Our last briefing, It Takes Three to Tango, describes how a partnership framework involving carriers, providers, and consumers can be designed to drive improved health outcomes and sustainable financial stability. The collaboration model is comprised of two integrated parts—a Product Structure and an Integrated Operating Model.

Strategy drives structure. Legacy structures traditionally designed to support fee-for-service contracting restrain commercial carriers and provider organizations as they shift towards a value-based model. The engagement channels between carriers and providers are not suitable to handle Alternative Payment Models (APMs). Carriers and providers need to adapt to a new operating model that fosters communication and collaboration between both parties, leading to an integrated partnership that is well positioned to drive long-term, value-based transformative strategies.

Initial versions of commercial APMs resemble “arms-length” contracts with limited integration between carriers and providers, struggling to achieve meaningful or sustainable improvements in cost and quality outcomes.

The shift to integrated partnership models is tied to addressing the challenges from first-generation contractual APMs. Key elements enabling integrated operating models include:

  1. Performance alignment
  2. Aligned benefits and network
  3. Shared governance
  4. Global care management

This shift towards integrated partnerships requires carriers and providers to collaborate, communicate, and integrate so that long-term sustainable cost and quality improvements are recognized. The structure required to execute this strategy must be composed of integrated building blocks:

  1. Foundational – Intended to establish financial alignment, promote strong governance and drive consumer engagement
  2. Execution – drive capability development, resource support and care transformation

Carriers and provider partners should follow a staged roadmap to implement this structure systematically by first building the operating model foundation and then executing highly feasible and focused care transformation initiatives that create early momentum and incentive alignment.
Read more for a deeper understanding of the specific elements within each building block and tactical steps towards building an enhanced and integrated partnership.

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HEALTHSCAPE CAN HELP.

Widespread demand for and adoption of Alternative Payment Models (APMs) signal that they are here to stay. Carriers and providers must now bridge the gap between their potential and the suboptimal historical results. To learn more about how HealthScape can help you do that, contact Dan Delaney at (312) 256-8615 or ddelaney@healthscape.com.