Los Angeles Times Examines Trend Toward Tiered Hospital Plans
The Los Angeles Times today examines the increased number of health insurers in the state that have established or plan to establish tiered hospital plans (Lieberman, Los Angeles Times, 10/21). Under tiered hospital plans, health insurers require members who receive care at more expensive hospitals to pay hundreds of dollars in additional copayments. According to health insurers, employers that decide to participate in tiered hospital plans can save as much as 20% on the cost of health insurance premiums (California Healthline, 10/16). Health insurers have established the tiered plans to prompt hospitals to reduce their prices to receive a place on their "preferred" hospital lists. For example, Blue Shield of California has established a plan that requires members to pay 30% of their hospital costs, rather than 20%, when they receive treatment at a more expensive hospital. According to David Joyner, senior vice president at Blue Shield, "When we look at hospital costs for an area, we find inexplicable differences between hospitals." However, the Times reports that tiered hospital plans may force members who do not have access to lower-cost hospitals, as well as those whose physicians cannot admit them to lower-cost hospitals, to pay higher copayments. In addition, an increase in the number of members who receive treatment at lower-cost hospitals may leave large academic medical centers and teaching hospitals, which often have higher costs, with the "burden of treating more of the uninsured." Tiered hospital plans also make information more "difficult to sort through and compare" for the average health plan member because each health plan will have different evaluations of cost and quality, according to the Times (Los Angeles Times, 10/21).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.