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Providers, payors converge on innovation

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Providers, payors converge on innovationProviders and payors, though each plays a different role in addressing health care needs, are in agreement that in today’s environment, all health care organizations must maximize innovation to secure their core mission and survive in this new and ever-changing environment.

That core mission and innovative ideas for achieving it were the subject of an insightful discussion among provider and payor representatives. The mission, common to providers and payors, was summed up by Monica Piñon, Blue Cross Blue Shield of Texas associate general counsel: “Improving patient health — that’s really what we’re all interested in.”

The wide-ranging discussion was a component of Latest Trends and Developments in the Healthcare Sector, the fall 2015 conference in Dallas co-sponsored by Grant Thornton LLP and Haynes and Boone LLP. The panel on innovation comprised Piñon of Blue Cross Blue Shield of Texas, the state’s largest health insurer with headquarters in Richardson; James Blackburn, director of managed care at Parkland Health & Hospital System, a central hospital in Dallas with community-based clinics; and Michelle Apodaca, an attorney at Haynes and Boone, a law firm based in Dallas. The panel’s moderator was Matthew Tabor, senior manager in the Health Care Advisory Services practice at Grant Thornton.

The panel discussion was moderated by Matthew Tabor, senior manager in Grant Thornton’s Health Care Advisory Services.
Of the numerous issues addressed, panelists centered their attention on three trending topics:
  • Consumerism
  • Data
  • Convergence

Consumers and employers are raising, voicing expectations As accessibility to health care choices has risen, consumers have become self-advocates who demand transparency. They are scrutinizing provider and plan options, and organizations are responding by engaging as never before. “Price and competition that wasn’t really there before is spawning innovation in approach to the market and consumers,” said Tabor. “People can switch plans every year at their whim versus their employer deciding where they go.”

This is exactly what Piñon sees in her health plan industry. “People who didn’t have insurance before or it’s otherwise more available to them … are asking more questions about costs, especially now with the shift away from fee for service. A lot of our efforts are going into developing wellness programs and making it attractive to stay with us.” Her organization is “being creative in how we reach out to clients,” she said.

Blackburn concurred: “The provider community is challenged.” Resources must be devoted in order to be successful in meeting expectations — leading to “opportunities for us to make a difference,” he said.

Providers, payors converge on innovationOne way health plans and other organizations are making a difference is providing tools to enhance the ability to compare costs, features and reputations among providers (i.e., hospitals, clinics and physicians). Apodaca pointed to the Texas Hospital Association’s website, which presents contrasts of procedure costs by geographic area. Piñon’s organization offers a cost calculator, as well as staff assistance.

Along with greater transparency in costs and care, organizations are innovating services related to care. A health plan client of Tabor’s has opened centers in members’ communities — some of them rural — to connect consumers to services and providers in a local network. “They’re really invested in that relationship,” he said. Another client’s investment has been in technology. Consumers are offered mobile access to manage their account as they would with their credit card or bank. They can access information and make payments online.

On behalf of the consumers who are their employees, employers are also demanding transparency. They want to be informed about health conditions in the population so they can choose and manage their plans, offer the right benefits and not purchase unneeded coverage. They expect information about costs and are pressing for answers about what’s driving them.

Data answers many questions if properly analyzed This need to know the drivers of costs “leads to data with an exclamation point,” Piñon said.

The need to know extends to all involved. “It’s important as a provider — both hospital and physician — to understand more about what it costs for you to provide the care,” Apodaca said. “You need to know that in order to negotiate with payors.”

Tabor’s health plan client is considering a pilot project to determine how best to share cost information with members. They did a sample analysis of the cost of an MRI in a hospital as opposed to the same procedure in a physician’s office. “More and more members and patients are looking for tools from plans and other entities to help in their decision-making,” he said.

Data exchanges are becoming part of the mix, said Blackburn. They “are going to be very helpful for managing this information” as providers gain ground on taking advantage of the opportunities.

Providers, payors converge on innovationTo gain value from the data, investments will need to be made in analytics — determining goals and measuring results. “You have to make sure that the information you’re collecting and manipulating actually has a purpose,” Piñon explained. “What is the end game? Do you have identifiable and measurable metrics that you can use in order to achieve these shared savings and meet your quality thresholds in order to have a successful alternative to a fee for service?”

In addition to informing on costs, data can identify populations at risk for specific chronic conditions. Members of Piñon’s organization are invited to local pharmacies for biometrics training when data show they are particularly susceptible to a serious condition. At that point, said Piñon, “we want to talk to you.”

Questions arise: No matter the potential value, who should have access to patient data? And how is access controlled? What can payors tell employers about their employee base without violating confidentiality?Questions arise: No matter the potential value, who should have access to patient data? And how is access controlled? What can payors tell employers about their employee base without violating confidentiality? Piñon spoke to that quandary. “We have to be able to balance sharing vital information that’s going to be useful for you, whoever you are — the client or the provider or the insurance company — but also protecting our business’s confidential proprietary information,” she said. “We have to consider, are we dealing with a business associate? Is it a covered entity? If we collect information, what do we do with it? How do we secure it? Do we share it? And then we have to figure out with all the information we collected, how do we translate that to something we can work with?”

With the search for answers to these questions and those about reliability and continuity high in priority, panel members were in agreement that publicly available data are currently not a likely source. Such data are generally outdated because of the length of time it takes to work through the process. Accuracy and timeliness are ongoing challenges.

Convergence comes in many forms, including shared ideas, efforts Traditional mergers within industries (e.g., Anthem and Cigna, and Aetna and Humana), raise the customary concerns for consumers and employers, said Apodaca. “How do they impact us? Are they going to give us better care? Or are they just going to drive up cost because of somewhat of a monopoly?” However, a less traditional affiliation could provide a path to cooperative change, at least at a state level, she said. “I do think that we are going to see some sort of relief — legislative or regulatory — to allow for payors and providers to come together. We have to do something about these laws or else we’re going to be too limited to be able to really be innovative.”

Providers, payors converge on innovationFunctional, if not operational, convergence is already in place. Piñon’s payor organization is collaborating with provider-member Texas Medical Association to address costs, help both sides understand what the issues are, and for the “potential to generate educational improvement,” she said. Some of the common issues are dealing with delivery and payment reforms, examining shared savings, accountable care, global payments and alternatives to fee for service. To develop solutions in this new realm, said Piñon, it will be important to encourage team-based care among physicians and practices while allowing for their continued independence. “It’s really an investment. It’s an investment in relationships, and not only with providers but also members.”

Apodaca looked at health care reform as a whole and the changes it has prompted. “ACA [Patient Protection and Affordable Care Act] really started the train to study these innovative models, and I think we’re going there,” she said.

In the movement to join forces for the common good, Blackburn’s hospital system offers its own health plan. Pros outweigh the cons, he said. “There’s definitely some risk, and you assume that there’s some scale of efficiencies. But really, when you’re talking about engagement with the members, it does help to have financial counselors and schedulers there. What is seen frequently is that the members will migrate to different providers with choices based on the network.”

This makes for different points of view within the hospital walls, Blackburn said. “But at the end of the day, it ends up being more about the patient.”

See Convergence holds allure, risk, governance complexity for providers and payors for further information about convergence.