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When payers know better, they'll do better


Maya Angelou and health insurance companies are rarely--if ever--associated with one another. But I would like to bridge that extremely wide gap and even declare that payers can learn some very important lessons from the sage poet.

"When you know better, you do better" is one of Angelou's famous quotes. It of course applies to individuals' personal lives, but I propose it also holds true across the health insurance industry.

Hear me out: More and more payers are eager to incorporate next generation business models, including accountable care organizations, value-based benefits, pay for performance and consumer-focused care.

"A lot of payers are not only coming off the sidelines on these topics, but they're saying this is a way that we're either going to maintain our position in the market or gain some type of competitive advantage," Ray Descrochers, executive vice president of HealthEdge, told FierceHealthPayer.

In its latest "State of the Payor Industry Survey" results, HealthEdge found a large proportion of the 170 C-level payer executive respondents plan on implementing one or more new program in the next three years. Almost 70 percent said they will participate in an ACO, 65 percent will launch pay-for-performance programs, 58 percent will adopt value-based benefit designs and 48 percent will create consumer-directed healthcare plans.

The problem, Desrochers said, is most payers still don't know enough about these models' specifics to successfully implement them, many of which are quite complicated and intricate to execute.

"A majority of the payers surveyed don't have … the technology, people and processes in place to actually make any of that a reality," Desrochers said. "We have a fundamental disconnect in the industry. And it's not sustainable."

Enter Maya Angelou's wise words. To "know better," or become educated, payers can "do better," or establish models that can lead to their successful transition into the post-reform market.

"Before you consider doing anything, get out there and figure out these models and start to understand what they mean to you," Desrochers recommended. "Once you actually have the information and know enough about what's going on, then you can start to make good decisions and implement a long-term plan that will get you where you need to be."

Such a plan should include, for example, determining which next-gen models are best suited for each payer organization and then figuring out all existing capabilities, including the people, technology and processes, that can help realize these new programs. Then payers can make some determinations around how to put the right processes in place, including whether to remediate, augment or replace existing systems.

The solution, however, doesn't simply lie in automating more of the claims payment process. "I think automation for the sake of automation solves nothing," Desrochers said. "People ultimately have to start off by understanding these models."

But make no mistake: Failing to fully appreciate and learn the value of these next generation business models will certainly result in dire consequences for payers. "Those [companies] who haven't taken the time to understand the complexity of what they're dealing with aren't going to be a meaningful part of the changing landscape anymore," Desrochers warned. - Dina (@HealthPayer)

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