Here’s What You Don’t Know about Fraud, Waste and Abuse

Here’s What You Don’t Know about Fraud, Waste and Abuse

Fraud is different from Waste and Abuse, and most technology solutions don’t adequately address either issue.

Think you know how to manage fraud, waste and abuse at your healthcare organization? CMS doesn’t agree. In fact, the promises of change and reform coming from CMS and GAO suggest that our government doesn’t feel that healthcare organizations are adequately managing fraud, waste and abuse at all. The data we have supports this. FWA estimates are in the billions, with the latest estimates pegging waste at 20-25% of healthcare spending.

Technology and services vendors who sell you components of fraud, waste and abuse management programs are doing you a small disservice if they market it as a total solution. They know as we do that, without system visibility, health plans and managed care organizations can only hope to control FWA – not eliminate it.

We aren’t suggesting that you shouldn’t work with technology vendors and third-party business partners – not at all. What we are saying, however, is that health plans need to do more than casually plug in a piece of technology or adjunct services with the hopes it will improve their FWA efforts. A more robust, proactive method is required to eradicate fraud, waste and abuse in your health organization.

The Confusion Surrounding “Overpayments”

By 2026, at least 7% of healthcare spending is expected to be made up of some sort of overpayments. That’s $400 billion – at least – and only 5% of that is expected to be recovered. But “overpayments” is a broad term that encompasses everything from mistakes to intentional fraud. Though fraud makes the headlines, the greater percentage of cases – and far costlier to the health plan – are incidents of waste and abuse. And they must be handled differently.

Going back to our earlier point, a health plan must be fully aware that programs to manage fraud, waste and abuse are only a piece of the puzzle. The key to gaining traction at your health plan is visibility. This is why CMS and GAO promote interoperability; they understand that with access to a broader picture (one that is accurate in real-time), you are less likely to get hung up in waste areas like administrative complexity.

What is your health plan doing about the 10% of inaccurately paid health claims?

Here’s how you can reduce FWA losses by 40% in one year.

We have explored the differences between fraud, waste and abuse in previous blog articles (here and here). To summarize, the primary difference between incorrect payments is intent. Fraud and abuse are categorized as illicit, but only fraud is recognized as willful. Together, fraud and abuse account for7% of healthcare spending. Waste, however, is excessive cost tied to administrative complexity, poor processes, paying costs to suppliers that are too high, and other wasteful spending practices. Clinical waste alone accounts for 14% of healthcare spending. But these are just examples to showcase the breadth of this problem.

In truth, there’s a lot that many health plans don’t know about fraud, waste and abuse – and it’s costing them millions.

“Fraud, waste and abuse is a huge contributor to unnecessary costs and the rise of spend within healthcare in the U.S.”

Forrester Research, 2019

What You Don’t Know About FWA – And How to Fix It

In order to fully solve the overpayment crisis in America – including fraud, waste and abuse – health organizations need to shine a light on the areas of this problem that remain uncovered. In 2016, CMS estimated the Medicaid improper payment rate at 10.5% or $36 billion.

A good FWA solution, integrated as part of a broader overpayment prevention program, should be able to make quick progress of identifying leakage at your healthcare organization. Here are 6 things you don’t know about FWA – and how to fix them:

Modern Fraud Solutions Combat Modern Schemes

The fragmented capabilities of most existing FWA solutions simply can’t keep up with the increasingly sophisticated schemes that keep emerging. Success is stymied by false positives, deeply hidden issues go undetected, and increasing time to detection and action prolongs losses. Advanced technology featuring predictive analytics promises to be able to analyze the massive amounts of healthcare data, flag likely fraud before it starts, and quickly build evidence needed to bring a case forward. When fully integrated across your health plan’s cost containment efforts, total payment integrity leverages all aspects of your PI program to bring insights that help increase savings, reduce redundancy and improve efficiencies and workflow.

Waste is Eliminated with Efficiency

Health Affairs defines waste as “spending that could be eliminated without harming consumers or reducing quality of care that people receive.” And wasteful spending, by some estimates, can amount to as much as one-third to one-half of all US healthcare spending. Administrative complexity shoulders the majority of the blame, and while it’s true that waste can be complex, the answer is more straightforward. Waste can be eliminated with efficiency. And efficiency is as much as mindset as it is a practice. Health plans that don’t focus on and achieve efficiency in their processes will struggle to combat FWA.

