Insights

Healthcare payers often carve out specific healthcare benefits that their members receive, such as transportation, dental, vision, and behavioral health services, to other entities who specialize in these benefits (delegated entities). Sometimes, they also bring these benefits back in-house from the delegated entity, which is often referred to as carve-ins. These carve-ins and carve-outs of benefits are typically driven by mandates from state and federal regulations, cost optimization strategies, or service quality considerations.

Planning and implementing a carve-in or carve-out is a complex undertaking that involves almost every department within a healthcare payer and numerous external entities. Therefore, planning these projects meticulously and implementing them correctly and comprehensively is vital. Failure to do so will lead to unwanted outcomes such as non-compliance, member dissatisfaction, provider aberration, and, potentially, financial losses.

Anoteros has helped several local and national payers with these types of projects both on the clinical side (Care Management, Utilization Management, Appeals and Grievances Management) and the administrative side (Member Services, Provider Services, Claims, etc.). Our approach is driven by our deep understanding of the healthcare payer space and our experience planning, implementing, and monitoring benefit carve-ins and carve-outs. This Insights article focuses on the critical clinical areas impacted by such an initiative.

There are six critical areas of clinical focus when a payer decides to carve in or out benefits. The payer and the delegated entity need to discuss and agree on these critical aspects with a shared understanding of the current and post-implementation states to ensure continuity of services and a well-managed transition that does not negatively impact the member.

Member needs identification:

Identifying member needs for the service is a critical component for success. For example, Anoteros recently assisted a health plan client with an initiative to carve-in behavioral health services. Member needs for behavioral health services are identified both proactively and reactively. Proactive identification methods include assessments and screenings during member onboarding, ongoing member contacts, and special events. Reactive identification methods include analyzing enrollment and risk data, monitoring service authorizations, and reviewing member claims. Existing identification methods should remain intact after the carve-in and carve-out process, and additional methods can be identified.

Care model development:

Care model development is designing proactive and reactive intervention methods for specific healthcare needs to ensure better health outcomes and regulatory compliance. Regulatory requirements and industry best practices often dictate the design of care models. While carving in and out benefits, payers and delegated entities should use the opportunity to analyze historical data and refine the existing model. It is also essential for the organization taking over management of the benefit to understand the pros and cons of the model and how members adapt to it.

Care management and Care coordination:

The care model is the basis for managing the member’s care and coordinating their services. Based on the model, clinical and non-clinical staffing requirements must be assessed and updated to support ongoing activities. In addition, members and providers must be educated well in advance on any changes based on the carve-in or carve-out.

Provider education and coordination:

Carving in or out of services impacts the provider community significantly. Providers need to be notified about the timing of the transition. They need to be educated on how and where to submit service requests/authorizations in the future and if there are any changes to existing provider contracts. These activities must be planned and executed to consider the time needed for the provider community to adapt to the transition successfully.

UM process changes:

The impact of the staffing model within the UM department of the current organization and the organization taking over the benefits needs to be analyzed. Staffing changes should be implemented correctly, and staff should be trained appropriately. In addition, UM policies and procedures need to be either developed or updated to manage the benefit as per the new ownership. These updates should include end-to-end UM processes – intake, clinical reviews, physician reviews, provider and member communications, and regulatory reporting.

Education and coordination – Providers, Members, and Member representatives:

Providers need to be educated on how and where to submit appeals in the future and if there are any changes to existing provider contracts. Likewise, members and member representatives must be informed about the transition and educated on how and where to submit appeals and member grievances. These activities must be planned and executed to consider the time needed for the provider community to adapt to the transition successfully.

AG process changes:

The impact of the staffing model within the AG department of the current organization and the organization taking over the benefits needs to be analyzed. Staffing changes should be implemented correctly, and staff should be trained appropriately. In addition, AG policies and procedures need to be developed or updated to manage the benefit as per the new ownership. These updates should include end-to-end AG processes – intake, clinical reviews, physician reviews, committee reviews, provider and member communications, and regulatory reporting.

