Whether selecting a plan for enrollment or navigating a health change, knowing the ins and outs of your health insurance network can help you make more informed decisions.
What is a health insurance network?
Much like the networks and close-knit communities we all belong to, each health insurer works with certain professionals and organizations. Health insurers even select their network partners much like we select where we shop—by quality and value of services.
Why might a provider join a network?
There are two main reasons why healthcare professionals and organizations might join a health insurer’s network.
1. Joining a network helps steer patients to the provider’s practice due to cost savings and higher-quality standards. This means that health plan members—you—will tend to have lower healthcare costs and the reassurance that their provider has been vetted for quality care simply by visiting a doctor in their network.
2. Networks help to simplify and streamline payments. In the past, collecting payment was the responsibility of the provider facility and the patient. Today, networks help to ensure immediate payment from the insurance company. Although you may see fees outside of their insurance coverage, the network-payment process allows providers to continue operating efficiently and provide the care you need.
What types of networks are there?
The two most common types of networks are offered by Health Maintenance Organizations (HMO) and Preferred Provider Organizations (PPO). Like the name indicates, HMO plans are focused on managing a policy holder’s long-term health and wellness. HMO networks tend to be smaller, and a primary care physician (PCP) must refer you to network specialists. PPO plans were created to provide a broader network to meet members’ preferences for more choices of physicians and hospitals. As a national insurance provider, Credence offers a national PPO network for its members.
|Will the network be extensive?||Some HMOs are||Generally, much broader|
|Will I have direct access to specialists?||A PCP referral is usually required||With a specialist copay|
|Is out-of-network care usually covered?||Unless it's an emergency||At separate cost|
Please refer to your benefits booklet for a complete listing of your plan coverage. Benefits are subject to the terms, limitations and conditions of your plan.
How does in-network versus out-of-network work?
In the case of an emergency, care is covered as in-network regardless of your network type. Outside of emergencies, coverage varies by network type and your benefits plan. Selecting a provider within a PPO network is often the least costly option for care. Usually, PPOs have a broad network of healthcare providers, so it’s easier to find a doctor within the network. The big difference with in-network is that the providers have all agreed upon a fee as the maximum amount they will bill for a service.
If you were to receive care out-of-network, you may have to pay more for your coinsurance— your portion of cost sharing—plus any amount the provider charges above the fee negotiated by the plan, which is where expenses often add up. But with a PPO network, the network is so extensive that it should be easier to stay in-network and avoid extra fees. In fact, with a PPO, there are even out-of-state provider options. For instance, if your employer offers a Blue Cross plan with the Blue Card PPO network, you could have providers available in all 50 states and even some foreign countries.
With an HMO network, many benefits plans offered are provided for in-network-only benefits. Meaning, there is no benefit available if you choose to receive care out-of-network, except in emergency cases.
How do my prescriptions work with my network?
Your outpatient prescriptions are often covered through a pharmacy network. You may have this pharmacy coverage either through your primary health benefits or through your employer’s selected pharmacy benefits manager. If coverage is through your primary plan, you will likely have an extensive network of pharmacies to choose from. But either way, your pharmacy benefits manager will have a list of approved pharmacies and prescriptions. Much like your healthcare network, your pharmacy network agrees upon a fixed fee for all in-network prescriptions. When you use an in-network pharmacy, you will pay only what your health plan benefits require. In this case, you will never owe more than the agreed-upon cost.
How do I save by staying in-network?
By paying a smaller coinsurance or copay amount. In-network, you are guaranteed that the provider will only charge you an agreed-upon fee that has been negotiated by your insurer. Out-of-network, the provider can charge any fee they choose. You would be responsible for any amount that exceeds the negotiated rate.
Your health insurer negotiates rates for service with every partner in their network—meaning each in-network service will cost less for both you and your health plan. The difference between the billed amount and the allowed amount is the network savings. To see how much you save from in-network rates, you can take a look at your next claim statement.
If a provider isn’t in-network, it might be because they have chosen not to agree to the insurer’s proposed rate of service, or they didn’t pass the plan’s quality standards. If you were to see an out-of-network provider, a PPO plan may cover costs of care but at a smaller percentage of the total cost. For example, if your plan were to cover 80% of in-network care and 60% of out-of network care, here’s how that might look with a medical invoice for $10,000:
|80/60 PPO PLAN||Plan pays||You pay|
*any cost above the
The best way to save money—and to help you get the most value out of your plan—is to receive in-network care at every opportunity.
If you are a current Credence plan member, you can find in-network providers on Find Care.