Health Insurance Exchange & Network Management Solutionsbetterhealth.mckesson.com/wp-content/uploads/Health-Insurance... · Health Insurance Exchange & Network Management Solutions

Health Insurance Exchange & Network Management Solutions

Mike Flanagan AVP, Product Management June 19, 2013

Today’s Presenter

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Mike Flanagan

Associate Vice President of Product Management

McKesson Health Solutions

Health Insurance Exchange Projections

Required Health Plan Capabilities

Network Flexibility is Key

Other Challenges Solved with Network Flexibility

Q & A

Agenda

Insurance Enrollment Projections By 2016, many HIX products will require narrow networks

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Note: Lives add up to more than US population due to Dual Eligible lives and consumers who hold dual coverage.

Source: CMS office of Actuary

Uninsured drops 50% due to ACA

FFS Gov Market up 13%

• Most of growth due to FFS Medicare with

more boomers drawing Medicare benefits

Commercial Market up 17%

• Employer market remains relatively flat

• Managed Medicare down 10% due to parity

of payment laws

• Managed Medicaid up 65% due to Medicaid

expansion

• HIX market @ 22M lives in 2017 – includes

current Individual, Uninsured and Small

Group

Projected Insurance Enrollment 2012 2017

Government

Commercial

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The Models – States Choose Approach

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U.S. Department of Health & Human Services

States using varied approaches for HIX

6 Copyright © 2013 McKesson Corporation and/or one of its subsidiaries.

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TOP 3-5 Health Plans in a State are expected to participate in HIX


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Minimum Plan Requirements1

• Ambulatory patient services, such as doctor’s visits

and outpatient services

• Emergency services

• Hospitalization

• Maternity and newborn care

• Mental health and substance use disorder

services, including behavioral health treatment

• Prescription drugs

• Rehabilitation and habilitative services and

devices

• Laboratory services

• Preventive and wellness services and chronic

disease management

• Pediatric services, including oral and vision care

HIX Minimum Plan Requirements & Plan Cost Sharing

• 60 % of costs covered by the health plan

BRONZE

• 70 % covered by the health plan

SILVER


GOLD


PLATINUM

Cost Sharing Models


1U.S. Department of Health & Human Services

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Market Complexities

No clear standard

Compressed Timelines

Impacts of Newly Insured

Employers’ Strategies?

Payer Challenges

Price Contraction

Network Adequacy

Managing beneficiaries and churn

Manage changes to operations, technology and capital

Health Insurance Exchange Challenges


Health Insurance Exchange Challenges

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Qualified Health Plans must meet network adequacy network standards… • include essential community providers to ensure reasonable and timely access to

a broad range of such providers for low-income, medically underserved individuals

• maintain network sufficient in number and type of providers, including mental

health and substance abuse services, to assure that all services will be accessible

without unreasonable delay

• make network provider directory available to the Exchange for publication online

which must identify providers that are not accepting new patients

…for initial certification and ongoing maintenance

Network Adequacy Regulatory Standards


Health Insurance Exchange (HIX) Challenges


Network Management Opportunity

Closely manage

medical &

administrative costs

to maintain

profitability

Low Price

Nimbly create

narrow but

accessible network

to fit enrolled

populations & incent

to tightly manage

costs (VBR)

Targeted Networks, Flexible

Contracting

Direct to Consumer Model

Compete on Price and Network Quality and Access

• Studies in MA

demonstrate that

while HIX

successfully

increased access,

costs are still

increasing.

• One of the few

levers left to control

costs is steerage

Cost Impact

• Repurposing closed

HMO network as

narrow network for

cost savings

• Need to define

complex

combination of

relationships

between providers

and products and

reimbursement

Network Design

• Uncertain if existing

networks will be

sufficient to handle

the new population

• Looking for ways to

more quickly stand

up a new network,

enroll new providers

- where needed

Network

Operations and

Contracting

HIX Impacts on Network Management Our customers have shared with us…


Need to Efficiently Design & Manage Networks

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Manage quality, access, cost/price, contracts

Design Networks

• Rapidly design and deploy attractive and efficient networks for HIX

• Model complex contract terms & value based arrangements

Bottom Line: Network Flexibility is Essential

Manage Networks

• Single source of truth for provider data

• Align incentives for HIX

Service Networks

• Consistently execute policies, processes & business rules for HIX

• Support provider adoption of HIX design


Clearly, today’s approach is no longer sustainable…

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Manual Load

Manual Load

• New

applications

• PSV

• Add, change,

term

Provider Data

Management Credentialing

Network

Development

Manual Load

Database 1 Database 3

Manual Configuration & Maintenance

Database 2

Increased administrative costs due to inefficient provider and network management processes

Reduced speed to market for new network initiatives

Inability to operationalize complex networks and associated contracts

Mispayments and lower auto adjudication rates due to poor provider data

Network management automation & integration

Provider Data

Management

Credentialing Network

Development

Automated Network Design

PROPRIETARY AND CONFIDENTIAL. Copyright © 2013 McKesson Corporation and/or one of its subsidiaries.

Automated Network Eligibility & Maintenance

Identify HIX providers based upon specific criteria

On going maintenance of HIX network affiliations

Single source of network information for the enterprise and HIX directories

Payment Reform

• Bundled / episodic payments

• Global payment

• Pay for Performance

Employer & Member Demands

• Narrow networks

• Tiered networks

• Customized networks

Care Delivery

• Accountable Care Organizations (ACOs)

• Patient Centered Medical Home (PCMH)

New Populations

• Health Insurance Exchanges (HIX)

• Managed Medicaid / Medicare

Network flexibility can solve other challenges as well…

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McKesson Provider Manager Brings the Required Capabilities

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• Automate network design and

maintenance for enhanced flexibility

• Establish single source of truth

to management and provider and

network related information including

all associations, affiliations,

demographics and reimbursement

data

• Enhance health plan competitive

differentiation in a crowded market

• Streamline network to benefit design

alignment

Required Capabilities

• Reduce medical costs via narrow

networks

• Reduce administrative costs through

the reduction of paper processes and

manual interventions

• Increase speed to market of HIX

offerings

• Reduce claims re-work and manual

interventions leading to improved

payment accuracy and provider

satisfaction

Business Value


Supports:

• Rapid roll out of new health care

innovations

• Network design and delivery

automation

• Alignment of benefit designs with

networks

• Streamlined provider data

administration

Supports:

• Contract management lifecycle

automation

• Rapid roll out of new contracting

initiatives

• Payer-provider collaboration and

provider adoption of new health care

initiatives

Supports:

• Speed time to market with

reimbursement innovations

• Increase payment accuracy and

auto-adjudication rates

• Administrative cost reductions

• Reimbursement lifecycle automation

McKesson Network Management Solution Suite

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Helps health plans cost effectively

drive strategic care delivery &

reimbursement initiatives.

Helps health plans centralize and

standardize contracts while driving

administrative cost reductions.

Helps health plans increase auto-

adjudication rates for new

reimbursement models and fee for

service.

Provider Manager Contract Manager Reimbursement Manager



Questions?

Documents

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