3 MLR Questions Payers, Providers Should be Asking
Karen Minich-Pourshadi, for HealthLeaders Media, January 17, 2011
- Where will payers look to find ways to cut costs to compensate for the losses from MLR?
They’ll have to review areas where there are administrative functions that can be cut, as opposed to medical expenses. This could possibly be their call centers or their claims adjudications areas. Also, they’ll need to look at how they spend in those areas and determine if these are areas of core competency or can they improve them through automation, such as creating patient portals so patients can better manage their own care. Lastly, the payers are really going to need to make a paradigm shift regarding how they manage patient’s care—instead of managing chronic care, now they need to focus on wellness and preventative care.
- What are the broader implications of this policy for providers?
Payers are going to need people with different skill sets to work with patients on preventative care, such as life coaches and nutritionists. For insurers this hasn’t traditionally been something they offered as member care—but they’ll need to now. Also, payers are also going to have to work with patients and providers to improve the quality of care and try to prevent illnesses or disease.
The potential ripple effect of this for providers is if the payers are using more funds toward member care then ideally over the long-term it should result in members being healthier. That in turn would result in a loss of inpatient admissions … in theory hospitals should see a decline in those, and it would directly impact their volumes.
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