Waste and Abuse Outsize Fraud

Fraud is intentionally “playing the system” to erroneously benefit from it. It’s also rare, making up only 7% of healthcare spending when combined with abuse. But it’s easy for a health plan to be sold on the fear of fraud, perhaps leading to an overinvestment in technology that addresses fraud moreso than waste and abuse (which when combined far exceed fraud in the US). Health plans face increased audits from CMS, so it’s more important than ever to understand what percentage fraud, waste and abuse contribute to your health plan’s own payment rates.

Overpayments are the Bigger Issue

A report released three years ago by Harvard Business Review found that “even if the United States implemented all the approaches whose effectiveness had been measured, only 40% of the estimated $1 trillion of wasteful spending would be addressed, leaving a significant opportunity for innovation in all areas of health care.” The report estimates that innovations could reduce waste by $600 billion alone, presumably betting that healthcare (like many other industries) stands to benefit from technological improvements. Our takeaway from this report? A total payment integrity program must address more than FWA in order to maximize effectiveness. Innovations to reduce waste need to involve broader overpayment-prevention technologies.

Provider-Payer Partnerships Help Combat FWA

“Combating waste is an area that will require collaboration between employers, health plans, patients, and providers. The benefits are worth the effort: improving patient safety and reducing unnecessary health care costs,” writes Mercer US Health News. Working with providers in a meaningful way means treating the relationship as a partnership, one where both parties have a vested interest in resolving or preventing fraud, waste and abuse. In fact, improving this relationship is a top tactic for mitigating excessive prices, the number 2 culprit of waste at $231-241 billion per year. Tighter provider partnerships allow both parties to better tie prices to efficiency, outcomes and a fair profit. 

Reporting Should Be Ongoing – And Shared

Your health plan’s goal should be to transition efforts from post-pay to prevention. To that end, health plans should regularly measure certain metrics (Mercer recommends measures of misuse, over-use, and under-use be built in to provider contracts) but also share their findings. It may be helpful to share certain information with vendors, providers and staff from other departments. If information is shared more freely and interoperability is obtained, we can all benefit from the data that comes from payment integrity programs.

One Solution for All

You’ve likely heard the statistic that for every $1 spent on FWA investigations, more than $4 is recovered. What if you were able to take that investment even one step further? Pareo® was created to do something no other payment integrity solution can: plug in at multiple levels to provide health plans with the total system visibility that’s necessary for eliminating overpayment problems.

Our innovative technology combats wasteful spending by introducing more efficient processes for our clients. These accommodations include:

  • Unique differences by line of business
  • Integrated institutional and provider environment
  • Various payment methodologies: DRG, APC, ASC, per diem, fee schedule, percent of charge
  • Automated medical coding and billing

Talk to ClarisHealth about how Pareo® can transform your health plan’s payment integrity operations.

More from Our Blog:

Here’s What You Don’t Know about Fraud, Waste and Abuse

Here’s What You Don’t Know about Fraud, Waste and Abuse

Fraud is different from Waste and Abuse, and most technology solutions don’t adequately address either issue. Think you know how to manage fraud, waste and abuse at your healthcare organization? CMS doesn’t agree. In fact, the promises of change and reform coming from...

Managing Medical Record Requests a problem? We’ve got the solution.

Managing Medical Record Requests a problem? We’ve got the solution.

How to manage medical record retrieval processes with multiple clinical audit vendors.Is your health plan missing out on the potential of having multiple clinical audit vendors because you’re concerned about overlapping medical record requests? That uncoordinated...

5 Keys to Help Your Health Plan Focus on 2020

5 Keys to Help Your Health Plan Focus on 2020

  No crystal ball needed. Here’s what we see successful health plans doing now to prepare for 2020. It seems like once Labor Day passes, we prepare for the last half of the year no matter what the weather does. Pumpkin everything, dreams of cooler weather and …...

