10 Ways to Maximize Opportunities As a Result of Healthcare Reform


By now you, along with every other healthcare executive, have read through the Patient Protection and Affordable Care Act and are trying to determine how to best position your organization through the implementation of the bill over the next four years. Undoubtedly, the decisions you make over the next few months will determine whether or not your company successfully transitions through the most significant changes in our industry since the introduction of Medicare and Medicaid in the 1960s.

While healthcare reform is now a reality, and the broad changes in coverage, payment, access and quality have been delineated, the many federal and state regulatory agencies affected are just beginning the work of turning the bill into policy. When complete, these policies and regulations will affect virtually every health plan operation from product design to payment to quality measurement to marketing and on and on.

How can you possibly plan for a future that is still far from clear? At this stage in the game, we recommend that health plans consider the following ten ways to maximize opportunities from healthcare reform:

  • Develop new competencies: With the expansion of Medicaid and the creation of state insurance exchanges, there will be a number of new competencies required on the part of participating plans.

  • In a number of states, this will include managing care for new populations of Medicaid enrollees, including childless adults.

  • Participation in state insurance exchanges will require expertise in premium collection and marketing, as well as, an understanding of the individual and small group market.

  • A number of grant opportunities will be available that will require partnerships with states and other agencies.

  • Ensure that your program integrity, fraud, waste and abuse detection and reporting capabilities are comprehensive and meet new criteria: Having a comprehensive compliance program integrated into all aspects of your operations will be critical as there will be increase in governmental oversight. Assuring complete transparency in reporting, outcomes, contractual agreements and program integrity will be necessary.

  • Consider entry into the Medicaid managed long-term care market: More states will be moving Medicaid long-term care into the managed care arena. Few companies currently have expertise in this area and, those that do, stand to gain significant reward. As the competencies for managing this program are significantly different than managing acute care, plans that want to participate will need to invest in developing this expertise or entering into partnerships with service providers that can deliver established expertise.

  • Increase your management of medical spend while delivering better outcomes: There will be an increased need to better identify and manage those with complex or chronic conditions. Also, with the addition of the childless adult Medicaid population, there will be an increased need for care that integrates physical health, behavioral health and substance abuse. Ensure that your PBM is fully integrated into your overall medical management strategies and delivering the lowest net cost possible.

  • Reduce administrative costs: Managing administrative costs will need to be a priority as smaller plans will increasingly compete against larger plans with significantly more advanced administrative efficiencies. Identify areas where cost reductions would be possible through outsourcing, group purchasing and/or the use of specialized service providers.

  • If you are not accredited, start the process now: Participation in state insurance purchasing exchanges will most likely require (depending on the state) NCQA or some other equivalent accreditation. If your plan is not currently accredited, serious consideration should be given to beginning this process.

  • Step-up your disease prevention and wellness programs: There will be a significant increase in the focus on disease prevention and wellness programs. This will include the increased use of health risk appraisals and member-specific outreach and follow-up.

  • Understand your options for access to capital: The need for access to capital may become a critical issue as your plan grows and requires additional reserves or to support the addition of new competencies through acquisitions. Non-profit plans often face a difficult time accessing needed capital and should formalize relationships with contributing partners or identify other potential sources of capital (surplus notes or bonds) well before its needed.

  • Investigate the potential of developing an Accountable Care Organization (ACO): While still somewhat in the conceptual stage, its not to early to investigate opportunities to develop your plan into an ACO, particularly if you have existing partner relationships with provider organizations. Fully functioning ACOs will probably require patient-centered medical homes, behavioral health services and the inclusion of palliative care options.

  • Explore opportunities to join or develop a Co-op: Another potential opportunity for non-profit health plans is to become part of a member-run insurance cooperative participating as a "public plan" option in a state's health benefit exchange. There will be federal support for developing these co-ops which may include supporting the transition of current non-profit plans to insurance cooperatives.

We are all faced with challenging times in our industry. We have consulted with a number of health plans, service providers and vendors to assist them in maximizing their opportunities for success. If we can help your organization as you plan for the future, please let us know.

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