Does it cost the Doctor to join a network?

UPDATED: Aug 22, 2016

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UPDATED: Aug 22, 2016Fact Checked

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Asked August 22, 2016

1 Answer

Usually, it does not cost a doctor anything to join an insurance network. An insurance network is an organization of doctors and other health providers under the aegis of a particular insurance company. The network is maintained by a particular insurer so as to make sure that they can cover the needs of those insured and to keep the costs in-house; a large network of doctors means that the insurer can recommend a medical provider that is part of its network and thus reduce costs. They can also control the fees paid to the medical provider for services rendered to the insurer, which is another way to help reduce costs.

An insurer thus develops a somewhat symbiotic relationship to its medical providers. The network insures that the medical provider attached to it get work from its referrals; by working together the various providers in the network provide a range of services to those insured by the company. The insurance can thus keep its costs down: The more providers that an insurer has under in its network, the more likely it can provide services to those it insures, and may doing so the insurer can manage the costs associated with all of its various treatments. This ability to oversee its costs means that the insurer can offer its services for the lowest cost possible, which in turns allows it offer its insurance to lowest possible prices.

The medical providers also refer patients to the insurer, thus making sure that the insurer stays in business. By combining efforts with medical providers, an insurance agency can thus spread into new areas and markets. By combining premium care with lower costs and a large network of medical providers, an insurer can keep its own costs low for its care while paying the providers under its aegis competitive reimbursement schedules. Thus the relationship between insurer and provider helps strengthen both, allowing both to prosper.

Answered August 24, 2016 by bergs007

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