Using API integration to Create a “Central Hub” of Data

Using API integration to Create a “Central Hub” of Data

As API integration becomes the norm, health plans are learning not all health information technology is created equal.

With the release of the 2015 Edition Final Rule, API integration for electronic health records became required. Its direct effect on patients and providers was clear: better access to data for the patient and the provider with the long-term goal of improving interoperability and data transparency. But health plans have just as much to gain from the advances that APIs offer, as long as they’re able to visualize the free flow of data that ensues. 

“The 2015 Edition Health IT Certification Criteria (2015 Edition) builds on past rulemakings to facilitate greater interoperability for several clinical health information purposes and enables health information exchange through new and enhanced certification criteria, standards, and implementation specifications.”

3 Goals of APIs

In the 2015 Edition Final Rule, Don Rucker M.D., National Coordinator for Health Information Technology, set forth three goals for the use of APIs:
  1. “The API criterion requires health IT to provide application access to the Common Clinical Data Set via an application programming interface (API).”
  2. “API functionality will help to address challenges such as the ‘multiple patient portal’ problem by potentially allowing individuals to aggregate data from multiple sources in a single web or mobile application of their choice.”
  3. “APIs need to be standardized, transparent, and pro-competitive. Open and accessible APIs have transformed many industries. We think they can transform health care as well.” 

How API Integration Benefits Health Plans

The government has declared that APIs are a better solution for data interoperability and health information technology than old exchange protocols offer. We often see the benefits of API touted to patients (access to health data is a priority) and providers (tasked with ensuring said access). But health plans are another important stakeholder in this conversation, especially as they move towards transparency and interoperability (read more about regulatory technology requirements in our article “Prepare to Meet the Future with Data”). 

Health plans require discrete data exchanges, “calls” that respond back with the minimum data needed for the task at hand. API integration makes streamlined data access possible, a more elegant solution than outdated, clunky HL7 2.0 interfaces. When a user requests data, API allows that data to be delivered in real-time (as opposed to batch FTP). With quick, secure access to information, health plans are able to break down silos and seamlessly interface between departments, suppliers and providers.

It is understood that API integration promotes innovation; other industries have realized huge gains by using this technology. Similarly, health plans may work with 20 technology vendors (or more) in API-powered relationships that allow organizations to cherry pick applications that are exactly right for them. Rather than tasking your IT department with maintaining multiple, manual data feeds (incidentally creating more data silos), API integration serves as your jumping off point for leveraging advanced technology solutions like NLP. 

Pareo® Acts as the “Central Hub” for your Plan’s API Integrations

Most health plans we speak with already understand, and in fact currently use, API integrations. But many find it difficult or overwhelming to manage the numerous API connections they may use in the payment integrity department alone. Our technology solution, Pareo, works as the central hub for your plan’s API integrations, connecting data points across your health information technology ecosystem in a way that allows you to maximize revenues, create efficiencies, and effectively manage your payment integrity operations

Access to a single, intuitive interface that provides users with the information they need to efficiently perform PI functions offers many value adds for health plans that deploy Pareo. Depending on your health plan’s goals, Pareo can be used to:

  • Improve vendor lift through quicker supplier integrations
  • Manage vendor concepts quickly and easily
  • Automate elements of the claim process allowing specialized workforce to focus on higher-value tasks
  • Improve communication between all stakeholders through bi-directional intelligence
  • Apply innovative technologies to data reporting efforts for immediate access to real-time information — across your entire payment integrity system

On their own, APIs hold promise but lack comprehensive connectivity. With a system like Pareo — the only one of its kind in the market — health plans can leverage their integrations to create a more robust, more efficient digital strategy

Talk to ClarisHealth about how Pareo®advanced payment integrity technology is helping health plans deliver on their most advanced digital strategies..

An Aggressive Plan to Move your Claims Recovery to Prepay Status

An Aggressive Plan to Move your Claims Recovery to Prepay Status

Transitioning more payment integrity operations to internal prepay is more than just a pipe dream for health plans

Transitioning prepay. It’s the holy grail for health plans — and viewed as equally unattainable. And, in the not-so-distant past, this viewpoint would have been correct. But now, with the assistance of innovative technologies, health plans can take an aggressive approach to transitioning claims recovery to an internal prepay model. Here’s a look at the challenge of transitioning to prepay, the solution we propose, and why your health plan can’t continue the business-as-usual efforts in this area. 


