Citing Shifting Landscape, Medicaid Insurer Jumps Into Commercial Market

A comparison of monthly premiums for a single 35-year-old (Source: The Connector)

A comparison of monthly premiums for a single 35-year-old (Source: The Connector)

Citing the fast-shifting, post-Affordable Care Act health insurance landscape, Network Health, a nonprofit Medicaid health plan, is branching out into the commercial market. That means individuals, families and small businesses will be able to purchase Network’s less expensive plans — which don’t include hospitals in the state’s most expensive hospital network, Partners Healthcare — through the state’s Health Connector, and through Network Health directly.

Why now?

Well, first of all, the other Medicaid plans in the state — such as Boston Medical Center’s plan — have already done it. Moreover, with the ACA kicking in in earnest next year, all of the insurers are scrambling for market share.

Network Health President Christina Severin said through a spokesperson that despite its history as a Medicaid plan, “we wanted to offer the same high-quality affordable coverage to an even larger percentage of Massachusetts residents, both individuals and through the business communities, and in doing so, expand on our mission to improve the health and wellness of the diverse communities we serve. We are also preparing for changes that will inevitably occur in our market when federal health care reform takes full effect. The Affordable Care Act is changing the country’s health care system, and seeking to make Exchanges more dynamic marketplaces. We very much believe that Network Health’s value proposition is an excellent match with this evolving market place.”

Network Health was purchased by Tufts Health Plan in November 2011, but the decision to enter the commercial market wasn’t a condition of the sale, a Network Health spokesperson said. Rather, it was just a business reality. WBUR’s Martha Bebinger had a few more questions about the deal and here are some answers:

Q: Will Network Health be underpricing Tufts Health Plan and if so, how?

A: NH compared its relationship with Tufts Health Plan to “The Gap and Banana Republic.” “The same company owns two different entities and appeals to different market segments. Similarly, Tufts has a full network, higher price and a more robust offer. We have a narrow network and a slimmer price. We don’t intend to compete but rather appeal to different segments.”

(Just for comparison, the monthly premium for a single 35-year-old living in East Cambridge would be $261.35 under the new NH plan; $333.61 under the Tufts plan and $458.81 for Blue Cross under the “Bronze Medium” category, according to The Connector website.)

Q: How cheap is this coverage?

A: NH said it will be among the most affordable plans. All of the pricing is public and available on The Connector website.

Q: Is Tufts off loading some of the business it doesn’t want to NH?

A: No

Q: Are all the other (MMCO) Medicaid Managed Care Organizations going commercial?

Yes, they all have commercial products.

Nancy Turnbull, Senior Lecturer on Health Policy and Associate Dean for Educational Programs at the Harvard School of Public Health, calls the move “a good development.”

“It will give consumers in the individual and small employer markets another health plan choice, and it will enable people who are members of NH when they are on MassHealth or Commonwealth Care program to keep Network Health if they switch to the individual, unsubsidized market (and the employer market if their workplaces offers NH).”

Here’s more from the Network Health press release:

Network Health, a nonprofit Massachusetts health plan that provides access to high-quality, comprehensive health care coverage for nearly 215,000 Massachusetts residents with low and moderate incomes, today announced that it is entering the commercial health insurance market by offering six new Network Health Choice plans through the Massachusetts Health Connector (Health Connector), the state’s independent health insurance online marketplace and directly through the health plan’s own website. Plans will also be available for selection through the Health Services Administrators marketplace.

Network Health Choice plans will be a new addition to the Health Connector’s Commonwealth Choice program. Through Commonwealth Choice, individuals, families, and small groups can compare plans available from the state’s major insurers and enroll online. The Health Connector helps residents find affordable, quality health plans, all of which have received the state’s Seal of Approval….

Network Health will offer six options within Network Health Choice: Gold, Silver Edge, Silver Complete, Bronze Edge, Bronze Select, and Bronze Complete. These plans allow members to choose a price and plan design that best suits their needs based on desired premiums, deductibles, co-payments and out-of-pocket expenses. Providers and included services are the same for all six Network Health Choice plans.

With Network Health Choice, all members will have access to services from a large and growing network of primary care providers and specialists; doctors and a customer service team who speak many languages; and in-house medical, mental health and pharmacy professionals who work together to coordinate care. Plans include help with nonmedical needs and resources. For managing care around the clock, members have access to a user-friendly website, Network Health Member Connect, and free health support by phone through NurseLine.

Network Health Choice is available starting January 1, 2013, for newly eligible individuals, with coverage taking effect March 1, 2013. Existing Commonwealth Choice members not enrolled as part of a group can select Network Health Choice during the next open enrollment period, which begins July 1, 2013.

Please follow our community rules when engaging in comment discussion on this site.