Managed care has been around for almost one hundred years, at least in theory. When placed up against fee-for-service payment models, however, it was a hard sell. Traditionally, the way that physicians were compensated for their services was a fairly straight-forward invoicing process: they would bill the patient (or later, the payer) for everything they did in terms of diagnosing or treating the patient. Everything.
It’s almost time for open enrollment - and this year, there are some changes to Medicaid that might affect you, depending on what state you live in. So far, states have begun expanding their Medicaid programs, with the help of additional federal funding. This funding for Medicaid expansion is meant to provide assistance to adults who are under 65 years of age, and therefore don’t qualify for Medicare yet, who are at 138% of the poverty level in terms of income.
When we look at the fee-for-service model from only one perspective, it’s easy to condemn it as “the reason” healthcare spending has spiraled out of control. When it comes to how providers bill for services, having the ability to bill for anything and everything could, and certainly did, encourage the ordering of too many tests and procedures, even unnecessary ones. The idea of value-based payment models not only encourages providers to make more mindful choices, but cost-effective ones too. It also challenges healthcare systems, pharmaceutical companies and patients to be even more vigilant about healthcare costs. Fees are relative to each party involved.
When was the last time your organization performed a SWOT analysis? If you aren’t familiar with SWOT (strengths, weaknesses, opportunities and threats) it’s a widely used strategy in many industries, not just healthcare, for identifying areas for improvement. You can break SWOT down even further: Strengths: What sets your hospital apart from all the rest? What can you offer that makes you competitive? Weaknesses: What puts your hospital and employees at a disadvantage compared to other hospitals? What of these factors can you change? Opportunities: How can you show your strengths to others? Threats: What could cause big trouble for your hospital or employees?
Many people who talk about managed care don’t realize that it has actually been undergoing a bit of a renaissance since the late 1980s - and has existed conceptually since the ‘30s. Since the late ‘80s, MCOs have progressed through several phases: Phase 1: Using utilization review and pre-admission certification to manage access to care. Phase 2: The addition of fee-for-service networks and managing benefits. Phase 3: Shift from utilization review to utilization management with an emphasis on the ‘appropriateness’ of care as well as the care setting. Phase 4: The current phase of MCO development, which has only started in the last couple of years, looks at establishing a continuum of services, lessening the tendency for providers to operate in ‘silos’ which has been the dominant structure of healthcare in the U.S. for years.