The “Challenge”

Historically, health plans applying post-pay concepts in a prepay environment have been mutually exclusive ideas

In today’s market, it’s essential for health plans to get a handle on payment accuracy. But, without the proper technology tools in place, it’s difficult for payers (and other healthcare stakeholders) to gain true visibility into their operations. In the case of third-party technology suppliers, who rely on their partners to perform at peak level, these murky waters may prove especially hard to navigate. 

Without comprehensive insight and management, it is very difficult for payers to move the needle on claims recovery. Especially when attempting to shift claims from post-pay to prepay, though doing so promises improved efficiencies and higher rates of return for health plans. We see two common barriers to making this shift:

  1. Even if your third-party vendors possess the kind of technology that would enable you to move more claims to prepay resolution, health plans have no ability to store the most successful concepts and apply advanced analytics prepay. 
  2. Even if you do have insights, limited data analytics resources prevent you from taking full advantage of advanced technology.

You may know that some health plans have been able to shift claims recovery efforts to internal prepay activities, but do you fully understand how? In part, successful plans achieve this by breaking down data barriers. With the right solution in place, payers can actually overcome the limitations that poor data visibility place on them. 


Why Prepay is an Urgent Concern

Health plans need the efficiencies that comprehensive payment accuracy technology brings, and prepay is an opportunity to make quick strides. 

We get it. You have a laundry list of to-do’s, all vying for top priority. Digital-first strategy, member experience improvements, optimizing costs and outcomes — these are all important goals. But, it could be that a focus on claims recovery gives your health plan the breathing room it needs for these significant investments. And as professional program integrity problem solvers, we think a shift to prepay is a valuable opportunity for health plans looking to gain traction on aggressive payment accuracy targets. 

We aren’t alone in suggesting a technology solution to improve claims recovery (and management in general). Earlier this year, Fierce Healthcare pointed out, down to the dollar, how much it costs a payer to manage claim inquiries. “When a provider contacts a payer to check a claim status, it takes an average of 14 minutes and costs the provider $7.12… multiplied by millions of requests each year, the time and money add up. In 2018 alone, providers made 173 million claim status inquiries by phone, fax or email.” 

Investing in data analytics is a growing trend. In fact, 60% of surveyed health executives say they are investing more in predictive technologies in 2019. Claims recovery will continue to be an important facet of your health plan’s payment accuracy operations. With the right solution in place, the ability to shift to internal prepay concepts will be in your hands. 


The “Solution”: Pareo® is How

With a centralized solution like Pareo in place, everyone can get on the same page, including vendors and other departments responsible for payment accuracy. 

It may take time, it may necessitate a change in how you do things, but we believe all health plans have the opportunity to deploy a centralized solution for payment accuracy (and reap the benefits). Here’s an idea of how a PI solution like Pareo works from a holistic vantage point to quickly turn around recoveries at your health plan: 

Our team works with you to develop a specific implementation and use plan for Pareo that meets (and often exceeds) the goals you’ve outlined for your plan. If shifting to prepay cost avoidance is a goal of your health plan, Pareo is the comprehensive solution that will help you get there.

Talk to ClarisHealth about how Pareo®advanced payment integrity technology is helping health plans deliver on their most advanced digital strategies.

Data Interoperability Solutions Start with the Consumer

Data Interoperability Solutions Start with the Consumer

Why a consumer-first mentality may be the best way to comply with Information Blocking rules.

If we were to ask you what your health plan’s digital strategy is, would you have a ready answer? Don’t worry: this isn’t a pop quiz and we aren’t grading you. We can’t say the same, however, for the GAO. In a  push for increased data transparency, the Information Blocking Rule will affect how health plans operate. But let’s not lose sight of the true goal of this initiative: easier consumer access to their own healthcare data. We know your organization is already passionate about member satisfaction. But here’s why approaching your information sharing strategies from a consumer-first mentality may put you ahead of the curve.

