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It’s Time to Stop Accepting the Payer-Provider Dynamic as ‘Adversarial’ and Work Toward Alignment

by Heather Bassett, M.D., Chief Medical Officer, XSOLIS 02/22/2023 Leave a Comment

Heather Bassett, M.D., Chief Medical Officer, XSOLIS

Today’s relationship between payers and providers is more fraught than ever. With a history of transactional, often adversarial, fee-for-service contract negotiations, it’s no wonder that the healthcare industry has grown too comfortable pitting payers and providers against each other.

The lack of trust and transparency between the two groups has led to a perceived misalignment of vision. Across the board, the administrative staff has shouldered the brunt of this friction, which in the end affects patient care and revenue growth negatively. A recent study reported that up to 28% of administrative waste could be eliminated each year if payers and providers worked together. 

Both payers and providers have already felt the pinch of clinical staff shortages, but the shared pain points don’t end there. A Kaufman Hall report says that 2022 was the most challenging financial year for U.S. hospitals and health systems since COVID-19, with increased operating costs and a lack of staff resources to treat an increased patient volume. Similarly, payers are under more scrutiny from the Centers for Medicare and Medicaid Services, as more strict audits of Medicare Advantage plans could result in payers repaying billions of dollars. 

Clearly, it’s time to stop framing the payer-provider dynamic as foes to be conquered, and instead, consider the importance and benefits of more collaboration – what could be possible with improved payer-provider relations, and what changes we should make as an industry to help us get there.

Shared Data Views to Bridge the Divide

One of the simplest ways that payers and providers can start bridging the divide is to implement shared data-driven patient practices. 

While the amount of healthcare data is growing exponentially, it tends to be in siloed and disparate places, presenting a significant barrier to usage. For example, payers and providers each use different data sets – payers tend to have historical data driven by claims over a long period of time, while providers tend to have more granular clinical and financial data that updates in real-time.

However, it is not enough to know that informational data silos exist. In a world where faxes still reign supreme and mere “EHR” access is granted through portals – due to lack of interoperability, HIPAA concerns, and more – we must tackle data silos with technology solutions that offer more intuitive, prescriptive, and truly shared data views. 

When payers know what data providers need and vice versa, they can provide each other with what’s necessary to accomplish mutually desired outcomes – a more empathetic approach to data-sharing, if you will, in an environment that each party can equally access, as opposed to proprietary systems. Shared data views, updated in real-time, can also help identify a single source of truth that can serve as the bedrock on which to build trust and eventually payer-provider alliances.

Accelerating Alignment through Advanced Technologies

Once payers and providers establish a foundation of data sharing to lay the groundwork for collaboration, they can implement more advanced technologies. AI or machine learning-driven tools that support the work of both payers and providers can be layered on to accelerate alignment. 

For example, such tools can lessen the burden of utilization management (UM) on administrative staff, a traditionally manual process, that in many ways has become counterintuitive to the very goals UM was designed to accomplish – to ensure appropriate and judicious use of healthcare resources. Specific, but not limited to, UM, payers and providers can leverage predictive analytics within shared, trusted data views to establish agreed-upon thresholds – what is likely to be agreed upon as inpatient versus observation – to automate decision-making. If up to 90% of all services are ultimately approved, we should be using the science of data to work smarter, not harder, to remove unnecessary tasks and administrative waste associated with these processes.

The Business Case is a Clarion Call for Better Tools, Processes

Building and maintaining successful payer-provider alliances are much more than AI technology augmenting criteria-based utilization management solutions, however. Given the current healthcare landscape, as mentioned above with staff and revenue challenges, there is also a clear business case for improvement – and “working together may be the only way forward,” as Kaufman Hall suggests. 

To eliminate the zero-sum game mentality between payers and providers, we must establish new ways for them to approach problems together. And luckily, the tide seems to be turning, with the appetite for improved payer-provider relationships as strong as the need – 92% of provider executives say they desire greater collaboration with payers. 

The healthcare industry must therefore increase awareness and adoption of tools to help deliver on this need, ushering in a new era for payers and providers, where they can be united in their efforts to reduce administrative waste while improving staff productivity and the bottom line, ultimately enhancing the member’s, or patient’s, experience as well. 


About Dr. Heather Bassett

Dr. Heather Bassett has over 20 years’ experience in healthcare and has served as Chief Medical Officer for XSOLISsince January 2013. She leads XSOLIS’ team of physicians and partnered with its data science team to pioneer the Care Level Score(CLS), which combines clinical expertise and data science for a numerical representation indicating the appropriate care status for each patient.

Dr. Bassett earned her Bachelor of Science in biological sciences from Carnegie Mellon University in Pittsburgh, Pennsylvania, and her Doctor of Medicine from the University of Texas Medical Branch in Galveston, Texas, where she worked as a research associate in the field of DNA repair. She undertook her residency in internal medicine at Vanderbilt University Medical Center in Nashville, Tennessee, and worked as a hospitalist at Centennial Medical Center in Nashville for eight years. She is board-certified in Internal Medicine.

Tagged With: AI, dna, Health Systems, Healthcare Data, HIPAA, interoperability, Kaufman Hall, Machine Learning, medicaid, medicare, Medicare Advantage, Patient Care, Payers, physicians, Predictive Analytics, Utilization Management

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