Payers Are Interested In Supporting New Models, But Aren’t Ready

The new HealthEdge State of The Payer survey results revealed that although there is a continued strong interest from payers related to supporting new healthcare business models, the number of people that are ready to support these new models is still lagging.

Although this survey is still open to responses, 100 healthcare payer IT executives already weighed in. The survey respondents selected Medicare and Medicaid expansions, Pay-for-Performance (P4P) and Accountable Care Organizations (ACOs) as the top three models that they are planning to participate in or support over the next three years.

The results showed that respondents are largely ready to support P4P (74 percent), ACOs (52 percent) and Value-Based Benefit Designs (VBBDs) (48 percent). However, only 39.5 percent are ready to support Next-Generation Consumer-Directed Healthcare Plans (CDHPs) and only 46 percent are ready for other models involving new payment approaches.

“As a result, many payers are supporting the models using additional manual processing, which is not a long-term strategy for success. Manual processing continues to increase, particularly as payers try to do things that their legacy administrative platforms were not built to handle,” said Ray Desrochers, executive vice president of sales and marketing at HealthEdge.

Manual processing is very expensive, which only adds to the already strained budget restraints that healthcare CIOs are facing day-to-day. Approximately 61 percent of the survey respondents are paying $6 or more to adjudicate a single claim manually.

Desrochers also commented that HealthEdge is seeing strong payer interest in the pursuit of the individual market on their own versus just through the exchanges. More than 50 percent of the respondents plan to offer products to consumers, with another 14 percent on the fence. This is good news for healthcare solution providers looking to enter the payer market this year and offer these IT executives an in-house data storage solution.

In addition, the survey respondents are overwhelmingly looking at mobile tools to help make connections among payers and members, with 83 percent of the respondents planning to leverage mobile tools for members and 62 percent planning to leverage them for providers.

“There is considerable interest in finding new ways to connect and communicate with everyone involved in the healthcare delivery cycle, and particularly in finding new ways to better link the payers and the members,” Desrochers said.

With the planned adoption of the new care-delivery models, manual processing and mobile tools, new technology will be needed to fill in the gaps that legacy infrastructures will expose. Furthermore, more than half of the respondents are looking to improve internal and external transparency and seek to leverage new technology to do just that. Healthcare CIOs are on the right track, and it is a good time to be an IT vendor in the healthcare space right now.

ACO Model A Major Tech Challenge For Payer CIOs, Says Study

While many healthcare payer organizations plan to participate in the new healthcare business models, specifically Accountable Care Organizations (ACOs), most do not have the technology in place to reach this goal.

According to a recent HealthEdge Payer Market study, 55 percent of the executives surveyed said that they plan to implement ACOs within the next three years. However, 63 percent of those participants also said that they currently do not have the necessary technology to support those changes. HealthEdge surveyed more than 100 IT executives.

“We’ve got this very interesting industry situation where many of the payer organizations out there are quickly realizing that they must participate in the new healthcare business models if they are truly going to compete in the new economy. But at the same time, when the majority of those organizations are looking closer at what it takes to accomplish those goals, they are coming to a different reality,” said Raymond M. Desrochers, the executive vice president of sales and marketing at HealthEdge.

According to Healthcare IT News, there are six technology components that are essential for the successful operation of an ACO at a high level. These technology components are: role-based security, clinical data exchange, data aggregation, performance management, reporting infrastructure and financial infrastructure.

Payer organizations that plan to implement the new business models are going to have to adopt these next-generation technologies in order to move with the changing times in the healthcare industry, whether they like it or not, or whether they are prepared to or not. And, based on the survey data, more than two-thirds of the survey participants stated that their infrastructures are not ready, technologically. This is great news for vendors, like HealthEdge, who are ready and willing to provide those technology solutions.

 “The one-size-fits-all healthcare offerings of yesterday are being rapidly replaced by options that support new levels of individualization, personalization and customization, and new levels of risk-sharing between payers, providers and members,” said HealthEdge CEO Rob Gillette. “Given this reality, it is not surprising that the survey respondents clearly indicated the need for modern technology platforms that will enable them to successfully compete in the emerging healthcare economy.  We look forward to continuing to play a major role in the market’s technology transformation.”

The market’s transformation is a bright opportunity for all vendors in the healthcare IT space, especially for ACO solutions, as it was voted the No. 1 business model to be adopted by the participants over the course of the next three years. Healthcare CIOs need to take some time to begin thinking about their plans for the future and what technology solutions they will need to realize their ambitions. The times are changing—CIOs can either change with them or fall behind the pack.