Don’t forget: Pareo® is your key to successfully complying with this and other transparency initiatives as it can integrate with varied healthcare stakeholders through API.

Digital Strategy Relies on the Big Picture

Your response to the proposed Information Blocking Rule will depend on your health plan’s roadmap to digital transformation. Though the proposed rule may motivate or change your health plan’s response to the digital age, chances are you’ve already begun to introduce new technologies into your IT ecosystem. Unfortunately, healthcare as a whole is woefully behind other industries when it comes to digital transformation: A 2018 survey by Ecoconsultancy and Adobe found that healthcare companies were digitizing at half the rate of other industries (7% compared to 15%). 

Even though health plans are entering a sphere where their success will become increasingly reliant on their digital strategy, no one seems to have the key element needed for digital transformation: access to the bigger picture. As in, not one stakeholder in the healthcare continuum has a full grasp on the data. Instead, health plans only have health information related to claims data (at best). Providers don’t have point-of-care access to health information. And consumers – the group driving digital transformation – are having a hard time getting their records at all. 

Consumer access to patient data is the entry-point into this problem. It is the goal that the proposed Information Blocking Rule was built on, and it correlates nicely with other industry goals (improved care, member satisfaction, value-based models). What role, then, do health plans play in providing members access to their data? A big one, according to the GAO. 

The proposed rule “calls on the healthcare industry to adopt standardized application programming interfaces (APIs), which will help allow individuals to securely and easily access structured EHI using smartphone applications.” APIs, like those used by your technology vendors, integrate with components of your health plan data to work effectively. 

Currently, most health plans have no digital management tool to take advantage of available API integrations. But Pareo is the first and only payment integrity technology solution that can plug in to every API in your ecosystem to provide an unparalleled advantage: real-time access to the bigger picture. 


How Pareo Enables Consumer-First Digital Strategy

Health plans are being asked to do a lot. Healthcare is bracing for an unprecedented level of disruption that will require health plans to innovate, and quickly, all while complying with a level of transparency previously unachievable, maintaining strict data security standards, and cutting costs. The concerns and demands surrounding technology can easily send a health plan down a rabbit hole. 

It’s easy to say that the success of technology in modernizing other industries needs to be applied to healthcare. But healthcare is both a public service and a business, highly regulated and running on tight budgets, which means many in the industry wait to implement solutions until they are demanded to do so. It doesn’t have to be that way. 

Consumers require access to their electronic health information. In order to participate fully in the new era of data access, health plans will need secure, free-flowing integrations with providers, payment integrity suppliers, and technology vendors. More importantly, a health plan will need a secure way to manage these digital relationships. At its core, Pareo was designed to do just that, to help health plans swiftly move from having a very narrow view of information, to seeing data visualizations in real-time. This single, powerful transformation will affect every aspect of your payment integrity operations. 

Tracking the proposed Information Blocking Rule

The public comment period for the Information Blocking Rule has closed and lawmakers have suggested delaying a vote on interoperability rules. We are tracking the subject closely and will continue to publish relevant commentary as new information is released: 


Full access to your health plan’s data and digital relationship management primes a health plan for greater success. Pareo is a technology solution that also allows health plans to innovate on existing technologies, applying AI and machine-learning intelligence to data reporting functionality. It also reduces administrative complexity by automating tasks and intelligently flagging claims, freeing up your employees to focus on other, higher-value tasks. Like making members happy, shifting claims to pre-pay rather than post-pay and adding more technology vendors to maximize recoveries. 

That’s the power of Pareo. 

Talk to ClarisHealth about how Pareo®advanced payment integrity technology is helping health plans deliver on their most advanced digital strategies. 

Managing Medical Record Requests a problem? We’ve got the solution.

Managing Medical Record Requests a problem? We’ve got the solution.

How to manage medical record retrieval processes with multiple clinical audit vendors.

Is your health plan missing out on the potential of having multiple clinical audit vendors because you’re concerned about overlapping medical record requests? That uncoordinated approach to medical records retrieval is unnecessary in the modern age of vendor coordination and provider communications. 

