Purchasing and selling between healthcare providers and insurers is increasingly a strategic activity. New mutual agreements do not merely consist of budgeting and enabling expense claims. On the contrary, both parties contribute their strategic intentions. As a result, healthcare contracting becomes the starting point for joint projects. IG&H conducted a research among hospital healthcare vendors and found that healthcare contracting is increasingly at the heart of the healthcare system. To cope with core healthcare issues, however, more cooperation is required.
In the Zorgverkoopmonitor 2019, IG&H takes stock with healthcare vendors and looks at the future. Nearly 25 healthcare vendors and finance managers at hospitals and clinics participated in the research. Together, they represent a total revenue of approximately €8 billion.
It turns out healthcare vendors want to set aside twice as much time to discuss policy themes and quality with insurers. Currently, price and volume still dominate more than 60% of all meetings. If it is up to healthcare vendors, 50% rather than 25% of meetings will be about substantive themes, such as the right care in the right place, meaningful care, and a vision of the region.
Approximately half of the respondents have concluded long-range agreements with the largest insurer – and a quarter of them with nearly all insurers – laying a solid foundation for a different type of meeting. ‘Unfortunately,’ not all of these are cooperations between providers and insurers. Part of the long-range agreements are simply concluded because banks require financial security. However, these long-range agreements provide peace of mind and room for a different type of meeting.
There’s a reason why healthcare vendors appreciate insurers bringing their own vision of healthcare to the table. You may disagree on this vision, but it is the main reason why 45% of healthcare vendors consider Zilveren Kruis the most professional of healthcare purchasers, and 25% believe it to be VGZ. According to healthcare vendors, they have set up a proper foundation for healthcare purchasing, and it is now time to give healthcare purchasers more authority and room for customization.
Ultimately, 30% of healthcare vendors consider the affordability of healthcare as the main challenge – especially the gradual transition (25%) to a different healthcare landscape (25%).
Healthcare vendors mainly want realistic financing, and they are willing to contribute to a financial transition. They, too, realize that healthcare should remain affordable for everyone. At the same time, they also need to deal with fixed accommodation and staff expenses, which means they can’t rush into cutting costs.
The art of concluding contracts in a new era
Even though they seem to have conflicting interests at times, healthcare providers and insurers face the same task. Of course, it can be completed through harsh negotiations, but lowering revenues and costs together requires a substantive cooperation.
The latter starts with mutual trust, which is created by truly empathizing with the other party.
The next step is for both parties to define a shared ambition that serves each party’s interests. Develop a vision of the region or certain types of healthcare, look beyond your own organization, and determine what it is you want to achieve together. Set up a joint project group, allow each other access to data, and perform the analysis together. Joining forces will automatically eliminate old behavioral habits. Discussions will no longer be about each letter in the contract but about what is good for the patient, the policy holder, and society. This will ultimately benefit insurers and healthcare providers, too.
By Walter Kien, Senior Manager Healthcare