A Smart Strategy for Medicare Advantage and Beyond

Most health systems face excessive administrative burdens, claims delays and denials, and contract negotiation challenges across the Medicare Advantage and value-based performance landscape—magnified when disruptor entrants and consumer expectations combine to pose an existential threat. To navigate this new landscape, they need to simplify and standardize operations at scale by optimizing actionable data, improving access, adopting actuarial prowess, enhancing consumer and caregiver experiences, securing “gold card” contracts, and capitalizing on their institutional value.

These were the key takeaways from the 2024 Guidehouse Medicare Advantage Summit, which featured panel discussions led by healthcare executives who have made innovative strides toward conquering these challenges. Held May 15-16 in Washington, D.C., the event also included intimate talks with U.S. Rep. Buddy Carter (R-GA), a pharmacist and House Doctors Caucus member who serves as chair of the Domestic Pharmaceutical Manufacturing Caucus, and U.S. Rep. Claudia Tenney (R-NY), an experienced attorney and small business owner who serves on the House Ways and Means and Science, Space, and Technology committees.

The summit was held to build connections among industry leaders, help them better understand the current legislative and regulatory landscape and where it’s headed, share solutions they can adopt to improve health system performance, and offer guidance for policymakers grounded in real-life experiences. Participants ranged from health system CEOs, CFOs, and COOs to senior executives responsible for payer strategies, revenue cycle management, population health, ambulatory care, and value-based care.

Panelists at the event agreed that health systems need to adjust their clinical and operational models as well as the way they approach payer contract negotiations to remain competitive in their markets and meet their mission of serving their communities. Summit panel topics included:

• “Creating a Sustainable Clinical Model,” with panelists Mike Flammini, Chief Business Development Officer, Privia Health; Chris Stanley, MD, President, Populance, Henry Ford Health; and Ben Zaniello, MD, Chief Medical Officer, Best Buy Health
• “Contracting and Securing Fair Payment,” with panelists Brian Donovan, VP, Managed Care & Payer Relations, Inova Health System; and Brian Walsh, VP, Managed Care, Northwestern Medicine
• “Developing a Customer-Centric Strategy,” with panelists Peter Chang, MD, SVP & Chief Transformation Officer, Tampa General Hospital; Margaret McGovern, MD, CEO & Deputy Dean for Clinical Affairs, Yale Medicine; and Conrad Vial, MD, SVP & President, Sutter Health Network

In summarizing the panel discussions, David Burik, partner and Guidehouse Center for Health Insights leader, noted that hospitals and health systems must focus less on the costs of fighting Medicare Advantage-triggered administrative burdens and reimbursement denials and more on achieving improvements that can help position them to better negotiate collaboratively with payers. He encouraged attendees to join “The Three S Club” and focus on simplifying, standardizing, and scaling their clinical models and operations—an approach that offers value across all patient populations.

The Three S Focus Goals

While the organizations that panelists represented vary widely in terms of geographic diversity, payer mix, and clinical and operational models, they agreed on some common goals.

Enhancing access. A broader view of what access means is needed in today’s complex healthcare environment, said panelists. It’s a measure of quality because it impacts the ability for patients to receive care, but it’s also a window into the “customer” experience, where customers are more broadly defined as patients, providers, caregivers, and staff. Panelists noted that it’s important to first understand a health system’s current capacity across primary, specialty, and ancillary care providers, then maximize future capacity through optimized schedules, use of advanced practice providers, and multi-modal scheduling (including easy self-scheduling).

Often a disruptive redesign of standard call centers is needed, panelists advised. Examples include creating an experience center that proactively engages patients and uses technology to enable scalability, and transforming transfer centers to ensure hospitals aren’t turning down patient transfer requests solely for administrative reasons. Other innovative care models such as virtual primary care, remote patient monitoring, and hospital at home should also be deployed to increase access. And friction can be removed for patients by establishing a closed-loop referral process that embeds clinical triage, eConsults, disease-specific diagnostic ordering criteria, and prior authorization processes.