For health plans that are ready to maximize their returns, improve recoveries and avoid the abrasion created by redundant medical record retrieval processes, Pareo® is your answer. Pareo is a comprehensive payment integrity solution that works by making data more accessible, connecting it to multiple stakeholders and managing real-time communications (including those related to the claims process and associated with technology vendors). With these efficiencies in place, health plans are able to maximize their recoveries by adding clinical audit vendors. Data is no longer siloed — it can be seen, used and leveraged by health plans. That’s the power of Pareo. 

Overlapping Medical Record Requests Begone

Suppose your health plan were to prioritize adding clinical audit vendors without a broader management tool in place. One of the very real side effects of this practice is overlapping medical record requests. It’s frustrating for everyone, especially providers who seek to prioritize patient care over cumbersome administrative processes. 

In instances where health plans have a lot to lose (recoveries, valuable providers, plan members), clear communication is crucial to success. We understand that our clients need to do more than just talk at stakeholders; they need to intelligently coordinate with vendors, providers and members in a streamlined but meaningful way. 

Unfortunately, some of the payers we speak with feel forced into an impossible decision: improve provider relationships OR recoveries. This approach, while understandable, is unnecessary. What if you could do both? What if expanding recoveries through adding vendors — a smart strategy for scaling health plan payment integrity operations — wasn’t stressful on providers? 

Harmony: Vendor Coordination + Provider Communications

By eliminating the fear of overlapping medical record requests, you are free to stack the best vendors to your advantage. Directing vendors to laser focus on their area of expertise creates more potential for finding anomalies; for example, having vendors concentrate on a line of business (e.g. Medicare Advantage, Medicaid, commercial). Data tells us that any time a health plan adds a vendor in a multi-pass capacity, their ability to increase recoveries improves dramatically. 

But don’t leave providers out of the loop. Health plans often run a planned series of audits that parallel those that a provider performs. With Pareo, each party can be on the same page about these audits; knowledge and understanding of them beforehand can minimize redundancies, says Healthcare Finance.  But as we all know, it’s not as simple as straightforward communication between a payer and a provider. Vendors are an important component as they rely on data to deliver results. 

Enter Pareo Clinical.

Pareo Clinical: Eliminates Risk Around Medical Record Requests + Retrievals

Tackle risk, reduce inefficiencies, increase nurse auditor throughput, improve your net promoter score (NPS) and increase recoveries with Pareo Clinical. Our solution provides gates and custom logic that streamline the medical records retrieval process to coordinate with vendors, eliminate duplicate requests and auto-route submissions to the appropriate auditor with smart tagging so nothing gets overlooked. 

To enhance communication, our solution creates a unilateral or bi-lateral portal of communication for our clients that allows them to not only communicate with vendors but with another very valuable player: providers. We understand that in today’s IT ecosystem, a true solution has to “speak” with multiple stakeholders in a way that removes redundant, wasteful processes. 

Those communications streamline activities that can be automated. But perhaps just as important, Pareo allows for sophisticated coordination between all stakeholders. With our technology, even pending requests — days outstanding, notes on interactions, etc. — can be tracked to prompt proper follow-up strategies. These efficiencies mean more clinical audit vendors and less abrasion with providers. In today’s world where health plans are being asked to do more with less, a scalable, comprehensive solution is the strongest way forward. 

Learn more about how Pareo supports health plans, providers and third-party vendors

Talk to ClarisHealth about how Pareo®advanced payment integrity technology is helping health plans stride confidently into an uncertain future.

5 Keys to Help Your Health Plan Focus on 2020

5 Keys to Help Your Health Plan Focus on 2020


No crystal ball needed. Here’s what we see successful health plans doing now to prepare for 2020.

It seems like once Labor Day passes, we prepare for the last half of the year no matter what the weather does. Pumpkin everything, dreams of cooler weather and … 2020 business planning. That’s pretty much what September will look like for many of us. This is the time of year when many organizations are thinking about the year ahead: making budgets and conducting strategic planning sessions. Where is your health plan heading, and are you looking far enough into the future?

Here are 5 key things health plans should consider as they plan for 2020. 

