The convergence of payer and provider organizations has given rise to “PAYVIDERS” – a portmanteau that continues to gain popularity in the healthcare industry. This two-part series highlights success strategies for these organizations. In part one, we reviewed the history and rise of PAYVIDERS in today’s healthcare market. In this final installment, we reveal winning strategies successful organizations use to implement new regulations, payment models and technology mandates as well as incentives for promoting greater efficiency and improved outcomes. When properly executed, these strategies are preparing the concept of PAYVIDERS to be a gamechanger for the healthcare industry.
The PAYVIDER Market Opportunity
PAYVIDERS have entered the market with a focus on a specific line of business: Medicare Advantage (MA) and Managed Medicaid. This market is growing rapidly as the government continues to shift to value-based payment and aging consumers seek benefits such as one-stop solutions with limited out-of-pocket costs, lower premiums and expanded coverage for dental, vision and wellness programs. By creating a PAYVIDER organization, large healthcare providers are well positioned to achieve the operational efficiency and population health management needed to offer competitive premiums to these consumers. Recent data indicate a strong market for PAYVIDERS that serve this segment of the population. Out of 49 million beneficiaries in the U.S., 20 million are already enrolled in MA plans and this number is expected to reach 38 million by 2025.
In parallel, the Department of Health and Human Services (HHS) is accelerating the implementation of value-based payment programs. They are on track to tie 50 percent of payments from traditional Medicare benefits to value-based payment models by the end of this year. It is understandable why more healthcare organizations are considering entering the PAYVIDER market.
Four Winning PAYVIDER Strategies
To successfully adopt a value-based care model, healthcare organizations need to reorganize their healthcare business, analyze quality metrics and realign technology strategies around efficiency, cost and interoperability to support new business and payment models. Similarly, PAYVIDERS emerging as new players in a market can use these four winning strategies to gain maximum market share:
- Invest in technology and operations infrastructure. Supporting activities such as clinical and claims data collection is critical to success of PAYVIDERS. They need strong provider data collection practices supported by Hierarchical Condition Category (HCC) coding, clinical documentation and information exchange. Systems must enable MA plans to accurately project and defend risk adjustments, accruals and bonus payments.
- Develop strong population health management (PHM) models and medical risk management programs. An effective PHM program must include strong data collection and information exchanges that enable advanced informatics and clinical analytics. These capabilities allow organizations to accurately identify high-risk patients and populations, measure medical risk within a defined population and use predictive analytics to identify future opportunities for improving medical risk management. This empowers healthcare systems to control the health plan costs that comprise 85 percent of the premium. The resulting medical cost reductions impact net savings as well as Provider-Sponsored Plan (PSP) premiums, membership retention and overall financial performance.
- Adopt integrated and direct communication strategies. Communication with members is critical to provide valuable cost-saving medical education that ultimately builds brand loyalty. Strong patient outreach and education results in better member engagement in chronic disease management and prescription medication adherence programs that can reduce costs and improve quality.
- Educate and ensure effective workflows. PAYVIDERS have a unique advantage with full access to both payer and provider data. Combining revenue data from the payer side with relationship and clinical data from the provider side helps PAYVIDERS educate their teams more effectively. This enables more complete workflows, timely cross-communication among stakeholders and gap identification and elimination. Engaging with providers on an ongoing basis and enabling them to close gaps within their current workflow in an automated and highly communicative way goes far beyond mere participation in quality improvement programs. Instead, Quality Initiative Programs harness data in rich and meaningful ways that give PAYVIDERS critical insights into operational, financial, and clinical gap areas, helping to propel them forward in meaningful and noticeable ways.
Gain Competitive Advantage in the Market
Health systems seeking to implement a successful provider-sponsored health plan must establish robust processes to meet population health models, care coordination objectives and performance within quality program initiatives, such as CMS STAR. This creates a competitive advantage over other health plans in the market, including local and regional plans. Add to that patient-centered wellness programs, healthcare analytical solutions, care management processes and keen involvement of healthcare leaders in the decision-making process – it’s a recipe for success.
Successful PAYVIDERS can then redistribute the cost savings and higher profit margins as lower premiums to health plan members. Healthcare systems who create compelling value propositions, diligently manage risks and deliver effective services can thus become one of the leading PAYVIDERS in their markets.
Dolita Bhagat is a Healthcare Consultant at CitiusTech.
Dolita Bhagat has seven years of experience in strategic market research analysis, data analytics, and product strategy for the healthcare industry. She currently works for CitiusTech as a Healthcare Consultant. As part of the Product Management team, she’s worked on various innovative Business Intelligence and Analytical solutions for both providers and payers, including CitiusTech’s flagship product BI-Clinical. Previously, Dolita worked as a Market Research Analyst and has a profound understanding of the healthcare IT market, trends, and competitors. She earned her MBA from Pune University and M.Sc. in Biotechnology from Punjab University.