What does "network" mean in health insurance?

In health insurance, "network" refers to a group of healthcare providers and facilities that have contracted with an insurance company to provide services to its members at negotiated rates. This arrangement allows for a coordinated approach to care and often results in lower costs for insured individuals when they seek care from these participating providers. Networks can include hospitals, doctors, specialists, and other healthcare entities that work collaboratively within the insurance model to manage costs and improve patient outcomes.

The significance of a network lies in its role in determining patient choices and the potential out-of-pocket expenses for members. Typically, members are encouraged to seek care within the network to benefit from lower copayments or coinsurance; seeking care outside the network may incur higher costs or limited coverage. Understanding this concept is crucial for navigating health insurance plans and making informed decisions about healthcare access.