What is a network in health insurance?

In health insurance, a network refers to a group of healthcare providers, including hospitals, doctors, specialists, and other professionals, who have contracted with a health insurance plan to provide services to its members at negotiated, typically reduced rates. This network is important because it allows insurance companies to manage costs and assure members that they will receive care from quality providers.

When patients seek services from providers within the network, they usually enjoy lower out-of-pocket expenses compared to going outside the network. Insurance plans often encourage members to use in-network providers to maximize their benefits and minimize their costs.

Understanding networks is crucial for policyholders as it influences the choice of healthcare providers and impacts their overall costs for medical services. Other options describe different concepts; for example, a specific type of health plan that only covers emergency services does not encompass the broader idea of a network. Similarly, a list of available medications under a health plan relates to formularies, while a supplemental insurance program for seniors pertains to Medicare-related products, none of which define a healthcare network.