How To Stay On Top Of Payer Contracting And Drug Pricing?
The contracts between insurance payers and pharmaceutical manufacturers are here to stay in the medical world. In the last few years, these value-based contracts have been growing. Not only that, these are bringing in higher payment rates in the process of improving the outcome for the patients. They are also supplanting the traditional contracts in which rebates on the payments were based on volume and the formulary.
What Is Payer Contracting & Drug Pricing?
Theoretically, the ‘at-risk’ or value-based agreements are developed for positive development. The pharmaceutical companies in such a scenario uphold the performance of the drugs with these contracts. The process allows the medical facilities to offer the best service and results to the patients.
However, the reality has been a bit different. These contracts have been based on un-advanced volumetric math, making them a value-based idea but not fully functional. It is because manufacturers are still working on achieving a simple volumetric percentage. Its efficacy is still based on the profit goals and payment within these agreements.
In reality, the improvement of value-based contracts can only happen when the evaluation is based on more complex factors like lifestyle measurement and its corresponding evidence.
For instance, the outcomes can be measured based on the rate of HCV cure, readmission to hospitals, and A1C counts on diabetes. The process also needs to involve a care team and the lifestyle outcome to showcase the value-based contracts, though it is not easy.
An article published in Wall Street Journal mentioned that manufacturers and insurers find immense complexity in tracking a patient’s health. Mainly when it is under the insurer, it poses to be a barrier. Also, with most contract suppliers tied to the payment of prescription volume, the value-based contract process becomes challenging. It also mentions that its setup can be perplexing because understanding its success can be challenging to track.
For instance, heart attack reduction based on drugs or decreased deaths because of cholesterol can take ages, to be precise. Additionally, patients often change the insurers; their jobs make it difficult to track them over time.
How To Stay At Top?
When it comes to speciality healthcare – staying at the top of the payer contracting and drug pricing is essential, even when the value-based agreements offer a limited scope. In addition, since most speciality healthcare has used cutting-edge pharmaceutical and other therapies at the high end of the cost spectrum, maintaining revenue cycle management (RCM) is essential.
In such a scenario, the provider and the payer want to ensure that the patient has access to the treatment without getting embroiled in the challenges that plague the value-based agreements.
As part of the innovation and incorporation of the latest technology, the healthcare system has been changing at a rapid pace. More than ever, it has become essential to monitor spending. Hence the payers change the reimbursement rates for the drugs frequently. For instance, the Centres for Medicare and Medicaid Services (CMS) update their drug reimbursement rate every quarter for Medicare. Unfortunately, it results in many payers of the nation following the same schedule, thus leaving the providers of speciality healthcare to scramble for constant adjustments.
It needs to be taken into account that even a tiny adjustment in the rate of a high-cost drug can cause a predicament to the financial health of a practice. Therefore, the providers must maintain comprehensive visibility into the contract of the payers, their payment rates, and the population of the patients all the time.
One of the critical steps in staying on top of the payer contracting is to have an RCM solution with features that are highly capable of contract management. It should be able to differentiate a flexible reporting system and take the necessary steps to manage the contract of the payers while updating the drug pricing. Given the expectation in the healthcare system today with high service volume, it is vital to leverage the best RCM system to streamline the work process and improve productivity by reducing the burden on the administrative staff. It should also be able to offer flexible adjustments to different financial projections, support compliance reporting, and be a sustainable solution in the frequently changing medical environment.
How To Ensure You Are Doing It Right?
These are the solution to stay on top of the much-complicated payer contracting and drug pricing issues. But we know following these could be pretty challenging. In such a case, contact the 24/7 Medical Billing Services with the best RCM software and a dedicated, experienced team in medical billing and coding to ensure that your revenue management is on the top. Then, based on the speciality care and the facility’s requirement, we will develop the RCM that can offer the best results for your practice while ensuring you can scale better with improved ROI.
Read more: Does Your In House Team Lack Deep Insights Into The Revenue Cycle?
