Health Plans with More Restrictive Provider Networks Continue to Dominate the Exchange Market

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Narrow network plans comprise nearly three-quarters of the exchange market.

New analysis from Avalere finds that health plans with more restrictive networks, including health maintenance organizations (HMOs) and exclusive provider organizations (EPOs), continue to be the most common types of plans in the exchange market, with 72% of the 2019 market comprised of such plans. The remaining plans are Preferred Provider Organizations (PPO) and Point of Service (POS) plans, which tend to offer comparatively broader coverage.

“Provider networks are getting narrower, which means it is more important than ever that patients understand what kind of plans they are buying,” said Chris Sloan, director at Avalere. “Unknowingly enrolling in a narrow network plan could lead to patients being unable to see their preferred doctor or go to their most convenient hospital.”

The trend toward higher percentages of plans with restrictive networks has slowed (2019 plans have a similar percentage of restrictive networks as 2018); however, the market continues to be dominated by products featuring less choice. HMOs and EPOs are considered more restrictive, or narrow, as they often have fewer providers in their networks and across specialties compared to PPO and POS plans. Under HMO and EPO plans, consumers are generally required to use in-network providers to obtain coverage, while PPO and POS plans typically cover care conducted either within or outside of a provider network.

“Network design is one tool plans use to keep premiums low,” said Elizabeth Carpenter, senior vice president at Avalere. “However, in addition to monthly costs, consumers need to consider whether a plan covers their preferred doctor or hospital before choosing an insurance plan.”


Avalere analyzed health plan information for states participating in the Federally-facilitated exchanges (FFEs) to capture a large sample of plan designs utilized throughout the country in the 2017, 2018, and 2019 plan years. Information on plan type (PPO, HMO, etc.) includes only FFEs. Analysis is based on information from the FFE landscape file and collected from the Covered California 2017, 2018, and 2019. Avalere analyzed the FFE landscape file for 2017 (extracted October 24, 2016), 2018 (extracted October 25, 2017), and 2019 (extracted October 24, 2018).

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