It's time for payers to build trust, partnerships with providers

Jim O'Neil

San Francisco really is a lovely town, and I was happy to spend time there last week at the AHIP Institute. After three days filled with conference sessions and meetings, I sat down in the beautiful Yerba Buena gardens to sift through my multiple pages of notes and realized one of the key take-away messages from the annual conference: Payers and providers must make nice.

I know this isn't earth-shattering advice, but with so many changes and reform initiatives coming down the pike, the industry is at a critical juncture. Regardless of how the health reform appeal efforts play out, or whether health insurance exchanges are formed or whether accountable care organizations are successful, both sides of the healthcare industry must join together and let animosity fall to the wayside.

Former Sen. Tom Daschle (D-S.D.) addressed payer-provider collaboration in his brief 15 minutes remarks, calling it "critical" during these "tremendously transformational times."

Analysts from Deloitte Consulting concurred. "We need much more collaboration between health plans and providers," Dhan Shapurji, director at Deloitte, said during a discussion of the challenges created by exchanges. Referring to ACOs' ability to accomplish cost savings, Deloitte's healthcare practice director Robert Williams told me that payers "can't be silo-based anymore." As the industry inevitable shifts to a more value-based system, interdependency between payers and providers will be key, he added.

And Eric Logue, director of Navigant's healthcare payer practice, stressed that partnerships between payers and providers should be more transparent. "Plans must share information with providers, and providers must trust that information is correct," he said. That's a problem, however, because health plans and providers "don't speak a common language." Logue urged both sides to work together, because as reform continues to push the healthcare industry toward new payment models, the changes will have a "dynamic impact on payer-provider relationships."

As the industry experts extolled the virtues of teamwork, it was clear that, just beneath the surface, they recognized what a tall order they are recommending. "There's been no sharing of information in the past," Logue said. The pros from Pegasystems agreed, adding that payers are more interested in collaboration than providers right now. Something has to be done, they warned, because "status quo" doesn't work anymore.

I know there's some bad blood between payers and providers and that both sides like to play a game of chicken with each other, particularly during contract negotiations. But c'mon, we are adults in the real world, not third graders on the school playground. Payers and providers are two sides of a comingled and interdependent industry, not scorned lovers refusing to be the first to apologize or a divorcing couple using fear as a negotiation tool in deciding child custody.

Isn't it time to step up to the challenge of the times and be the bigger person (or industry segment), the one able to take ownership of previous mistakes and their role in an adversarial relationship, and vow to move forward without grudges? It would be good for the industry, and who knows, it could be the start of a beautiful relationship.