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D o public and private health insurance exchanges present any significant new issues and implications for providers?"

   Russell Robbins
 Russell Robbins

Russell Robbins
MD, MBA, Principal & Senior Clinical Consultant
Mercer

Both public and private exchanges will present many new challenges for healthcare providers. One of the new emerging areas in the market will be the rise of private exchanges. Mercer, as well as other consulting firms, have developed one that will enable employers with an opportunity to continue offering competitive benefits to their employees, which is an important attraction and retention tool, while actively managing spending and reducing their administrative responsibilities. Employees will have access to a broader array of benefits, as well as the ability to tailor those benefits to their particular needs, with the necessary support to make appropriate decisions. Mercer research indicates that 56% of employers are considering a private exchange to provide benefits to their active employees or retirees.

As the market continues to evolve, providers and insurers will need to adopt to new platforms to ensure that the care can continue to be provided in the most timely and cost effective manner without impacting quality.

 Henry Loubet
 Henry Loubet

Henry Loubet
Chief Strategy Officer, Keenan
 

Health Care Reform is changing the environment for providers and as 2014 approaches a new order is becoming more apparent. The opportunities and challenges presented by public and private health insurance exchanges will be among the most transformative. The extent to which Exchanges impact providers' market share and compensation will be key considerations for participation.

Providers may be requested to accept lower compensation to participate in Exchanges be it hospitals or physicians, especially when it comes to the public exchange. Physician groups and hospitals should attempt to be selective in participating in Exchanges. Primary consideration will center on the contract provisions: How restrictive are they? What are the rules for termination and re-entry into the network? Are there additional administrative requirements? Are risk-sharing and gain-sharing equitable?

The Exchanges may also result in market distribution shifts. Providers who do not often serve commercial patients but primarily have served Medicaid patients may expand practices and serve as providers to the Exchange. Physicians especially may need to adapt to different patient expectations for newly insured individuals in the public Exchange

Some of the challenges may be alleviated through innovative Accountable Care Organizations (ACOs), Medical Groups and IPAs could expand practices to serve Exchange patients. These approaches may help with issues of individual practitioners closing to new patients and the burden of investment in Health IT infrastructure. The use of physician assistants, narrow networks, developing new provider partnerships with health plans in smaller, cost effective networks to be lower cost providers, could be another provider strategy for maximizing their potential with public and private exchanges.

We may also see university-based hospitals and physicians expand their practices to serve Exchange patients. It remains to be seen whether some states may request their university health care systems to provide services for the state Exchange. However, there may be an opportunity for the State Exchange to position these large research institutions as key providers to attract enrollment.

 Terri Welter
 Terri Welter

Terri Welter
Principal, ECG Management Consultants
 

The emergence of public and private exchanges presents a myriad of new issues for providers, including increased transparency, operational complexities, and changing reimbursement, to name a few. No change is more paramount, however, than the financial implications anticipated from material payor mix changes. The shift from uninsured to the exchanges and Medicaid coverage, coupled with the complexity of the shift from commercial coverage to the exchanges, puts pressure on providers to carefully assess their situations and the market in order to inform important contracting, partnership, and other organizational decisions. This also exacerbates the continued push for providers and payors to work on getting costs out of the system.

We are seeing many organizations (both provider and payor) express concern about being left out of the exchange market. As a result, they may pursue narrow network strategies without having key information to help inform the constructs of those arrangements. For example, it is still relatively unclear what the risk of the exchange population will be (particularly the public exchange). As a result, both providers and payors should be mindful to design flexible arrangements that give them an opportunity to modify terms as more information is available. Furthermore, strategic, financial, and operational planning has never been more important than it is in anticipation of 2014. Exchange planning should be a central focus.

  Cyndy Nayer
 Cyndy Nayer

Cyndy Nayer
President, CyndyNayer.com
Founder, Center for Health Value Innovation
 

As new rules on the ACA emerge (almost every day), the landscape of who will succeed becomes more sharply defined by the answer to the question: who will adapt most quickly? There are key considerations within the group called "providers" that will determine their success in the exchanges. Exchanges will have defined products that will offer essential benefits, it's true. Yet many employers and other plan sponsors are already understanding that changing beneficiary health behaviors is a long-term, 24/7 job, and these forward-thinking purchasers are already configuring supplemental plans and incentives to drive the behaviors that support better health and productivity.

