Health insurance companies partner with hospitals, doctors, and other healthcare professionals. Some plans categorize the providers into levels (often called tiers) based on coverage. (e.g.: A Tier 1 often provide provides the lowest member liability; Tier 2 provides the next best member liability, and Tier 3 is the highest member liability.)
Tiered Networks have been established to drive lower cost and better quality, as well as engage consumers in the financial implications of their health care decisions. These networks provide a larger choice of providers for members.