Insurance companies are faced with myriad challenges in today's market, not the least of which is finding how they will both upgrade their IT infrastructure and organizational capabilities in order to effectively execute new payment models.
To help organizations develop a solid framework for these changes, enterprise-class software company HealthEdge will present a session, "Five Steps to Market Reinvention: Supporting ACOs, Exchanges and Other Reform Initiatives," at 7:00 a.m. on Friday at AHIP's Institute 2012.
HealthEdge's Ray Desrochers, executive vice president of sales and marketing, who will make the presentation, recently spent time speaking with Healthcare Payer News Editor Chris Anderson about the challenges faced by private insurers looking to compete in the changing healthcare environment.
Q: You say insurers need to consider change as their friend. Do you think payers have done a good job of embracing this change in order to be effective in the market?
A: I don't. I think that we are seeing a massive amount of angst and anxiety across the market as payers are starting to look up and say 'What is the new world going to look like and what is my place going to be in it?' For so long they were sitting on the sidelines and stuck in this one-size-fits-all style of healthcare. As a result of that they let their technology get to a point where they cannot support these new models. There is a huge disconnect between the technology capabilities as they exist today versus what they will need tomorrow and a huge disconnect between the organizational capabilities, people processes, controls, etc., that they will need tomorrow versus what they have today. I think it is a case of them not seeing the forest through the tress right now. They have really been laser-focused on a couple of items like ICD-10 and have missed the bigger picture.
Q: How far behind are they?
A: Most of the organizations we are talking to are running on infrastructures that are more than 15 years old and in many cases more than 20 or 25 years old. And while those were great in the one-size-fits-all static world of healthcare they really weren't designed with any of these new models in mind. So I think what organizations are running into now is they are starting to understand the enormity of the challenge of moving from the old world into some of these newer worlds particularly as it relates to their antiquated technology platforms.
Q: Is there an effective way for payers to tie in their ICD-10 efforts with preparing for delivery change?
A: Absolutely. ICD-10 isn't a stand-alone remediation effort, but something that is part of a bigger picture. (Companies) are saying they want to support ICD-10, but maybe they want to be ahead a little bit with ICD-11, because nobody wants to talk about it, but that is coming as well. And they want to play in value-based and might want to play in the world of ACOs. If they can group these things together they can get a lot of economies of scale and will find that a lot of the solutions they put in place are the same. They are going to give you a level of agility and a level of flexibility that will accommodate not just ICD-10 but a lot of other (efforts), as well. What we are seeing is a lot of organizations right now using the technology change over that must happen for ICD-10 as a transformative event.