Why Strong Relationships Matter in Financing of Complex Care Management

By Caitlin Sweany-Mendez, MPH, Health Care Transformation Task Force, and Margie Powers, MSW, MPH, Pacific Business Group on Health

Caring for the complex chronically ill — a population that makes up about 5 percent of patients and nearly 50 percent of health care spending — is remarkably challenging. It’s also essential, as the United States transitions to a health care system that is driven by value.

Complex care management programs offer tremendous potential in reducing unnecessary costs and improving patient outcomes by coordinating care across settings, providing non-medical services such as transportation and food assistance, and encouraging individuals and their caregivers to actively participate in their care. But while many successful programs already exist, many simply aren’t receiving the long-term funding they need to sustain and scale.

New research by the Pacific Business Group on Health and the Health Care Transformation Task Force shows that the struggle for well-deserved financing is directly tied to complicated relationships between and within providers and payers. Commercial payers may not know about the value of provider-led programs, and providers may not be adequately communicating that value. Often, the lack of communication plays out internally in provider-led programs before it rises to an external level: clinical, financial, and legal teams may not be on the same page about the value of complex care management.

How can we bridge the gap?

Building internal relationships within provider-run programs

Good communication on the value of complex care management programs starts internally with clinical leads. Care program leaders must be able to make a strong case for the long-term value of these programs to senior management in their provider organizations. They must be able to work with finance specialists to create effective business cases, which can in turn be used to build support among organizational leadership. Top-level institutional support for care management programs can be crucial to ensuring funding, even if outside reimbursement is not available.

Complicated hierarchies and information silos can make it difficult to foster internal relationships and align stakeholders around the value of complex care management. This is especially true in health systems with an entrenched fee-for-service mentality: programs that work to curtail emergency department use and inpatient admissions may be perceived as counter to the organization’s financial goals. When pursuing a relationship with finance and legal teams, clinical leads should:

  • Identify a liaison (i.e., a chief medical officer) to act as an initial conduit and program champion to help facilitate relationship-building;
  • Schedule in-person meetings and establish a regular cadence for contact to encourage personal interaction;
  • Be open to learning more about institutional and departmental priorities, as well as relevant financial and legal terminology/concepts; and
  • Share materials that highlight the key goals and value of the program — not just from a clinical perspective but also from a financial perspective.

Once providers have secured internal buy-in, then they’re ready to initiate a conversation with payers on how funding these programs can be beneficial for both parties.

Building relationships with payers

The long-term goal of most provider-run care management programs is to obtain sustainable reimbursement. Good payer-provider communication is, of course, a two-way street. So how can providers cultivate a healthy partnership with payers?

Providers should build on existing positive relationships wherever possible and cultivate personal connections with receptive payer contacts. Finding an initial receptive payer, and building evidence of a successful partnership, may also help create momentum for relationship-building with other payers down the line. 

Payers, for their part, should be open to learning about provider-run care management programs and potential delegation of responsibilities. For larger payers that have established and streamlined care management programs, the prospect of paying providers to perform some or all of these services may initially seem unappealing; they’ll be more likely to partner with provider organizations if they see evidence of other successful partnerships, a strong existing working relationship, and a sharp business proposition. It may also be useful to start small, with reimbursement for select services and sharing of data for optimal care coordination. 

Complex care management is a powerful tool to improve the lives of medically complex patients, decrease unnecessary health care expenditures, and help move the industry toward value. As programs continue to evolve in their sophistication and efficacy, relationships and creativity will be key to developing sustainable financing.  

Editor’s note: This blog was informed by research on best practices in care management contracting, conducted by the Health Care Transformation Task Force and the Pacific Business Group on Health. Read the report, Best Practices in Care Management Contracting for the High-Need, High-Cost Population, and the accompanying practical guidance document, Contracting for High-Need, High-Cost Populations.