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The Big Story: AHA: 78 percent of health systems say their experience with health insurers is getting worse.

  • Most have outstanding claims from 2016 or older; most have hired additional staff to negotiate get care approved and get paid for it…and most of that effort is “unnecessary.”
  • “The degrading relationship is reflected in “inappropriate prior authorization and payment denials results in significant disruption for hospitals and health systems, challenging their ability to continue caring for their communities.”

Not that you need another glowing warning light on your dashboard to signal the challenges to come. The financial performance over the last few quarters, relentless inflation and workforce exhaustion is quite enough.

Still, the AHA’s under-the-hood insight into the growing tensions between health systems and commercials payers grabbed our attention.

Of 700 health systems surveyed:

  • 78 percent say their relations with payers is getting worse.
  • 84 percent say to cost of payer compliance is increasing.
  • 85 percent spend more on staff to deal with it.
  • Most say the extra work is wasted investment as the denied claims were eventually overturned; still, most have unpaid claims from 2016 or earlier.

Yes, yes, we know. There’s a natural market friction in the payer-provider relationship and a one-sided survey can be akin to asking one political party about the other. Nonetheless, the numbers here are stark and the reported tension reported here has a heightened urgency.

It also reveals– through a nice infographic, BTW – the more specific challenges that providers are facing when it comes to payer relationships. Those can be important elements for providers to highlight when sharing – with simplicity and transparency – their story on payer challenges.

The survey nicely draws a direct line from that fragile, often contentious relationship to how the rift can affect patients. It makes the weedy data matter to the people who get caught in the middle when healthcare doesn’t work as it should.

And, frankly, your story should be all about the patients, or it’s not about anything.

Our advice

In short: Work towards fixing the payer-provider relationship. Easy, right? Of course not.

  • Build your story. Which means you know your story. You’ll need the data, of course, but also the story you want to tell to bring the numbers to life. Build it and tell it now before others use their interpretation of your data against you.
  • Show your numbers. We talk often about the need to tell your story. That holds here. But it’s not just the story of the great care your organization provides, but that of your stewardship and money management. Show how you’re using your resources to care for your community. Be transparent. This is important because payers bring an economic message to the fore when things get tense. They take the mantle of patient advocate, working to save people money. The second half of that message is typically to call out the provider for seeking rate increases. You must be ready to talk about money and how it moves – before, during and in between negotiations.
  • Tell the story you’ve built. Educating the public is tough. Educating the media and public offices and the handful of opinion-leaders-who-matter is no cakewalk, but more manageable. Help these key audiences see the impact the current environment has on providers of care and then interpret that for the general public. Talk to them. Use the AHA’s data to show how the tense payer-provider environment is rippling out to patients.
  • Look for kindred spirits. When and where you can, engage with payers. Do it before, during and in between negotiations. Remember that it wasn’t 100 percent of providers reporting declining relationships. There are bright spots. Sometimes there’s nothing you and your team can do to avoid a fight. But even in those moments, know that the future is – has to be – partnership. A dysfunctional system will shatter if those bonds can’t be mended.
  • Have patients’ best interest at heart. This is The One Thing. Walk the talk. What gets people to believe their hospital has their best interest at heart? What they’re told and how they’re told it. How they’re treated when they have a bill. What’s explained beforehand to set expectations about that bill. The quality. The outcomes. Those are the things that build trust and give people a stake in your success.

This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.

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