|What Keeps Health-Managed Care Executives Up At Night
The challenges and chief concerns of the executives who
lead and manage hospitals and managed care organizations range from
dealing with the implementation of the Patient Protection and
Affordable Care Act, the relationships between payors and providers and
the nation’s current political uncertainty, according to the
results of the "Managed Care Leadership Survey."
Survey participants told us among the greatest challenges facing health and managed care this year are:
- Clarification–resolution of national health
reform in terms of how and when it will be operationalized over the
next two to four years;
- Reconciling the changes pending with healthcare legislation into current practices implementing health reform;
- Political uncertainty;
- Significant changes in the relationships between payors, providers and patients due to health reform;
- Controlling healthcare costs;
- Increases, shifting of costs to patients and providers;
- Decreased Medicare reimbursement;
- Managing through ambiguous legislation; and
- The unwillingness of large payors to negotiate.
"Continuation of the fee-for-service model" is a key
concern, said an HMO manager of business development. "This model has
no cost controls built in and rewards for action, not results. The
inflation that comes from this system is putting negative pressure on
primary care and giving political fodder for solutions that ration
A product development executive with a health plan cited
Medicare changes in payments to managed care as a significant
Costs were cited as a challenge by the executive vice
president of a firm that provides services to managed care companies.
"Costs continue to rise and present ongoing problems regardless of what
eventual impacts arise from reform."
A senior consultant with a consulting firm agreed. "All
the initiatives simply have one time reductions but the consumption
trends continue and obesity/lifestyle is the strongest push."
Tiered networks that exclude academic medical centers
are a major concern for the director of managed care contracting with
an integrated healthcare system. "Patients who sign up for these may
not understand the limitations of their networks. If they do not need
specialized care, then that is OK.
"But if they need the specialized care that only an
academic center can provide either they will not be able to access the
care or they will access it, self-pay and bad debt will rise," he
A hospital director of managed care said, "CPT 10
– the great unknown" was a concern. "It’s hard to predict
impact, and our readiness is also reliant upon the knowledge and
readiness of physicians, including those that are not part of our
A key concern of one survey participant is "managing
through ambiguous legislation. Erroneous conclusions lead to wasteful
and costly efforts."
According to Tony Markey of AudigyCare, a physician
organization, "navigating an increasingly complex morass of entities
both to partner with and as well as to compete against is key [a]
"Since healthcare is regulated at the state level,
it’s extremely difficult to start and run a national program with
standardized features. Concurrent to this, the MANY types of
organizations that can refer patients to us are extremely varied."
The uncertainty of what impacts national health reform
measures, reimbursement, and what coverage mandates, etc., will have on
the industry and economy concerns G. Douglas Atkinson, president and
CEO of a consulting firm.
There is a pressing need for clarification and
resolution of national health reform in terms of how and when it will
be operationalized over the next two to four years, he believes.
"Sustaining current reimbursement requires many internal
changes not yet in place with physicians and infrastructure," offered a
hospital vice president of managed care.
Lawrence Berman, a healthcare attorney and consultant,
said implementing health reform is the greatest concern "because of the
potential upheavals in the existing system, the magnitude of the
changes, and the unsettling political debate keeping everything up in
The unwillingness of commercial payors to negotiate is
the key challenge cited by the director of an MSO central business
Greg Loughlin, vice president of strategic growth with
New West Health Services, believes medical loss ratio restrictions are
the main challenge "because our plan has historically used one line of
business to subsidize another in any given year."
By splitting our blocks of business into separate,
smaller blocks that adds immense variability to our claims, Loughlin
explained. "We may have to pay rebates on one block and take losses on
another - thus losing overall."
The survey was conducted among Managed Care Information Center’s online among subscribers to The Executive Report on Managed Care and the Managed Care Weekly Watch.
For more information on the Managed Care Information Center, www.themcic.com.