All decisions from start to finish of the carve-in/out implementation should be data-driven. The entity that currently manages the benefit should provide detailed data insights. Some examples include the percentage of the population receiving the benefit, the high-risk and high-cost population, current caseloads for care managers, and the number of member grievances. These numbers will help the new entity plan and implement the transition.

All aspects of the technology ecosystem should be considered during these types of initiatives. Existing data should be migrated to the new system to ensure continuity and limit impact on members and providers. The new system should support necessary access and restrictions, facilitate workflows, and offer reporting and analytics needed for internal and external entities.

The final and most crucial aspect is documenting desk-level procedures that bring various aspects of people, process, and technology together and make it consumable for the end users so they can efficiently perform day-to-day operations and ensure that the desired outcomes are achieved, be it service quality improvement, member and provider satisfaction, regulatory compliance, or cost savings

Contact us to start a conversation.

Health Services for Children with Special Needs, Inc (HSCSN) is the contracted healthcare plan for the District of Columbia’s Child and Adolescent Supplemental Security Income Program (CASSIP). HSCSN provides complete care for children and young adults with special health care needs.

Anoteros is a key implementation partner for HealthEdge’s care management platform, GuidingCare, at HSCSN. The first phase of this multi-phase implementation was focused on Care Management and went live in Q2 of 2023. Anoteros, in partnership with HealthEdge professional services, will continue this phased implementation with Utilization Management, Authorization Portal, and Appeals & Grievances modules.

The HSCSN Leadership Team has the following things to say about working with the Anoteros team.

“From day one, Anoteros’ expertise was clear. We never felt like they were just trying to sell us something – they just demonstrated they had the expertise we needed. This allowed all our senior stakeholders to get onboard.  

Anoteros worked with us to develop a phased implementation that allowed us to start getting the benefits of the new system as soon as possible, while also keeping within our budget constraints.  

I really appreciated Anoteros’ approach to change management for the new system implementation. They created and followed a well thought-out approach that was really tailored for us.  

Working with Anoteros really felt like a partnership, not a vendor relationship. I trust their recommendations because I know they are working in our best interest, and in close collaboration with HealthEdge. ”

“As a small health plan, Anoteros’ expertise in the health plan technology market was invaluable to us.  Going forward we would want to bring them in every time we are selecting a new system.  

Anoteros really tried to understand us – more than most consultants do. They gave us all the information we needed to make decisions, which helped us be confident in those decisions. ”

“Anoteros had a clear methodology – this allowed us to make scope and priority decisions very easily. Working with them, we were confident of success and ultimately, we went live on schedule.  

Anoteros had a solution-oriented approach throughout. When a problem arose, they always tried to find a solution within the current scope and budget, rather than defaulting to increasing their fee. ”

“Anoteros was fantastic the entire way through! So different than consultants I’ve worked with in the past. They really listened to our concerns and cared about the outcome as much as we did.  

Anoteros approached the project with a clear methodology – they were so organized. Some consultants just tell you to look at the project plan. The Anoteros team really understood the plan and methodology for the project and would guide us through it.  

 It felt like we were working with partners that wanted what was best for us. It felt like Anoteros was part of our team, not outsiders. “

If you are interested in learning more about our work with HealthEdge GuidingCare customers, please visit Anoteros and GuidingCare.
For more information on HealthEdge’s leading care management platform and services, please visit The GuidingCare Solution Suite

Payer organizations, no matter the volume of member lives, or number of products offered, all face a similar and ongoing challenge of maintaining operational efficiency, effectiveness, and financial optimization within an ever-changing environment.  This certainly isn’t breaking news – you can probably count the number of open operational improvement projects in your own organization by the dozen.

But what may be more unexpected is our observation that, even with the diligent efforts underway today, payers can be missing out on millions of dollars in revenue and/or savings due to issues in their operational architecture – processes, systems, business logic, roles –that they don’t even know exist. To explain how this can be, we have to consider the traditional approach to designing and managing operational architecture and outcomes in a payer organization.

