How Value-based Networks Can Help Reduce Health Costs, Improve Care

Holding the line on health care costs has long been an ongoing concern of insurers, employers and consumers. In recent years the use of value-based networks for providers has become more popular. These networks are also sometimes referred to as narrow, tiered or high-performing networks.

Essentially, value-based networks encourage members to utilize the more efficient providers — meaning hospitals or physicians — by either narrowing networks, or by lowering copayments or deductibles for providers in different tiers in the network.

“Value-based networks are a variation on the long-established practice of having one level of benefits for in-network providers and another level for those out of network,” says Andrea Gioia, executive director for Product Innovation at UPMC Health Plan. “The difference is, with a value-based network the member can choose the providers he or she prefers based on the criteria that are most important to him or her.”

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Source: Smart Business Online