{"id":32019,"date":"2024-05-06T15:43:32","date_gmt":"2024-05-06T19:43:32","guid":{"rendered":"https:\/\/avalere.com\/?p=32019"},"modified":"2024-09-23T12:59:53","modified_gmt":"2024-09-23T16:59:53","slug":"health-plans-2030-evolving-operational-approaches","status":"publish","type":"post","link":"https:\/\/advisory.avalerehealth.com\/insights\/health-plans-2030-evolving-operational-approaches","title":{"rendered":"Health Plans 2030: Evolving Operational Approaches"},"content":{"rendered":"

Health Plans 2030<\/h2>\n

This Insight is the first in a new series, Health Plans 2030, that details Avalere\u2019s thoughts on how the health insurance market will shift over the next six years and what plans should consider preparing for now. To receive updates in this series directly in your inbox, complete the form below.<\/span>\u00a0<\/span><\/p>\n

How will today\u2019s operational approaches need to evolve in the future?<\/h2>\n

Plans are increasingly facing operational and regulatory dynamics that will drive up the costs of healthcare administration and services. These dynamics also influence the tools at plans\u2019 disposal to bend the cost curve. Operational dynamics will put negative pressure on plans’ financial results and increasing regulatory scrutiny will pose additional operational risk and burden, change the future tools available, and require new approaches to contain costs.<\/span>\u00a0<\/span><\/p>\n

Table 1. Regulatory and Operational Dynamics Experienced by Health Plans, 2024<\/h2>\n\n\n\n\n\n
Regulatory Dynamics<\/th>\nOperational Dynamics<\/th>\n<\/tr>\n<\/thead>\n
\u2022 2024 and 2025 Medicare Part C and D Rule
\n\u2022 2024 Medicaid and CHIP Managed Care Access, Finance, and Quality Rule
\n\u2022 2024 Interoperability Rule
\n\u2022 2025 Notice of Benefit and Payment Parameters
\n\u2022 Increasing Congressional focus on topics such as prior authorization and marketing
\n\u2022 Office of Inspector General and Department of Justice activity<\/td>\n		\u2022 Rise in healthcare costs due to pressures such as inflation, innovation in healthcare services and procedures, provider dynamics and shortages, and changes in settings of care
\n\u2022 Increase in utilization of services driven by the COVID-19 pandemic
\n\u2022 Decrease in plan payments in programs such as Medicare Advantage<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

To successfully adapt and evolve, health plans should rethink their strategic approaches and, in some cases, create new tools or processes to address costs in a way that promotes holistic member health in a financially sustainable way. Provider contracting and utilization management are two areas we expect to evolve considerably.<\/p>\n

Value-Based Contracting<\/strong><\/p>\n

Value-based contracting (VBC) is deployed to shift from paying for volume to rewarding value. Currently, VBCs often fall short of improving member health and healthcare costs. Plans should consider evolving VBCs to focus on data-driven, measurable improvements in member outcomes. To do so, they will need access to clinical outcomes data and real-world evidence outside of traditional claims data. With new data access opportunities and constantly evolving analytical platforms, plans can invest in tools that turn this data into actionable information that allows them to move away from focusing solely on claims volume and cost reporting. For example, new tools allow plans to report measurable improvement in members\u2019 health outcomes resulting from physician and care team engagement, episodic care programs, and effective management of chronic conditions in more real-time and. These tools are starting to provide insight into future members\u2019 needs.<\/p>\n

Plans can rethink how they construct VBCs to have their intended effect on member health outcomes and healthcare costs considering these new capabilities. They should account for the member\u2019s comprehensive health journey, including the significant impact social determinants of health and disparities in access to care have on members\u2019 health outcomes. Success will lead health plans to further expand their engagement with community partners and develop innovative solutions to address physician\/clinician deserts, data interoperability across the expanded care continuum, an aging population residing at home, and increased regulatory quality requirements.<\/p>\n

Provider Networks<\/strong><\/p>\n

As regulators focus more on provider network adequacy, plans may not be able to rely on conventional methods such as narrow or tiered networks to contain costs. Provider shortages in some geographic and provider practice areas will make this issue more acute.<\/p>\n

Plans may begin delivering services through provider \u201cpods.\u201d In this model, a mix of provider types in a region can be aligned and coordinated to act as referral sources within the pod to offer holistic care to members. For example, plans may build networks that can cover a member\u2019s full spectrum of needs, from primary and specialty care, rehabilitation services (such as physical and occupational therapy), and health-related social needs such as nutrition counseling, financial management, and transportation services. As technology and treatment options evolve, new provider types can be added to the provider mix. This network can be integrated on the back end through contracting and data exchange, or through benefit design such as copayment structures.<\/p>\n

Utilization Management<\/h2>\n

Prior authorization as it exists today will likely look significantly different in the future and could be lost altogether as a tool to be able to manage costs. Therefore, plans need to start planning for how to promote member safety and reduce the utilization of low-value services in new ways.<\/p>\n

Advancements in artificial intelligence can provide opportunities to create efficiencies in utilization management processes. However, they should be implemented with caution and oversight to ensure policies are being accurately administered to the intended criteria.<\/p>\n

Plans should consider further evolving care management programs to support utilization management efforts. Instead of standardized approaches to care management, plans can focus more on member journey maps that dictate how they approach helping members navigate their journey. Instead of standardized utilization management processes dictated by diagnoses, plans should begin to take a dynamic approach to care management that increases and decreases in intensity as members progress through their health journey. This represents a significant change in how plans manage member care and access today and new methods for assessing, tracking, and improving approaches need to be implemented.<\/p>\n

Next Steps<\/h2>\n

As dynamics in the healthcare landscape change, plans should be looking out towards the near future now and chart their course in response. With expertise in healthy market dynamics, Avalere is well-positioned to be a thought partner to strategize around these issues and operationalize changes today that can position you favorably in the future. Connect with us<\/a> to learn more.<\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Health Plans 2030 This Insight is the first in a new series, Health Plans 2030, that details Avalere\u2019s thoughts on how the health insurance market will shift over the next six years and what plans should consider preparing for now. 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