How Can Providers Optimize Preparations for Parity?

In order to maximize the opportunities associated with the Mental Health Parity and Addiction Equity Act (MHPAEA or “Parity”) in the commercial/private health insurance sectors, particularly among ERISA group plans, substance use disorder treatment providers (among others) are encouraged to conduct some serious business and strategic planning in the coming weeks and months. By virtue of the sea-change that is occurring — vastly different conditions in the commercial health insurance and third-party payer markets magnified by reforms and the looming boom in Medicaid (and Medicaid managed care plans) — behavioral health providers have to understand that the dynamics in their business model are changing. The days of 60-75 percent of the total financing of behavioral healthcare resulting from government programs for the uninsured are numbered days, indeed. Providers’ ability to operate and thrive in a private sector paradigm is paramount now.

Providers and their associations are encouraged to invest time, energy, capital and other resources in the following areas. Of special note here is the call to action. This is no longer the time for high-level overview, theory and concepts. This is the time for business decisions and project management. Those who can deploy and execute will enjoy the spoils of a new marketplace for behavioral healthcare.

Action items

1. Advocacy — Identify what is important to the field locally in response to the scope of covered disorders, covered services, medical management practices, and standards for provider credentialing and contracting in the law.

2. Planning — The willful and deliberate organization-wide practice of establishing strategic objectives and conducting thorough business modeling in order to maximize the opportunity that MHPAEA and other reforms represent.

3. Policy — The careful attention to actual changes that must be reflected in your organizational and operational policies.

4. Project Management — The need for professional project management practices and tools that enable comprehensive change. Providers are encouraged to develop that skill set within their management team or to find external project management support for the duration of significant change initiatives.

5. Process/Workflow Analysis/Design — Real change in business practices must be reflected in business process and workflow. Expansion into new markets and new business relationships under the auspices of new regulations will involve considerable process re-design for most providers. This is not ordinarily a skill-set that resides within most substance abuse provider organizations so associations can play an important role in fulfilling that need. If you hire a consultant, be absolutely certain that consultant is not only experienced and skilled in business process management but also in techniques like the Lean Methodology and – above all – in substance use disorder treatment and managed care protocols. Some of us cover the gamut and others are kidding themselves and you. Check references carefully as these changes are difficult to un-do.

6. Credentialing/Applying for Network Status — Many providers may not be well-versed in what is required of participation in preferred provider and managed care networks. Understanding what is expected in terms of accreditation and credentialing and assistance with the application process is vital to the field. Hire an interim specialist or consultant and visit with your local networks’ provider relations staff. Ask your peers and associates for ideas and feedback. This is not the time to worry about competition.

7. Negotiations/Reimbursement — By virtue of many of the business changes involved in health plan and employer implementation of MHPAEA and the regulations, providers will have the opportunity to negotiate Usual, Customary and Reasonable rates of reimbursement. This is an area that may be new and challenging to many providers. External support for this purpose may be in their best interest. Hire an interim specialist, form a consortium to accomplish this ongoing objective or hire a consultant. You may be sorry if you attempt to do this yourself and lack the competencies.

8. Billing — Support with electronic data interchange or EDI-compliant electronic billing will be a cornerstone of success for providers in the commercial/private sector. Providers who have been largely accustomed to billing public programs may not be well-prepared for many multiple payer systems and protocols. This is a distinctly important area of focus for providers who may have developed their billing and claiming processes and systems around public programs that do not require EDI-compliance. The Health Insurance Portability and Accountability Act set down standard transaction sets for specific EDI transactions including eligibility, authorization of benefits and claiming, each of which is critical to conducting business in the private sector. Among the three, billing/claiming is far and away the most important. Some providers attempt to purchase solutions in the form of EDI-compliant practice management systems while others send their billing to an EDI Clearinghouse that transforms their claims data into an EDI-compliant file and manages the point-to-point connections between a single provider and multiple payers. There are numerous directions to explore and all have merit. Manual paper billing is going the way of the do-do bird so plan for renovation in your billing department now.

9. Health IT — As mentioned above with billing and other practice management needs, accelerating into the commercial/private market will raise the stakes around the need for electronic health records. While these systems are very costly and extremely difficult to evaluate and select, they are harder still to successfully implement without external support and guidance. This is a service that can be arranged by expert consultants and some management service organizations or MSOs. Many providers around the country are beginning to organize themselves into consortia or cooperatives for this purpose which also has merit. It’s critical to understand the entire life-cycle of these projects and the total cost of ownership. Again, ask your peers and associates – even primary care docs – about their experience and lessons learned. Remember – one of the last steps in the process is paying good money for software!

10. Marketing/Promotions — As providers enter the competitive commercial/private market, they will require some expertise and direction where marketing and promotion of their services are concerned. Get help. Marketing is essential and there are experts out there.

11. Legal — Providers will need assistance in the contracting process as they expand the number of commercial payer agreements they have in place. There’s no question that an experienced lawyer is in your best interest. Ask your peers for referrals.

12. Other Service Purchasing/Procurement — Any other strategic purchasing – such as temporary staffing, consulting, technology (phones, software, tele-medicine, etc) can be done through the formation of a management services organization (MSO) or technology services organization (TSO). Associations can take the lead in developing a procurement capacity for its members.