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What to Know About Narrow Networks

April 01, 2024
What to Know About Narrow Networks
Choosing the right health insurance plan can require a fair amount of research. Understanding the relationship between monthly premium costs, deductibles and co-pays has long been at the top of this list. More recently, knowing the kind of health care network a plan provides has also become important. An increasing number of insurers now promote “narrow network” plans that can be less expensive than more traditional offerings. However, that added affordability comes with a tradeoff that could leave you with fewer options for covered medical services.
Understanding Narrow Networks
Narrow network plans are similar to the health maintenance organizations (HMOs) that many of us have turned to for years. Like standard HMOs, these plans limit coverage to a select group of physicians, specialists and hospitals. However, narrow network plans can be even more restrictive in the number of providers they include. Those providers generally have been proven to have higher measured quality and better outcomes for patients. They also typically agree to lower reimbursements from insurers, which can mean lower premiums and out-of-pocket expenses for consumers.
You’re more likely to see narrow networks — which include narrow pharmacy networks — if you shop for your own health insurance on or your state’s insurance exchange. They’re less common in the plan options provided by private employers.
Advantages Beyond the Savings
The fact that narrow network plans include fewer providers doesn’t mean you’ll be getting lower quality care. In fact, many insurers require providers to have a proven track record that’s focused on their patients’ health outcomes. And they can offer a number of additional advantages, beyond just lower costs:
  • Coordinated care. Working within a single health system can mean better communication between your doctors. You might also have easier access to all your medical records through a dedicated online portal.
  • No referrals. Traditional HMO plans generally require a referral from your primary care physician for any consultations with a specialist. Many narrow network plans eliminate this requirement.
  • Added benefits. Many narrow network plans offer benefits designed to keep high-risk patients healthier. These can include options like free health coaching and live video services that enable remote, online medical consultations.  
Cons to Consider
Of course, the biggest disadvantage to narrow network plans is less choice. Insurers keep these plans more affordable by negotiating lower reimbursements with health care providers. In return, those providers could see patient rosters grow, because smaller networks also mean less competition for those within the network. Smaller networks also can mean:
  • A need to change physicians. Your current primary care physician and specialists might not be included in the plan. This can mean starting over with new doctors who aren’t familiar with your particular health concerns.
  • Longer drives. With fewer choices, you may be forced into a longer commute to see an in-network physician. This could become a hardship for those in rural locations.
  • Lack of specialty options. A smaller network might not include the broad range of specialists large networks typically include.
Plan Ahead
Deciding whether a narrow network plan is right for you and your family requires a little research. Beyond basic premium and out-of-pocket costs, be sure to consider:
  • Network quality. Take time to research the hospitals and physicians included within the plan. You should feel comfortable with the options you’ll have available within a smaller network.
Your current physicians. Check the plan’s online provider directory to see if your current medical team is in the network. If this is especially important, you might want to call your providers separately to confirm that directory information is correct.