditional network. And healthcare that focuses on preventive care can reduce the quantity and cost of treatment each member needs. In other words, everyone wins. 

Employers have been less eager to transition to narrow or high-performance networks. A lot of it has to do with concern that a narrow network will reduce the amount and quality of benefits— especially if employees are required to switch doctors. However, a high-performance network like Canopy Health might actually improve its members’ health and wellness while reducing costs.

What Should Employers Look for in a High-Performance Network?

Before your clients select a narrow or high-performance healthcare network, they should ask themselves:

  • Does the network include high-quality physicians, hospitals, and providers that practice near where their employees live, work, and play?
  • Will members have access to top-rated hospitals and specialists?
  • Does the network take each member’s health and wellness seriously, or is it more concerned about cutting premiums?
  • Do physicians and medical centers have incentives for delivering high-quality care?
  • How transparent is the network about its size, costs, and other factors that might impact members’ health choices?

Ideally, a high-performance network should answer all these questions in the affirmative.

When employees have access to a streamlined, accessible network of physicians, hospitals, and other providers, a high-performance or narrow network might feel like an improvement over an overly complex and inefficient traditional network. 

Canopy Health: The Bay Area’s Premier High-Performance Network

Canopy Health offers an unparalleled combination of cost, access to care, and high-quality providers to Bay Area employers and their workers. Our alliance includes 18 hospitals and over 5,000 local physicians, specialists, and other providers*, many of whom are renowned for their expertise and cutting-edge research. 

We are dedicated to giving every member access to refreshingly clear, human care. To learn more about our innovative approach to Bay Area healthcare, contact us online or at 888-8-CANOPY.

*Pending Regulatory Approval from the Department of Managed Health Care for the following provider groups and hospitals: 

References:

Choudhury, J., Godla, J., Yaggy, J. Andrewes, J. (2015, July 15). High-performance health networks: a methodical approach creates a right to win. Strategy&. Retrieved from https://www.strategyand.pwc.com/reports/high-performance-health-networks

Kaiser Family Foundation (2017, September 19). 2017 employer health benefits survey. Retrieved from https://www.kff.org/health-costs/report/2017-employer-health-benefits-survey/ 

Polsky, D., Zhang, Y., Yasaitis, L., Weiner, J. (2016, December 6). Trends in physician networks in the marketplace in 2016. Leonard Davis Institute of Health Economics. Retrieved from https://ldi.upenn.edu/brief/trends-physician-networks-marketplace-2016