1. Start with last year’s plan

You’ve done this before — last year, in fact. There’s likely no need to reinvent the wheel as you plan for 2020 (though you may have some new ambitious goals). You can start preparing for next year by looking at your plan for this year and identifying what you know has worked and what hasn’t. Long-term planning in an industry that’s poised for disruption can be tricky, but we know there are a few persistent trends that can be addressed in your business plan:

2. Keep your long-term plans flexible

Disruption is knocking and plans that are inflexible won’t survive the future. You may not be able to plan for every specific change headed your way but you can plan for change. Flexibility is essential to ensuring the long-term plans you make are able to adapt to the coming changes in technology, business models and regulations. 

One business strategist says, “For any given uncertainty about the future — whether that’s risk, opportunity, or growth — we tend to think in the short- and long-term simultaneously.  I build a cone with four distinct categories: (1) tactics, (2) strategy, (3) vision, and (4) systems-level evolution.” Instead of a linear, timeline view — which perpetuates a cyclical tactic-strategy approach — a time horizons “cone” allows you to be more flexible, consistently poised to be ready for whatever the future brings.

3. Avoid the pitfalls of linear, short-term thinking

So, you can’t prepare for every aspect of the future. But that doesn’t mean you should avoid it. Short-term thinking can hinder long-term growth. Making decisions based on immediate needs will not serve you best moving forward. This particularly affects health plans when it comes to recoveries. Health plans may settle for less than what they could be getting because they are hesitant to invest in technology or expanding their vendor footprint because of cost. 

We understand this way of thinking; sometimes it feels like the only way to survive. But saving the tree, only to lose the forest is a mistake health plans can avoid. You may be able to get by with legacy technology and outdated processes for now, but investing capital in innovative technologies can set you up to thrive into the future. 

4. Prepare for innovation cycles

Deloitte’s paper The Health Plan of Tomorrow urges health plans to recognize and prepare for the coming disruption or “innovation cycles,” which they caution happen not all at once but often incrementally. Rather than wait for a huge sign, Deloitte advises health plans prepare now for “radical transformation” by: 

Transforming business models

“In the future, only plans that break down internal constraints holding them back will have survived,” cautions the paper. It’s important for leadership to accept and communicate impending transformation. 

Investing in dynamic technologies

It’s true, legacy technologies have held health plans back. Now’s the time to shift focus (and capital) to futuristic technologies such as: AI and analytics, automation, blockchain, and cloud computing. 

Workforce training and talent

Business transformation means employees will need to be trained in order to use new technologies efficiently. Furthermore, new talent will need to be acquired as new skill sets are required. To support these changes, health plans will be better served by shifting their workforce structure. “Data and analytics teams will no longer be housed within individual functions supporting only one market. Instead, they will sit across functions, feeding data from a multitude of sources to support care and claims teams.”

Dynamic data governance policies and practices

There’s going to be an enormous amount of data to manage in the future, and this requires a “strong data governance philosophy of data acquisition, management, and security,” says Deloitte. Our industry is working quickly to identify and agree on universal standards like Fast Healthcare Interoperability Resources (FHIR), but we aren’t quite there yet. Standards need to be flexible and able to quickly pivot based on new trends in order to survive in the future. 

Risk management

Health plans will rely more heavily on data in the future, which means the need for accurate data is vital. Risk always comes with new business models but in an industry undergoing disruption, it’s essential to closely monitor current risks and predict future ones. Paying attention to regulatory and compliance changes and accepting the evolutionary nature of such policies and plans will be key for health plans. 

5. Master these two skills essential to futurist planning

There are two interpersonal skills that translate well into futurist planning: learning to become a change agent and developing a community mindset. A change agent is “a leader who has the skills to navigate an organization through change management initiatives.” Understanding that change management may be a broader objective at your health plan, consider how equipping leadership with change agent skills may further your goals. 

Secondly, health plan leaders should embrace a community mindset. It’s time for health plans and other stakeholders (like providers and technology vendors) to come together and support one another on initiatives. Shared knowledge is a powerful component of community but there are also professional benefits in finding a support system. It’s easier to plan ahead for the future when we converse with other stakeholders regularly and can understand broader, universal challenges and opportunities facing our industry.

Talk to ClarisHealth about how Pareo®advanced payment integrity technology is helping health plans stride confidently into an uncertain future.