HMO's, What Goes Around Comes Around

Within the past several years, the new buzz word in the group health coverage market and the individual market as well, has become HDHP (High Deductible Health Plan). While this is definitely a legitimate way to market health coverage and develop more cost effective products for consumers, I believe that the carriers have missed another opportunity to achieve the same results without the high out of pocket price tag for consumers.

When the PPO and HMO concepts were first introduced, physician and hospital networks were smaller. This allowed the carriers the ability to negotiate better contracts with these facilities and guarantee them lots of business from their covered members and insureds. Due to demand from some consumers, bad press, and even thrashing from Hollywood movies, the industry moved more toward larger networks and easier access. This is good for some consumers, but not all. The open access, large network concept attracts more utilization and higher priced contracts with providers thus putting great upward pressure on premiums.

Keeping the current trend is recommended, but reintroducing the older models of smaller and more restrictive networks as well as the staff model, is a must. There is too much business being lost without this market, as well as an alternative for the uninsured.

I've been informed by at least one HMO rep to expect this type of market to resurface. I agree.

Any other benefits agents out there, your opinions are appreciated.