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How payers and providers can prepare now for increased collaboration

DXC Technology | April 19, 2021

COVID-19 has created a shift in payer and provider relationships and while that will inevitably evolve in the future, payers and providers can implement tactics now to prepare for increased collaboration whether via new partnerships or becoming a “payvider.”

In the Health Evolution webcast Connecting the Provider and the Payer: Business and Platform Strategies for Health Care, Paul Thompson, Vice President of Americas National Sales and Business Development, Healthcare and Life Sciences, DXC Technology, led a discussion addressing this topic, joined by Gianni Piccininni, Healthcare and Life Sciences Industry Leader, Luxoft, a DXC Technology company, and George T. Mathew, MD, MBA, Chief Medical Officer, Americas, DXC.

Thompson, Piccininni and Mathew outlined the following steps to preparing for increased collaboration:

  • Embracing new regulations
  • Plotting a technology roadmap
  • Changing the culture
  • Re-evaluating revenue for a post-pandemic world

“There is an opportunity to redesign for what the actual situation is, versus what the infrastructure that was built 50 years ago was, or for the relationships that were there,” says Mathew. “The phrase that’s been thrown around, I think accurately, is that we did 20 years of innovation in about nine months,” during 2020.

He added that continuing to build virtual health solutions to face COVID-19 and managing through the next year or two will give payer and provider CEOs more insight about which business models and payer-provider combinations will prove sustainable over time.

Embracing new regulations
Thompson says that the convergence of payers and providers was kicked off by the Patient Protection and Affordable Care Act, particularly how the legislation started shifting risk and the payment innovation that came out of the ACA. More recent regulations, including the 21st Century Cures Act, the interoperability and patient access rules from CMS, and efforts to drive price transparency, are all joining existing market forces to increase the gravitational pull between providers and payers.

“The regulations that have come through — interoperability, surprise billing, price transparency and more — they all might have been advantages from a business perspective before,” Mathew says. “But now with this slew of regulation coming through, it may seem like a disadvantage, because you have to invest and you have to make it work. To get to that future state you have to not only have synchrony between your payer and provider, but you need to be able to integrate with other players in the field.”

Additional players can include life sciences organizations trying to innovate by wrapping a service around their products or it can mean integrating systems for digital health services to more effectively compete with Amazon, Walmart, even Best Buy because, Mathew adds, “they’re all going to want to be able to offer an entire view of the patient.”

That has led providers and payers to face a strategic decision: Achieve minimal compliance with the new rules or, instead, create opportunities that the evolving landscape has the potential to enable?

“I think what you’re going to see is a push by the payers to meet those rules, using the APIs to build better capability around disclosing the information, getting it out there,” Thompson says. “It’s really going to drive a give and take with the physician community when payers are giving providers a unified view of information. For it to be successful it will be about complying with the rules and being collaborative.”

There is an opportunity to redesign for what the actual situation is, versus what the infrastructure that was built 50 years ago was, or for the relationships that were there...The phrase that’s been thrown around, I think accurately, is that we did 20 years of innovation in about nine months.

George T. Mathew, MD, DXC

Plotting a technology roadmap
Many existing IT systems currently drag payers and providers down by requiring too much energy and resources to be spent to work together, Piccininni says, which is both a challenge and an opportunity.

“The greatest opportunity that I see in front of us is the reduction of systems and the elimination of duplicated efforts to help payers stay focused on risk to optimize care delivery from a financial perspective, while enabling providers to focus on the best clinical outcome possible for their patients,” Piccininni adds.

To start, Piccininni recommends avoiding point solutions and, instead, implementing open standards-based platforms capable of sharing and ingesting data to support the business rather than deploying technology for technology’s sake.

Mathew adds that executives should be thinking about end-to-end solutions that open new opportunities. “It’s not just adding on a telemedicine service or a care management service — it’s ‘what does my virtual care strategy look like?’” Mathew says.

Looking further ahead on the technology horizon, Mathew and Piccininni suggest that becoming digitally-connected to outside partners will also require liberating you data, which is challenging because it has historically been locked up and few providers or payers have a sense of how to transfer it in ways that focus on the information they really need. When liberating data, it also makes sense how to deliver the data consumers need, including health information and pricing data.

“When you have a vault of information that’s constantly being refreshed, with the provider and some of the at-home monitoring systems, for example, or social determinants of health, and all that data can be processed and presented in a way the patient can make informed decisions you become an ally of the patient,” Mathew says. “If a patient can trust you to give them a view of digital health and digital self they are going to trust you because they don’t have another reliable source outside of what you’re presenting.”

Changing the culture
Thompson says that the way to consider the payer-provider intersection is trying to decide whether it’s a fork in the road or executives are actually bringing those two pieces of road back together. Both avenues start with culture change to move beyond what has sometimes been an adversarial relationship by transforming from two siloed organizations to a digitally connected partnership.

“Having the payer and the provider under the same roof really ends up being, kind of the Hatfields and the McCoys,” Mathew adds. “And it can feel very much like, ‘I do my business my way against you do your business your way.’”

Mathew continues that executives need to manage the change to align all the people involved on the same business models and goals, whether that means improving the health of members and patients, or leveraging technology to create optimal ways of rolling out services.

When changing the culture, executives should anticipate issues with governance, information flowing back and forth between departments or organizations, standardization, interoperability, latency, security and consent regarding how information is accessed by different entities, Thompson says.

“A lot of that comes down to culture. People have their set idea of what their responsibility is and what they need to do. That has to basically be redefined for what the provider does,” Mathew says. “It has to be one entity that then leads to governance. and that leads to defined use cases that go across the organization. It’s one unified business model.”

Re-evaluating revenue for a post-pandemic world
Mathew says that at this point estimates suggest that only about two-thirds of U.S. hospitals will survive the pandemic because so many are heavily dependent on fee-for-service. Even still, the health care system will continue to be tasked with treating people, including those in remote or low-income areas.

The entire industry, of course, is currently focused on the pandemic, treating patients, and shutting COVID-19 down to return to profitable elective surgeries that have been suspended since the outbreak’s early days.

“In the hospital and health system side, finances are going to need to be re-evaluated as they get back on a financial footing and recover from the demands that have been made on the system,” Thompson says. “The payer community is also going to learn a lot about how they were able to interface and help their members during the crisis.”

Payers and providers will likely examine what exacerbated problems throughout COVID-19, what worked, what did not, what was accelerated that should continue moving forward as well as what new opportunities have arisen for working together with new business and technology architectures.

“It’s too early to know whether payers will be buying hospitals or hospitals buying payers, or both forming unique partnerships. It’s still too early to know the exact business models,” Thompson says. “But the seeds of what the future is going to look like are being sown right now.”

Watch the Connecting the Provider and the Payer: Business and Platform Strategies for Health Care webcast here:

About the Author

DXC Technology, Author

DXC Technology, the world’s leading independent, end-to-end IT services company, manages and modernizes mission-critical systems, integrating them with new digital solutions to produce better business outcomes. The company’s global reach and talent, innovation platforms, technology independence and extensive partner network enable more than 6,000 private- and public-sector clients in 70 countries to thrive on change. For more information, visit www.dxc.technology.