Blueprint of a High Performing US Healthcare Payer

As US Healthcare Payers continue to play an important role in keeping the healthcare cost in check while delivering care for our members, it is crucial to build an efficient and high performing engine that powers the Payer capabilities and serves its stakeholders. Here's a sample blueprint of how that high performing engine would look like.

Operating Cost

Like any successful enterprise, Payers need to keep a close eye on its operating cost and look to keep as low as feasible. While there are no special secret sauce to keep it's operating cost lower, some levers to prioritize for a Payer includes

1. Optimize its non-core functions like Infrastructure, Finance, HR, etc. through managed service contracts, efficient, automated and streamlined processes as well as having a small but high performing persistent team.
2. For its Core functions, look for options like Business Process Operations (BPO), Business Process As A Service (BPaaS) to find more efficient ways to reduce operating cost while not compromising on quality of service and outcomes.
3. For Core functions that are not outsourced, manage those functions using a high performing persistent team that knows how to be efficient, nimble and frugal to deliver w/o compromising on quality of service and outcomes.
4. Build a regular hygiene of enterprise system rationalization and tech debt reduction backed by a sound Cost Benefit Analysis (CBA) and Return On Investment (ROI) for those capital investments
5. Leverage AI, the new Gold, wherever possible to disrupt and reduce the operating cost involved.  

Total Cost of Care (TCOC)

This is a unique set of capabilities applicable to Payers and needs a thoughtful strategy to be efficient as well as effective. Frankly, this is where Payers differentiate among themselves, and good Payers have stood the test of time. Some of the levers to explore here include

1. Customer/Clinical Advocacy: Payers need to find way to meaningfully intervene in areas that have high cost and utilization and look for ways to prevent these incidents by working closely with the members and providers. Once we find out the key areas of interventions, all channels need to be leveraged to engage with the members to make meaningful intervention and positive impact both for the member as well as the cost of care.
2. Rx: This is another hot spot that needs a lot of attention and care to control the cost and utilization. While most payers will be relying on an established PBM (Pharmacy Benefit Manager) for their Rx capabilities, you need to work closely with the PBMs at a granular level to intervene on areas of high utilization and cost. Delegating all control to PBMs and treating them as a black box will be a recipe for disaster and lose your leverage to control one of the biggest cost in the TCOC picture.
3. Payment Integrity: You do need to keep a close eye on the necessary claim edits both in-line as well as post Pay for all your high value medical claims. Again, while there are vendors who you can delegate to for this capability, treating them as a black box would not be advisable as you will lose your leverage to control your total cost of care. 
4. Clinical & Medical Policy Management: Continue to adjust medical policies leveraged for capabilities like prior authorization to ensure there is no wastage as well as over prescription of care that can be counter productive to better health outcomes.
5. Provider Network Contract: Optimize provider contracts in collaboration with providers without compromising health outcomes of our members as well as not adding to already unsustainable pressure on the providers

Membership Growth  

Finally, we cannot forget the need to have a forward -looking growth strategy through membership. While product and price are the main tactics to attract new membership, following additional tactics needs to be looked at to make it easy and compete to get new membership.

1. Customer Advocacy: Capitalize on the TCC strategy as referred above that will deliver better health outcomes for the enrolled members.
2. Service Experience: Highlight high touch member service experience backed by robust technology and tools that enable high quality engagement with the members
3. Digital Self Service Member Experience: Demonstrate best in class digital self service experience that enables better member engagement and task completion for transactional and self service use cases that members prefer to handle through self service.
4. Provider Partnership: Demonstrate better engagement and collaboration with Providers through various multi-year initiatives resulting in higher level of trust with providers servicing members
5. Community Services: Finally, you need to highlight all the community services that you own and drive as a commitment to the local community. 

In summary, if a Payer focusses on the above tactics aligned to the three pillars (Operating Cost, TCOC and Membership Growth), it can find itself meaningfully helping the healthcare ecosystem by keeping the overall cost in check while ensuring every dollar spent is put to good use of improving the health outcomes of the members. Most importantly, it will find itself remaining profitable and viable while helping the healthcare ecosystem and its members.