Many health systems lag on strategies to take advantage of new open enrollment on health insurance exchanges that could help offset declining revenues from fewer admissions and more care moving outside of the hospital.
The insurance exchanges offer the opportunity for providers to pursue new customers as millions of newly insured enter the healthcare system, many for the first time, through Medicaid and subsidized plans, said a report released Wednesday by PwC’s Health Research Institute. PwC interviewed executives from major health systems that represent 150 hospitals across 25 states as well as hospital associations.
[See also: Federal grants aid implementation of health insurance exchanges]
Health reform “fatigue,” the need to finalize contracts with insurers, insufficient timely guidance and information from regulators, especially around outreach assisters, navigators and certified application counselors, have all contributed to the slow preparations of many health systems ahead of exchanges opening Oct. 1, the report said.
While the newly eligible can be an opportunity for providers, they also present a challenge because many Americans do not understand the basics of health coverage. Consumers may purchase less expensive plans without realizing that it can limit access to certain services and providers, the report noted.
“Health systems that are slow to identify and help enroll the uninsured risk losing a valuable new business opportunity to the competitor across town,” said John Dugan, partner, PwC Health Industries Group and revenue performance management practice lead, in a news release. “… it will be important to develop counselors who can properly educate soon-to-be insured consumers on their insurance options and match individuals to the right type of coverage.”
[See also: For success, hospitals should strategize for health exchanges]
Among the strategies for health systems to get up to speed quickly to attract the diverse mix of exchange customers are:
• Run the numbers. Hospitals should review the amount of charity care they provide and then compare it to the potential new revenue it would receive as patients gain coverage. Include Medicare and Medicaid DSH reductions, lower federal payment rates and public dollars in play under quality reporting programs. Even if a patient enrolls in the lower-tiered option with the highest out-of-pocket expenses, the potential payments may still be better than unpaid care.
• Tap front line hospital staff to become counselors and to conduct one-on-one discussions with patients. Develop exchange training for financial counselors and hospital volunteers or add staff for a limited time since open enrollment ends March 31, 2014. Hospital staff can help identify the appropriate level of care through initial health screenings and predictive modeling. Financial counselors, who are often the first contact a patient has with the hospital, can provide a full picture of expanded insurance options that are available and focus on the patient as a customer.
• Wire into state exchange boards. Stay in close communication with decision makers at the state and federal level and even participate on an exchange-related state task force.
• Target the right audience. One health system is considering sending out a mailer that explains new coverage options to those patients who qualified for charity care previously.
• Plug into local networks. Outreach efforts are more effective if they are targeted, tailored and very local. For example, identify a hospital employee who matches the profile of those eligible for subsidized coverage and who has ties in the community, such as also being a church member, who can share information with that group.
• Target advertisements to radio, television, Internet and newspapers, which combined will reach a large share of those who qualify for Medicaid and exchange subsidies. Advertising can help build brand loyalty.
[See also: Revenue limits, structural changes lower healthcare spending]