Typically, payer operations are designed from an “outside-in” perspective – a regulation changes, a new line of business is launched, or customer expectations evolve, and the payer must respond. The payer redesigns its operational architecture – to meet the new or changed requirement, executes testing, and then implements the new way of working. This traditional approach can provide a false sense of security – a

At some point, inefficiency is suspected, analysis is conducted, and opportunities to streamline are identified (see above the dozens of ongoing operational improvement projects). However, this analysis tends to repeat the same process of assessing the architecture from the ‘outside-in’ – does it meet the requirements placed upon it? Our experience has found that this ‘outside-in’ approach to operations design and assessment has inherent limitations.

Let’s consider the example of a payer that was implementing a new rebate aggregator on a tight timeline. The implementation team designed an automated process to identify and extract claims for submission to the new aggregator, according to certain inclusion rules. When testing the new process, they diligently reviewed each extracted claim and confirmed that all met the inclusion criteria i.e. every claim that was extracted was correctly extracted. According to the requirements set for the project, the new process was working perfectly. However, a closer look told a different story: What was not considered were the claims that had not been extracted. When this data was analyzed, they found many claims that qualified for the rebate had been automatically excluded. Digging deeper, they identified errors in the configuration – when these were rectified, the annual value of the rebates increased by $12M and the payer learned an important lesson – to not just assess effectiveness from the ‘outside-in’ but to also consider what can be learned by looking from the ‘inside-out’.

To identify these hidden issues, Anoteros works with payers to conduct an operational health check – rather than starting with analysis of the operational architecture itself (the process, roles, systems etc.) against known requirements, our health check starts with analysis of the outputs of the operational architecture – the operational data – to identify hidden gaps and inefficiencies. This data-driven approach analyzes performance from the inside-out and across organizational domains. When the issues are made visible, we then reverse engineer the operational architecture to identify and address the root cause. Importantly, we also work with the payer to identify new performance metrics and to implement periodic/recurring data analyses to better monitor the effectiveness of the operational architecture going forward.

In our experience, this data-driven health check offers several advantages over the traditional ‘outside-in’ assessment approaches:

• High-level metrics don’t tell the full story. For example, a national payer was regularly monitoring its medical loss ratio (MLR) and satisfied that it was on target. But what this metric didn’t show was that MLR had been consistently rising in several specialty areas for several years and was now far exceeding the target MLR. This was hidden in the product level MLR because the increased costs were being offset by better-than-target performance in other specialty areas. Digging deeper into the data identified the cause of the increased MLR in several specialty areas due to an increased use of out of network providers caused by a combination of provider network gaps, no assigned primary care provider, lack of member incentives, ineffective referral management, and limited brick and mortar locations. When the payer addressed these issues, it reduced medical cost by $40M annually, improving its product-level MLR significantly beyond its original target.
• Bringing data together from different domains allows new insights. There are almost unlimited opportunities to compare and contrast data from different domains to identify previously unidentified issues. One example is the payer that eliminated $20M annually of fraudulent and/or wasteful medical costs in part by cross-matching transportation encounter data with medical service encounter data and then implementing changes to its governance and other processes to better manage these encounters going forward.
• Establishing recurring analytics on new key performance measures: Where the health check has identified previously unknown issues and enabled their resolution, the payer can now define new performance indicators to monitor. But again, a different approach must be taken – the ‘outside-in’ approach is by definition a point-in-time review – is today’s structure meeting today’s requirements? The ‘inside-out’ perspective recognizes that, in an environment which must constantly change to meet the evolving demands of customers and regulators, point-in-time assessments are of limited value. Anoteros’ health check approach therefore includes supporting the payer to establish automated analytics that use operational data to monitor a wide range of performance indicators on an ongoing basis. This allows the payer early visibility if performance begins to veer off track, so that timely corrective action can be taken, avoiding recreation of the costly blind spots of the past.

These hidden financial opportunities are just examples of the types of issues some payers have found. Other payers have used this type of data analytics to identify a host of other issues that directly impact financial performance including, but not limited to, improper risk-adjustment factor scoring, network management practices not aligned with utilization management and referral strategies, incomplete payment integrity solutions, lack of emergency department usage controls and avoidance strategies.

Are you ready to find the hidden financial opportunities in your operational architecture? Contact us today to discuss how the Anoteros health check can help your organization.