Smarter Contracting to Build Lasting Healthcare Payer-Provider Relationships
Private health insurance carriers in the United States are responsible for providing coverage to more than 70 percent of the country’s population. This expansive operational footprint is underpinned by an equally broad network of providers comprising thousands of healthcare professionals, primary care doctors, specialists, and hundreds of hospitals. As a result, the success of every insurance product in the portfolio of a typical private carrier is dependent on the company’s ability to sign the widest selection of professionals specializing in diverse medical and therapeutic areas. After all, individual buyers are more likely to invest in a product that enables them to gain seamless access to quality healthcare.
However, signing providers into a network is a complicated affair. Insurers need to draw up multiple contracts and negotiate favorable terms with them, all the while ensuring compliance with state and federal regulations. Typically, insurers onboard providers to a network through a Participating Provider Agreement (PPA). This agreement establishes the terms for provider credentialing, claims submissions, timely reimbursements, dispute resolution, renewal or termination of the contract, and the fee for services.
Broadly speaking, the conventional contracting process isn’t tuned all that well to take on the scale and risks associated with such complex requirements. To begin with, PPA templates are usually treated as boilerplate documents, which means that they could be misaligned with evolving regulatory requirements. In turn, during the contract negotiation process, risk elements such as missing clauses and clause deviations could go unaddressed. Moreover, if post-execution changes are not easily auditable, it could lead to conflicts at the time of claims submissions and payments. In the absence of an automated monitoring and notification system in place, insurers could run the risk of missing contract renewal deadlines, which could lead to discontinuation of service by a network provider.
Rewriting the Provider Contracting Playbook with AI-led CLM
An AI-led contract lifecycle management solution can overcome the challenges of manual contracting by ensuring standardization, enhancing collaboration, and offering intelligence based on past contracting data to craft contracts that offer better business outcomes.
Straight off the bat, a contract lifecycle management (CLM) platform can streamline the authoring process through its self-servicing capabilities. A CLM for healthcare payers can help them roll out contracts faster. Payers can quickly build first drafts using preapproved templates and clauses from the standardized contracting playbook. This draft can then be sent to a provider for their review. In effect, this could help insurers cut down the time-to-contract from days to just hours.
A single health insurance plan has a network of thousands of healthcare providers. On receiving the reviewed contracts, it can be challenging for payers to gain a transparent view of all the changes introduced by each provider. A smart CLM solution can highlight the changes made in each contract, compare it against standardized clauses in the template library, calculate risk, and offer AI-led prescriptive suggestions to remediate them. The process of negotiating with multiple providers becomes more streamlined and reduces the scope for errors to creep in.
Simplifying Compliance and Performance Management
Health Insurance Portability and Accountability (HIPAA) requires entities dealing with protected health information to sign a Business Associate Agreement (BAA), failing which healthcare providers can be heavily penalized. North Memorial Healthcare of Minnesota had once shared their PHI with their vendors without a BAA. They had to shell out $1.55 million to the Office of Civil Rights, U.S. Department of Health and Human Services in 2016 as a penalty.
To ensure that such lapses do not occur, insurers can leverage a smart CLM platform to create complex contract packages containing all required compliance documents with just a few clicks. Once configured properly, the self-service contracting ability can be used to assemble contract packages. Smart tags will ensure that linked metadata fields in every document in the package are immediately populated as soon as it is entered into one document. In turn, this enables payers to execute contracts faster and reduce post-execution risk by ensuring that all necessary agreements have been signed.
Once a contract is signed, an AI-led CLM solution can track each embedded service level and obligation to ensure that contract managers are proactively alerted about possible breaches or delivery failures. In addition, this performance data, along with contracted terms, can be used to validate invoices to ensure that the insurer pays only for services that have been delivered.
An AI-powered CLM solution can also enable payers to keep up with the approaching deadlines. It can be configured to send out alerts to payers to ensure that they don’t miss renewal or expiration deadlines. Timely notification to payers can enable them to take the right steps in time to ensure business continuity.
Scaling Provider Networks for Improved Member Experience
Smart contract lifecycle management solution empowers payers to manage multiple provider contracts at once, create scalable processes through automation, and enable them to focus exclusively on strategic decision-making. Beyond contract management, a CLM solution also relays information on provider performance and keeps provider information updated. It enables payers to provide all the necessary information to health plan members to navigate their healthcare journey, which can lead to even higher satisfaction levels.