Speak with a Covered California certified agent! Call (888) 413-3164 or Shop Online Now

Shop and Compare

California Health Insurance Plans and Rates

It's easy. Just enter your zip code.

Covered California Q&A

Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.

Why are Networks Restricted?

By on | 7 Comments

Question: There has been much talk about restricted provider networks in the Covered California plans. If the plans have to be the same as those offered outside the marketplace, how are they restricted? Or all all individual plans restricted in comparison to group plans? Can you shed some light on this subject?

Answer: Individual plan provider networks have been "narrowed" for 2014 as a way of controlling costs. That's because a smaller number of medical providers are willing to agree to lower contract rates. Carriers who offer qualified health plans in the exchange must "mirror" those plans (including networks) outside of the exchange, so the individual plan networks are identical in the exchange and off the exchange. Group plans will generally have broader networks than individual plans, if not the same as pre-2014.


Here you go. From the PPACA, PL 111-148:

SEC. 1301. QUALIFIED HEALTH PLAN DEFINED. (a) QUALIFIED HEALTH PLAN.—In this title: (1) IN GENERAL.—The term ‘‘qualified health plan’’ means a health plan that— (A) has in effect a certification (which may include a seal or other indication of approval) that such plan meets the criteria for certification described in section 1311(c) issued or recognized by each Exchange through which such plan is offered; (B) provides the essential health benefits package described in section 1302(a); and (C) is offered by a health insurance issuer that— (i) is licensed and in good standing to offer health insurance coverage in each State in which such issuer offers health insurance coverage under this title; (ii) agrees to offer at least one qualified health plan in the silver level and at least one plan in the gold level in each such Exchange; (iii) agrees to charge the same premium rate for each qualified health plan of the issuer without regard to whether the plan is offered through an Exchange or whether the plan is offered directly from the issuer or through an agent; and (iv) complies with the regulations developed by the Secretary under section 1311(d) and such other requirements as an applicable Exchange may establish.

Now, I know the statute does not use the term “mirror”, but how would a plan off the exchange have the same premium if it did not provide the same benefit structure?

There may be something in the HHS Regulations where the term “mirror” is used, but I don’t have a searchable copy of those as a single document, and right now I’m under the gun writing 50,000 word training course for Texas Navigators that is due one week from today. I’m at 22,000 words.

Christina … sounds strange to me, but anything is possible. Did you ask the doctor what network(s) they are participating in? If you can get that information, you should try calling CoveredCA to see about hanging your insurance plan before the Monday 12-23 deadline.

If you cannot make the change before the deadline, you should be able to initiate an appeal after January 1 on the basis that you received material misinformation about the provider network and would not have made that choice of plan had you been provided the correct information.

Just signed up for Blue Shield on Covered California because they said on-line that my current doctors were preferred providers in their network, but when I called the doctor’s offices to verify this, one office told me that Blue Shield does not remove the doctor’s names from their list even if they are no longer preferred providers (which, in this case they are not anymore.) They told me to be wary of the Blue Shield list, as they have tried unsuccessfully for several years to get their name removed.

Wayne, if you are finding “very few general practice doctors in Santa Cruz” it’s because the doctors are choosing not to participate. That’s probably due to Anthem’s unreasonably low capitation and reimbursement schedules, which has forced Anthem to revert to its former higher paying schedules in some regions. Anthem is not your only choice. Blue Shield and HealthNet have very large networks in most of the areas they serve.

This is one of the expected results of the unreasonably high Medical Loss Ratios imposed on insurance companies by the PPACA. Insurance companies have to remain profitable, and it’s not going to be easy — and will eventually prove to be impossible — when faced with only 15% to 20% of premiums available for operations and commissions.

Networks are the same whether on or off exchange. Here’s the link to the network for Anthem IFP plans.


Your comments are not true re. “Carriers who offer qualified health plans in the exchange must “mirror” those plans (including networks) outside of the exchange, so the individual plan networks are identical in the exchange and off the exchange.” Anthem blue cross plans on CC do not have doctors and medical groups that are available to individual plans offered, just checked today 11/20/13. The anthem bronze, silver, etc plans are very restricted in doctor choice and only offer very few general practice doctors in Santa Cruz area. This means you’ll end up going out of network and incurring much greater out of pocket expenses than expected.

I have not found this to be the case with large networks such as Blue Shield, Blue Cross, and HealthNet. Those networks seem to be largely intact.

In some cases, it’s the providers, not the insurers, which have chosen their way out of the HMO networks. Why? To be able to charge full fare to PPO patients who will have larger coinsurance percentages and/or out of pocket limits to contend with. UCLA and most of the UC medical centers around the state have done this.

My personal physician was terminated by one medical group (but not the insurer) because he sold his practice to a competing medical group in the past year. All I had to do was change to a different group to be able to continue to see him.

Have some networks been tailored to fit new plans? Yes, but that’s a somewhat different story. Because insurers can no longer limit annual or lifetime expenses for EHBs, what else can they do to meet 80% medical loss ratios but contract with a smaller number of providers willing to accept limited amounts of money in exchange for slightly higher capitation payments?

This is a game in which there will, ultimately, be no winners. We are more likely to end up with a “single payer” system of national health insurance than to return to the status quo ante of pre-March 23, 2010.

Leave a comment

Do You Have California Health Insurance Questions?

Ask An Expert

View Previous Questions
Call Us at (888) 413-3164

© 2022 California Health Benefit Advisers, LLC
Home / About / Start Shopping / Ask a Question

“Covered California,” “California Health Benefit Exchange”, and the Covered California Logo are registered trademarks or service marks of Covered California, in the United States. This web site is owned and maintained by California Health Benefit Advisers, LLC, which is solely responsible for its content.