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Should the State Require California Carrier Networks Be the Same Providers for IFP and Business Plans?

by John Hansen

A health insurance agent complained to Assemblyman Jim Wood at the CAHU Capitol Summit 2016 about California carrier networks. The agent mentioned a client who left his California group health insurance and switched to an individual plan with the same carrier. However, once he did, he found that his doctor was no longer in network. This consumer stayed with the same carrier, but the change from a small business to California individual health insurance coverage caused the provider network to change.

So this agent questioned, “Should California carrier networks be the same for individual and family as they are for small group health coverage?”

Assemblyman Jim Wood had no response to the question, but seemed to think it was an interesting comment. Obviously, CA provider networks wasn’t a hot topic in Sacramento. But a good question none-the-less.

Standardized Health Insurance Benefits

ACA has standardized the health plans so people can look at Covered California’s metallic plans and do apples-to-apples comparisons. It makes it easy when you know that Anthem’s Bronze Plan has the exact same benefits as Blue Shield’s Bronze Plan.

Standardized California Provider Networks

What if we standardized the California carrier networks? If California legislators or the California Department of Insurance required the carriers to offer the same provider networks for individual and family as they do for small business, this would simplify things for consumers who often have to make decisions regarding individual or group coverage.

This does require more meddling with the economy and less of a free market. It could cause rates to rise in the individual and family market. At this point, California health insurance carriers are still seeing more risk in the individual market, so limiting the California carrier provider networks is one way of keeping premiums more affordable for the individual and family plans.