MCOs need payment reform

February 15, 2009

MCO execs should be looking at payment changes that are win-win for the payer, consumer

Demand for care often exceeds supply, and managed care might feel their members’ pain. Increasingly, subscribers can not find a primary care physician with capacity to take on new patients or can’t get access to services such as elective surgery, according to Computer Sciences Corp. (CSC), a technology provider.

“We actually had that situation in Massachusetts when universal coverage was mandated,” according to Erica Drazen, managing partner. “The first place a patient goes to complain when there are no providers on the plan accepting new patients is the payer.”

One of the key enablers for change to the healthcare system will be reimbursement, according to Drazen.

These include: allowing nurse practitioners and physician assistants to function (and be reimbursed) as PCPs; supporting wellness initiatives, including providing incentives for enrollees and providers; providing incentives for patients and providers for managing chronic care; and supporting efforts to divert emergency department (ED) patients to alternative sites.

“To close the capacity gap, employers, manage care executives, providers, and hospital executives will need to be much more collaborative than in the past,” Drazen says. “One of the keys will be paying for the time and cost of the hospital home’s activities-promoting wellness and managing chronic disease, and to be more flexible about who provides the service. The example of diverting ED patients to a non-ED setting requires the ability to connect with panels of physicians and to know what coverage they will accept. Managed care organizations are one good source of this information. Sharing protocols for utilization management with hospitals would be another example.”