A Primer on Managed Care: Multiple Chronic Conditions
tions to enhance their performance by deliver- ing these services. Healthcare organizations are starting to explore addressing social determinants by pro- viding post-discharge meal delivery, transpor- tation to physician appointments, and home modifications following surgery. Physician prac- tices also are beginning to address social needs by providing community-level care-management services through a new fee-for-service reim- bursement opportunity. This has driven health- care and social service organizations to forge mutually beneficial partnerships, while making it more feasible for healthcare organizations to experiment with providing non-medical services and to better understand the effects such provi- Concentrating on improving social determinants of health presents new opportunities for delivering social services. sion has on their clinical, operational, and finan- cial performance. Although there is a strong case that outcomes can be improved, and expenditures reduced through increased investment in social services, financing for such services and programs has thus far come primarily from grants, commu- nity-benefit funding, and waivers. No traditional healthcare reimbursement mechanism for non- medical services has existed. Until now. Beginning in 2019, Medicare Advantage (MA) plans will have the option to cover a wider range of non-medical benefits. This change— part of the 2018 Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act—will reimburse organi- zations for social services such as meal delivery, home modifications, non-medical equipment, and telehealth, which are aimed at maintaining and improving the health and function of indi- viduals with chronic conditions who live in the community.
All of this could be a boon for CBOs already working to address similar needs and provide relevant services, but because the financial in centives are attractive to any organization will- ing and able to offer the right solutions, these new opportunities increase the competitive stakes for established CBOs. The Changing Face of Competition CBOs often look at healthcare providers and pay- ers as potential partners or new clients. Today, CBOs need to view them as potential competi- tors. Pressures to demonstrate positive outcomes and reduce costly medical use increase the likeli- hood that providers and payers will start building their own social service infrastructure, rather than partner with or purchase services from existing social organizations. In one market, for instance, a Medicaid Managed Care plan looking to provide non-emergency medical transporta- tion to its beneficiaries chose to buy vans and hire drivers, rather than to partner with a local CBO already offering this service. In another market, a managed care plan that understood the impor- tance of good nutrition ended an existing pilot with a CBO and began purchasing commercial meals and using its staff to deliver them to older adults living alone in the community. To a CBO leader, a medical−social partner- ship may seem like the logical path forward. But for healthcare organizations, the upside to offering in-house services can outweigh the cost and complexity of managing a successful CBO partnership, provide more control over the risks under which they operate, and allow them to deliver more well-rounded solutions, with improved outcomes. With the right incentives in place, taking social services in-house also means enhanced financial performance. While known healthcare organizations increase the competitive stakes for CBOs, they are not the only players worth watching. As has happened in virtually every other indus- try, changing healthcare system dynamics are attracting non-traditional competitors from
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