Prashant Jhaveri, Chief Business Officer, Medi Assist recently wrote an article for the Silicon India in which he discussed about the concept of Managed Care Organisation (MCO) and its importance in the Indian Healthcare Ecosystem. He also discussed about the various techniques deployed by MCOs to promote informed decision making and reduce overall cost of care for consumers.
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The concept of managed care, aimed at reducing cost of providing quality healthcare, is still in its nascent stage in India. A popular concept in the United States, the need for managed care organizations is perhaps far more acute among developing nations such as India. Medical inflation in India stands at 12-15 percent as against a global average of 6-7 percent. Despite the steep rise in cost of healthcare, the IRDA Annual Report 2014-2015 indicates that only two percent of the Indian population is covered by individual health insurance policies; and only another four percent are covered under group medical policies. In the absence of any medical cover, the average Indian family today grapples with high out-of-pocket expenses on account of healthcare.
A recent report by FICCI suggests that primary healthcare accounts for over 70 percent of all medical spend and that the per capita spend of urban households on outpatient care is approximately Rs. 4,250 per person, a typical urban family of four adults, therefore, spends an average of Rs. 17,000/- per month on doctor consults, medicines and diagnostic labs. Add to this the inherent lack of transparency within the healthcare ecosystem. While it is, for example, easy for one to compare myriad options, choose and book holidays, travel, stay and so on, consumers do not have such deep visibility into the options available to them when planning their medical spend. Managed Care Organizations (MCO), therefore, have a significant role to play in the Indian healthcare ecosystem. Not only do they bring all the stakeholders of the ecosystem together, they also work towards deploying techniques to promote informed decision making and reduce overall cost of care for consumers.
MCOs Negotiate Early
Managed care organizations partner with healthcare providers to obtain preferred tariffs and discounts for their members. While the preferred pricing helps increase visibility and footfalls for the provider, it helps reduce cost of care for the individual. MCOs also deploy various loss control measures to ensure that, in the event of a hospitalization, members are provided most optimal care at the most optimal price point at their chosen network medical centre.
MCOs Tech-enable early
Managed care organizations, which collaborate with all stakeholders in the healthcare ecosystem, are best placed to invest in technology for transformation. Technology allows all stakeholders to come onto a common platform to improve speed of access and quality of delivery. Our technology platform, MediBuddy, for example, allows hospitals to provide seamless cashless access to in-patient and outpatient services to their patients; it gives insurers and corporate decision makers deep visibility into the performance of their health benefits portfolio; and importantly, it gives every individual member the power to compare, choose, and schedule healthcare services using just their mobile phone from the comfort of their home. The predictive analytics capabilities help decision makers spot trends and take informed product and service delivery decisions for the future.
MCOs Help Plan Early
Planning is the key to optimal decision making. For example, a planned maternity can help the family ensure greater comfort for the mom-to-be and also help the young couple reduce their out of pocket spend by optimally utilizing their health benefits. Similarly, a managed care organization can help senior members planning an elective surgery to opt for cashless hospitalization at a preferred network, at a discounted preferred pricing. Innovations such as e-Cashless allow members to choose their preferred network medical center and obtain a provisional preauthorization using a mobile app for a cashless hospitalization. E-Cashless also gives the family full visibility into the expected cost of treatment, amount covered under their policy and the corresponding out of pocket spend, if any.
MCOs Intervene Early
Fraud and abuse control is critical to the success of any health benefits program. Managed care organizations play a significant role in ensuring that the benefits are availed by genuine beneficiaries and as per the terms and conditions defined by the benefits policy. New-gen MCOs use a combination of technology and professional expertise for risk detection and mitigation. MCOs have been credited with generating significant savings for the industry on account of their diligent interventions. Managed care organizations are poised to play a crucial role in these transformative years of the Indian healthcare industry. With deep understanding of the often divergent needs of all stakeholders in the industry, technology leadership and an optimistic vision for the future, MCOs are here to bring about disruptive change in how we think about healthcare spend.