Leveling the actuarial playing field. Health systems need to develop and rely on sound actuarial values as much as payers do. Having regular access to real-time, actionable data positions health systems to achieve optimal pricing on the front end instead of worrying so much about value-based payment reconciliation on the back end. Panelists discussed the benefits of:

• Validating payer settlement and reconciliation processes to ensure alignment with underlying claims data
• Calculating key Medicare Advantage factors, including non-mandatory supplemental benefits
• Projecting future performance based on changes to CMS-HCC v28 requirements, STAR rating methodology, Medicare Advantage rates, supplemental benefit costs, and utilization data
• Predicting performance through simulation modeling on existing and proposed contracts

Making the caregiver experience easier. Summit participants were encouraged to implement a care model that enables advanced practice providers to work at the top of their licenses, reduces provider administrative burden, and fully leverages clinical and non-clinical resources. One organization, for example, has been improving disease burden capture by creating a centralized problem list that advanced practice clinicians have prepopulated and preprompted so that primary care physicians (PCPs) can assess and validate problems in 20 minutes instead of 60—freeing up two more 20-minute appointment slots and achieving closer to 100 percent disease burden capture at the same time. Digital and AI technologies can also be used to reduce time spent transcribing notes, responding to messages, and renewing prescriptions.

And technology can help minimize the discord between primary and specialty care caused by access issues such as long waits to see a specialist. In Best Buy Health’s care model, for example, specialists can see results from in-home monitoring of blood pressure, glucose levels, and other vitals in the EHR—and that means ultimately they can see the patients who need in-person care, thereby reducing wait times. That lessens the burden on PCPs to manage patient conditions requiring specialty care.

Mastering a data tsunami. Too many health systems are overwhelmed with obsolete clinical data and information they don’t know what to do with. To harness these massive waves of data, experts recommend:

• Establishing an enterprise performance management system that directly connects frontline staff activities to budget and scorecard outcomes
• Engaging providers to have them identify what data is important and should be contained in the EHR
• Understanding root performance issues by analyzing statistically based, clinically driven datasets that combine EHR, payer claims, and other relevant data sources
• Integrating existing data with new external sources (such as patient vitals gleaned from in-home monitoring) to better inform care delivery and operating discipline
• Resetting expectations for what data should be shared and how often, especially since the advent of remote monitoring can offer thousands of data points in a single day that can overwhelm practitioners if not properly managed

Negotiating win-win terms. With at least 30 Medicare Advantage contracts being terminated in recent months, value-based payers may be more open to collaborative contract negotiations. To reduce administrative costs and yield higher returns, health systems should:

• Quantify utilization management and payment practices by payer, compare initial and final denial rates by service, then bring hard data and compelling clinical anecdotes to the negotiating table to illustrate the heavy burden and substantial costs they incur to obtain payment
• Engage payers in preferred partnership models that include gold-carding, unit rates, risk adoption, data sharing, operational integration, and growth initiatives
• Prioritize preferred partner payers while maintaining a strong patient engagement and retention focus to avoid disrupting continuity of care and doctor-patient relationships

Demonstrating institutional value. Because health systems build hospitals to serve communities and last for generations, they are needed institutional stewards that offer stability. Margin-seeking market entrants, on the other hand, are often focused on specific components of the care continuum, moving quickly but only staying as long as profits remain. That’s why it’s important for health system leaders to underscore the value of institutions and drive more access across the continuum of care to allow for higher quality and reimbursement, said panelists.

Instead of siphoning off patients to convenient care that disconnects them from their PCP, innovations are needed to support dollars returning to the core system and to strengthen the patient-primary care relationship. Pursuing strategic partnerships with non-institutional entities such as venture capital firms to acquire new capabilities and act more nimbly can bolster viability without abandoning that stable, institutional foundation.