The health care delivery model is changing.  New models like ACO, PCMH, COE have evolved in the last few years. The payment structure in these models is typically aligned to quality measures, but the metrics and the operational processes required to achieve them are driven by large carriers (and CMS) or health systems or both. Even though self-funded employers contribute significantly into their revenue, they have largely been left out from the discussion.

Member segmentation is one such example – Large health systems and carriers serving diverse populations are trying to follow different risk stratification models including ACG, HCC, ERA, CCC, Charlson Comorbidity Index, MN Tiering etc. While these models may serve their interests, not necessarily yours. For example, Medicare uses HCC (Hierarchical Condition Category) model that assigns a risk score based on chronic or serious condition and demographics, which works for 65+ population they cater to. HCC model may not be suitable for your population.

Similar to large health systems, PCMH providing primary care to your employee populations are also trying different methods for their risk stratification including primary , secondary, tertiary prevention and terminal care. Again, these models may not exactly work for your employee population.

The employee and dependents population in mid-large employers is typically spread out in multiple geographies often served by multiple health systems. If the metrics and processes are not defined by the employer and left out to the systems or carriers, employers will end up facing the same issue that they currently face with PPO models: Data inconsistency and limited insights into overall plan performance.

As you start thinking about about benefit design, start looking at segmenting your employee population. For each segment, you can define the right care models, incentives and discounts on copayments for your employee population and align the payments to your provider partners to meeting those metrics.

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