Where the health system-payer relationship is headed

Kate Finke, senior director of managed care at Trinity Health of the Mid-Atlantic, which covers five hospitals in Pennsylvania and Delaware, joined the Becker's Healthcare podcast to talk about the big challenges negotiating payer contracts and where she sees the relationship with payers and employers thriving in the future.

Below is an excerpt from that conversation. The responses are lightly edited for clarity and length. Click here for the entire interview.

Question: What are you spending most of your time on right now?

Kate Finke: Top of mind for me and for so many health systems is the financial strain that the post-COVID era has put on facilities and their operations. I spend a lot of my time outside of the actual contracting on recovery. There's a big emphasis on revenue recovery around the terms of contracts, challenging payer policy changes, addressing the clinical downgrades and denials, and making sure that payments are correct because we want to get every last dollar that we possibly can. We want to make sure we're getting the expected yield from each of our contracts.

When we do our negotiations, we work hard to get those contract language protections so we can go back and challenge the payer on some of the changes they make in their policies. There is a big emphasis currently around the revenue recovery post-COVID.

Q: I can imagine with large health systems it's no small task to really get the operations together and make sure teams are identifying opportunities for revenue recovery. Are there any new trends in policy changes and revenue recovery that are different than before the pandemic began?

KF: There's been much more in the way of payers tightening their policies and making policy changes. This isn't new, but there's movement to more freestanding areas [of care] at a lower cost, and if your organization isn't already invested in those kinds of facilities and operations, you're starting out behind the eight ball. The movement outpatient is really taking off in terms of driving business away from the traditional inpatient facilities, and the hospital-owned outpatient facilities into the freestanding, independent facilities

Q: That makes a lot of sense and is a trend we're seeing nationally. When you look into the future, what growth and investments make sense? What is your strategy for the next two years?

KF: Shifting the payer-employer-provider paradigm. The payer has control over the employer and the provider is currently on the side. There should be a shift in that paradigm. We've already seen that shift begin with direct contracting, which eliminates the payer from that relationship. We are also moving toward a paradigm in the three-way relationship where the employer becomes the driver and the payer and providers have to work together to meet the employer needs for the employees.

There's little to no relationship between the employer and provider currently. That shift to the employer at the top of the three-way relationship is where we're looking to move things down the road and hopefully that means more of a payer-provider partnership. We talk a lot about payer-provider partnerships now, but those partnerships don't include the employer. I think this change in paradigm would really move those partnerships to become more meaningful.

Q: Is there anything else you're excited about today?

KF: The legislation in Pennsylvania around prior authorization requirements for payers is absolutely exciting to me. It is providing specifics around turnaround time requirements and publishing criteria they're using to make the decisions around medical necessity, and more. These are the things we struggle to get into our contracts as protections for the [treatments] we feel the patient needs and getting paid for the right level of care. It's also critical for quality because when you're waiting for these prior authorizations, that means the patient is not moving on to the correct level of care and getting what they need at that moment in time.


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