February 5, 2023

Behavioral health providers can up their negotiation game with payers by shifting their attitude about the provider-payer dynamic and investing in their business systems.

The last few years have seen a shift in the most potent payers’ attitudes toward behavioral health. UnitedHealth Group Inc. (NYSE: UNH), for example, has established holistic care models, including value-based care and behavioral health, across nearly all its divisions. Similarly, Aetna and CVS Health (NYSE: CVS) have made behavioral health a part of an all-in-one approach to health care.

But it’s not a given that a value-based new payment model will mean higher payer rates. Providers need to prove their value and negotiate. One early value-based care approach is pay-for-performance. This is a model that ties incentives to specific accomplishments.

Such a tie between performance and payment helps payers realize the connection between behavioral health and the rest of a member’s health care. And making these kinds of ties between behavioral health and the cost of care in payer negotiations requires a collaborative approach that is based on data.

“If you take a busy primary care physician’s office and you look at the waiting area, that waiting area wouldn’t be half as busy if those patients did four things better — ate better, slept better, exercised better and dealt with stress better,” Vincent Bellwoar, senior advisor of the East region at Refresh Mental Health, said during a recent Behavioral Health Business webinar. “Who better to help them do those things … than behavioral health professionals?

“Were the least expensive intervention out there to get people healthier and a form of preventive care along with PCPs.”

Refresh Mental Health is one of the largest outpatient mental health providers in the nation with at least 200 in the U.S. It was acquired by Optum in March.

A combative stance in payer negotiations is all wrong for those seeking reimbursement increases or new care models, Bellwoar said.

Knowing the value of behavioral health is key in negotiating with payers. This buoys confidence in a dynamic where the leverage is clearly in the favor of the larger, more powerful payers.

It makes a behavioral health provider look like a “problem solver,” a winning approach with payers, Bellwoar said. Payers are focused on two primary drivers — both distant from health care itself — and lean on health care providers to know how best to care for people.

“If you feel they’re their enemy, I guarantee that’ll come through in how you speak with them,” Bellwoar said. “That’ll shut down your conversation really quickly. These first people are trying to do the same job — they’re trying to provide health care to a large group of people that’s affordable … and they’re trying to measure the quality of that health care.”

Know what payers want

Payers primarily focus on keeping premiums at a level their members will tolerate while understanding the total costs of care and some measure of the value of the care provided.

This, in turn, inspires a different approach in seeking higher reimbursement or a different model. Strengthening the case for premiums and getting the most out of the cost of care leads to questions of value. And a consideration that must be addressed — even before care is provided — is access to care.

“They know that’s the big issue,” Bellwoar said. “The No. 1 concern for all insurance companies is access, meaning that they can’t get patients in to see a provider throughout the country, we all know that you’re turning people way left them right.”

This is one reason why payers favor large mental health providers. They have some degree of confidence that patients will find availability at those providers. It’s also more efficient for payers to partner with larger providers. Small providers can make the most of their size by offering multiple specialties, Bellwoar said.

It also helps to know payer terminology. Understanding patient costs in terms of per patient per month and knowing data, the frame that payers use to assess the world.

Get your data

In order to agree upon a value-based contract, payers need something to assess a provider’s impact and value. That requires data. Big picture, the most expensive 10% of individuals accounted for 70% of total healthcare costs, according to a Milliman study. Within that high-cost group, 57% have a behavioral health condition.

Bellwoar said that patients with behavioral health conditions have an average of 273% higher annual costs across Medicare, Medicaid and commercial health plans.

It is also incumbent on providers to know the ins and outs of their own patient data. It’s wrong to assume that payers will be willing or able to produce the data that providers submit to them. Payers have thousands of arrangements with providers and often use data systems that don’t work at the individual organization or provider level.

“We assume [payers] know their own data — no, no, no,” Bellwoar said. “We assume insurance companies know a lot more than they do.”

Having internal data requires some use of data collection and other technology such as an electronic health record. This is a place where behavioral health providers struggle. In part, the industry has had the mandate or the support from the federal government to adopt electronic health records.

About 37% of private mental health organizations that take Medicaid use electronic health records (EHRs). Additionally, 32% of private substance use disorder treatment providers accepting Medicaid use EHRs, according to a report by the Medicaid and CHIP Payment and Access Commission (MACPAC).

Winning approaches for higher rates

The value-based care movement in behavioral health is still in a nascent stage, meaning there are not clear industry standards for best practices. Payers and providers are tackling this through specific partnerships.

This opens up space for basic arrangements for pay-for-performance models.

“I’ve found overall that these contracts — these metrics, what [payers are] measuring, what they’re asking [providers] to do — is very basic, it’s very easy to call it low hanging fruit. But that’s where they’re at,” Bellwoar said.

This allows for providers to make pitches to providers to do something the payer wants in exchange for, as an example, a 5% annual bonus, he said. Bellwoar said he’s seen a bonus for using an EMR and even increased rates for therapist offices providing access to psychiatric services.

Another major trend Bellwoar mentioned is using outcome-based care with validated measures. He said that, while some clinicians don’t value the soundness of PHQ-9s or GAD-7s for tracking depression and anxiety, payers are looking for anything to assess the value of care. In one case, a payer offered to pay fees for simply using outcome measures with patients.

The balance then becomes finding outcomes that clinicians will embrace. He specifically mentioned the TOP assessment.

“When you go to the insurer, they don’t expect you to bring data,” Bellwoar said. “When you bring data to them, they’re surprised and they want to have a conversation with you … they’re not the evil empire.”

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