How Hospital CEOs Are Strategizing to Lessen Medicare Advantage's Onerous Impact

Providers' frustration with the private program is palpable, but there are actions they can take to alleviate its consequences.

There's truth is that there's no silver bullet for winning the fight against Medicare Advantage (MA) as a provider.

However, even though hospitals and health systems are at the whims of payers in this struggle, they're also not without recourse to soften MA's negative effects.

It takes, in one part, working on the margins, and in another part, attacking the problem head-on in talks with payers, but there's enough reason for providers to not feel helpless with MA.

In HealthLeaders' The Winning Edge for Battling Medicare Advantage this week, Winona Health president and CEO Rachelle Schultz and Cottage Hospital president and CEO Holly McCormack dove into strategies, both direct and indirect, to help even the playing field versus MA plans.

Here are three ways provider leaders can mitigate the impact of the private program on their organizations:

Reduce administrative burden

One of the biggest issues with MA is the amount of administrative strain it places on providers.

Prior authorizations, delays, and denials are weighing down a workforce that is already stretched to its limits in a post-COVID environment. Hiring more workers to throw at the problem is easier said than done when labor costs are rising and many organizations are opting to trim down.

So, how can CEOs respond?

Leveraging technology, specifically automation, allows providers to fight fire with fire against payers' own fleet of AI, according to Schultz.

Still, the fight is far from a fair one because when it comes to knowing the criteria and algorithm payers use to accept or deny prior authorizations, "there is no visibility to that," Schultz said. "There's no transparency."

Providers are essentially going in blind with their automation, but it's necessary nonetheless to minimize the load on staff.

Getting completely away from the human component right now is impossible though. That's why Cottage Hospital has formed a prior authorization team rather than having that work done by each department, "in the hopes that there can be some recognition of commonality as you prior authorize one procedure versus another," McCormack said.

Work with—or against—payers

The most direct way for providers to truly make up ground in the battle against MA will always be to bring payers to the negotiating table.

Whether it's working to improve reimbursement rates or decrease prior authorizations, hospital and health system CEOs must get insurers to play ball—willingly or unwillingly.

For Schultz, Winona Health found success in opening a dialogue with its main MA plan in the area by letting them know they were open to innovating and realigning on things like new payment models and care delivery to create a more mutually beneficial relationship.

Having that conversation also allows providers to get more insight about payers' decision-making, thought process, and assumptions, creating a fuller picture of what you're negotiating with.

To gain more leverage, hospitals and health systems, especially of the independent rural variety, should also consider forming a clinically integrated network, Schultz said. Doing so will give organizations the scope and scale for payers to be interested in the number of lives that are covered by their MA plans.

There's also the extreme action of threatening and following through with the termination of MA contracts that some providers can utilize to put the heat back on payers.

If you're a big enough system and can survive the loss of patients, it may be an effective method to rid yourself of the headaches that MA can bring. However, Schultz views it as more of a "short-term strategy," while McCormack noted that in small communities, it won't have the impact that a provider would want.

Advocate for reform and educate

At the end of the day, much of the power in how MA is structured is in the hands of policymakers, which is why providers need to be vocal about changes they want to see made.

Advocating for cost-based reimbursement and streamlined prior authorization processes is of the utmost importance, McCormack highlighted.

Schultz also wants to see greater transparency and accountability by payers around access, quality, and outcomes.

"It's making sure that our policymakers are aware of these things that are wrapped up into this and they don't know unless you tell them," McCormack said. "It's making sure that you're involved with reaching out, however that is, with your representatives, whether it's by e-mail or whether it's a phone call or whether it's hosting a legislative breakfast within your organization, because these folks don't know unless we tell them."

At the same time, providers must educate their patients to help them understand what plan is right for them.

"We have just heard so much feedback from patients who felt like they got blindsided by what was covered, what was not covered," Schultz said.

It's not about steering patients to one plan versus another, but about combatting some of the deceptive MA marketing that is out there and giving them all the information possible for them to make the best choice.

Ultimately, providers have to do what they can with what they have until the landscape shifts.

"There's so much dissonance that's happening, but Medicare Advantage is here to stay," Schultz said. "For us, we just have to sort of bide our time and continue to find openings to get in there and you provide care to the people who are under those plans in our community."