Don't Fear the Payor: Why Hospitals Should Begin ACO Talks With Insurers

Health plans are looking for partners in care coordination, and hospitals should be at the table with payors and engaged in finding solutions to reduce costs and increase quality, according to a recent webinar from Care Team Connect.

Jay Meyers, vice president of business development at Care Team Connect, provided the payors' perspectives on care coordination, noting their reception to partnering with providers right now. The webinar's main takeaway was that hospitals and other providers should not wait for insurers to come to them, but should be actively engaged in care coordination discussions now — while they are still in the works — so not to miss opportunities.

Health plans alone have had little luck bending the cost curve of care coordination, making opportunities for provider-payor partnerships all the more likely. This is especially the case as employers put greater pressure on health plans to control costs. "Health plans aren't quite sure how they'll implement the new world of provider care coordination," says Mr. Meyers. "From recent discussions and experiences, these plans are actively looking to engage and are looking for solutions. Most will admit they don't have all the answers."

This has been especially apparent in the past few months. In January, WellPoint announced plans to increase its regular reimbursement to primary care physicians — paying them up to 50 percent more if they maintain or improve quality. In February, UnitedHealth Group unveiled plans for new value-based contracts for hospitals and physicians, under which providers will be rewarded for high-quality, efficient care and payments can be withheld if certain standards aren't met. Cigna recently said it plans to have one million people enrolled in accountable care organizations by 2014.

Blue Cross Blue Shield, Humana, Aetna and other large insurers have also established their interest in provider coordinated care contracts. A recent survey found 55 percent of payors plan to participate in accountable care organizations — just one type of care coordination — in the next three years. That's not even mentioning patient-centered medical homes, readmission/emergency department pilots, bundled payments and value-based reimbursement models.

A major point for hospitals to consider as they approach payors is to speak to the right person. Health plans are complex organizations, and it may take three or four conversations to find the right person on the team to discuss value-based reimbursement, patient centered medical homes or other care coordination initiatives. The "medical management" branch of most health plans handles reimbursement discussions today, according to Mr. Meyers. He suggests hospitals move beyond your initial contact with the insurance company and find someone who can speak to innovation in payments. "As you start to engage the plan, they'll often start you with their contracting resource," says Mr. Meyers. "Nine times out of 10, that resource isn't focused on this."

Payors are also trying to find the right tools and information required for incentivized and quality-based reimbursement. "Plans were built to keep information on the inside," says Mr. Meyers. "They weren't built to be sharing a lot of data to providers, and they don't talk easily to one another." Information-sharing can often be time consuming and most of what occurs today is spreadsheet-sharing, according to Mr. Meyers. Still, he recommends hospitals reach out to payors today, while they still have an opportunity to influence what tools and analytics payors use to construct payment models.

"I think right now is a very interesting time," says Mr. Meyers. "We're at the tip of the iceberg when it comes to real deep collaboration in this space."

More Articles on ACOs:

Advocate's ACO Stirs Enthusiasm Among Patients, Providers and Experts
Antitrust Issues for ACOs: 4 Things to Know
NEJM: How Will ACOs "Keep Score" of Physicians' Pay?

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