What does 'network' refer to in health insurance?

In the context of health insurance, the term 'network' specifically refers to the set of hospitals, doctors, and other healthcare providers that offer services to policyholders of a specific health plan. This network is established by the insurance company, and it typically includes a range of providers who have agreed to provide services at negotiated rates. When insured individuals seek care from providers within this network, they generally benefit from lower out-of-pocket costs compared to seeking care from out-of-network providers, who may not have a pre-negotiated contract with the insurer.

Understanding the concept of a network is crucial for navigating health insurance, as it directly impacts access to care and financial obligations. It is important for policyholders to be aware of their insurance plan's network in order to make informed decisions about their healthcare options and costs.