Understanding—and Adapting to—Managed Care Strategies
It is highly probable that many practices will see their current payor mix change to one in which 80% or more of net patient revenues will be based on negotiated payments,” according to Christopher J. Kalkhof, FACHE, director and national managed care lead, Provider Revenue Cycle Practice, Deloitte Consulting, New York City. That was the opening salvo delivered on October 20, 2008, at the Medical Group Management Association meeting in San Diego during the session, Integrating Your Practice’s Growth and Managed Care Strategies, presented by Kalkhof and Max Ludeke, FACHE, CEO, Doctors Hospital, Houston.
“Whether negotiated managed care organization (MCO) payment arrangements represent a major or a minor portion of a practice’s net patient revenues in its current operating environment, practices should expect significant change between 2009 and 2010,” Kalkhof says. During the session, Kalkhof and Ludeke discussed the favorable and unfavorable consequences of participating (or not participating) in a specific MCO contract.
Desirable consequences of participation in a favorable contract include:
- increased patient volume through a physician referral management program and retention of existing patients;
- the opportunity to negotiate reimbursements and pay for performance at rates that are higher than average;
- inclusion in the MCO’s participating provider lists and Web sites;
- electronic claims payment options, automated eligibility, disease-management programs, and accelerated cash flow;
- MCO group and Medicare benefit plans designed to provide subscribers with financial incentives to use in-network physicians;
- potentially competitive reimbursement; and
- valuable practice-management tools.