An emerging trend that's growing rapidly is the direct contracting with providers/clinicians, paying more for coordinated care, efficient and evidence-based care, and risk management techniques that minimize emergency room use and rescue treatments. So, physicians/clinicians with interoperable data registries will become more valuable. Emerging technologies that receive data feeds from the clinician and send telehealth msgs to the patients in the mode preferred (email? text? phone? or?) and with actionable, measurable engagement will support these forward-thinking providers.

1. Considering clinicians (physicians and members of the care coordination teams). Many see the exchanges as individual insurance plans and tending to each individual separately. In the days of Marcus Welby, perhaps, but not in the 21st century. Individuals still have to go to work, to school, be part of community groups, purchase groceries/gas/electricity/etc. Therefore, providers who consider each of these opportunities as a chance to improve health will adapt the quickest and benefit most.

2. Considering hospitals/health systems/integrated delivery systems. Again, some similarities. But it's astonishing to witness the rate of technology acquisition within this group, and then to witness the lack of data sharing that is occurring. Billions of dollars have been invested in health IT that should support rapid data transfer, but the lack of interoperability, of claims that "this is my data" (and not the patients') is stunning. This barrier will come down rapidly as population health across a community takes hold through the insurance exchanges. Those that insist that only "our doctors on our platform" will be able to see the data are creating unnatural barriers that will cause them to lose contracts, and, eventually, lose reimbursement leverage with plan sponsors, including health plans and employers. Those that understand that data is just that--data--and that the real opportunity for data is what is done with it will win the contracts.

Insurance exchanges will be a game changer, though the change will unfold over time. How the rest of the community develops to support better health is where the real gold will be. Engagement, interoperability, and development of risk-management strategies that envelope the total well-being of the community, rather than just "my beneficiaries," will be the marathon winner. This is no longer a 1,2 or 3-year "customer," but a community-based marketplace that will build prosperity on the increased health of the citizens and businesses who reside there. Those that understand this much larger vision will succeed. Those who grasp it early enough will be in the cockpit and benefit from the health-wealth-performance that is created.

  Peter Kongstvedt
 Peter Kongstvedt

Peter Kongstvedt
MD, FACP
Principal, P.R. Kongstvedt Co., LLC
  Because we have very few public and private exchanges in operation, though there are a few, it's hard to predict with certainty what impact they will have on providers. One possibility will be a renewed push for narrow networks. It will be hard to compete successfully in the exchange markets created under the ACA's rules, but one way to do it is with a narrow network product that can offer superior medical management and cost controls. The ACA also has a provision allowing patient centered medical homes (PCMHs) to offer directly in an exchange, provided they meet state requirements for offering coverage. This could open the door to a really narrow network - a single health system option. If the health system knows what it's doing and understands risk, marketing and medical management, it could boost their market share, and could even cross over into coverage for individuals who move between Medicaid and subsidized coverage. It could also sink them if they don't know what they're doing because it's not called risk for nothing.

The exchanges are required to use quality ratings on plans, and if you look at the example that is easiest to build from, it's the CMS stars program for Medicare Advantage HMOs, which contain a lot of measures applicable to providers. Exchanges will also be managing enrollment and eligibility, so while eligibility checking by providers will still focus on communications with health plans, it's conceivable that they will need to add exchanges into that as well. In fact, an exchange might become the best place to determine eligibility for those Medicaid/subsidized coverage individuals already noted. Or it could be a nightmare. Or it could be a nightmare followed by rosy-fingered dawn (shout-out to my man Homer!). Finally, exchanges may be where many individual health care providers, individuals and small groups, buy their own coverage.

Dr. Kongstvedt's response may also be found on his blog: http://kongstvedt.com/kvedtblog/.

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