A More Sustainable Future

With commercial incentive-based products focused on quality and efficiency, Terry Manna is helping to reshape healthcare in New Jersey

Terry Manna, Meridian Health System Inc., Vice President of Managed Care
Terry Manna, Meridian Health System Inc., Vice President of Managed Care

You oversee managed-care revenue, primarily under a fee-for-service model. What’s your latest product strategy?

Terry Manna: The commercial incentive-based product strategy differs in concept from typical attribution models that exist in the market. Our product strategies result in benefit plan designs with significant member copayment and coinsurance differentials to utilize the providers that are part of Meridian Health Partners. A key element of our product designs is for the providers in Meridian to provide the care in a clinically integrated manner. The network receives care coordination payments and upside shared savings opportunities for meeting certain quality and efficiency objectives. 

How is this incentive-based strategy helping Meridian migrate to risk-based reimbursement?

TM: Early in my career, when I worked for a large payer in Chicago, I would visit with the physician boards of various IPAs/PHOs and share data with them that was 90 days old. A requirement for Meridian Health Partners is collaboration with our payers to provide us with real-time data. This data includes timely claims, eligibility, and member attribution feeds from the payer(s) that gets integrated into Meridian’s enterprise data warehouse. This actionable data arms our physicians with real-time utilization, claims, quality performance, and attribution information on their patients to improve the quality of care while reducing out-migration of service that otherwise may have been provided within network providers. The combination of having real-time clinical and utilization data and the collaboration with our physicians and payers to provide care in a clinically driven environment, with aligned quality and efficiency incentives, are the basic ingredients for population health, value-based contracting, and migration to risk-based reimbursement.

What is Meridian doing differently when contracting with payers in New Jersey? 

TM: Our payer negotiations are moving away from “traditional haggling” over fee-for-service payments. Meridian has an all-payer strategy when developing value-based initiatives. Recently we launched two incentive-based product agreements with two significant payers in our market: Horizon Blue Cross Blue Shield of New Jersey and AmeriHealth of New Jersey through Meridian Health Partners. Both products have similar attributes in that they offer our network on a narrow banded Tier 1 basis that allows members in our catchment area to seek services from our providers while incurring lower out-of-pocket expenses. Both products will offer Meridian Health Partners’ network to business segments, including both small and large group employers, and individuals on the marketplace exchanges with competitive premiums. Meridian will be introducing additional incentive-based product collaboration with payers in the near future.

What are the value-adds to the patients?

TM: The strategies we develop with the health plans introduce products at certain competitive premiums. These products expand the access for our patients to utilize Meridian hospitals, physicians, and partner companies that make up Meridian Health Partners at lower-cost opportunities. The patients have access to an integrated, high-quality healthcare delivery system on a Tier 1 basis where they incur lower out-of-pocket expenses.

How does this approach in contracting set Meridian apart?

TM: A lot of our competitors are doing attribution models with their ACOs, without benefit-plan designs or member incentives. Meridian is building the infrastructure to manage population health. Our commercial product strategy is consistent with Meridian’s mission to manage populations in a clinically integrated manner with physicians.

How does Meridian work together with the plan to lower costs?

TM: Lowering the cost of care must be in concert with our physician partners. Each of our product designs has established quality and efficiency matrix targets. The Quality Committee of Meridian Health Partners selects the HEDIS ambulatory measures to track. If the network’s performance achieves the established quality and efficiency objectives and care was provided in a high-quality, cost-effective way, we share in the savings opportunity.   

So this is a step toward a risk-based model?

TM: Meridian is on track with building the infrastructure and integrating with our providers to manage a future risk-based environment. 

Why did you decide to take this approach?

TM: We tested the product concept when the first marketplace products were offered several years ago in New Jersey. Meridian was one of the few providers that contracted with payers and participated in the exchange products. However, the initial exchange products pilot for Meridian did not include any of the clinical-integration components that we require today through our network. Meridian hospitals were offered on a narrow network Tier 1 basis, which resulted in a significant growth in volume.   

How do these new plans yield effective results and contracting opportunities?

TM: Our commercial incentive-based products launched on January 1, 2016. We are highly optimistic that the products will yield the same success Meridian witnessed under the marketplace products. However, the vast differences are that our new product models include value-based clinical-integration components and will be offered to expanded business segments to self-insured, fully insured, small and large group, and ON/OFF the marketplace exchanges. We are very encouraged the products will yield growth, clinical value, and sustainability. AHL

MagnaCare, a healthcare-services company, is proactively reducing the cost of healthcare by offering self-insured options to employers in New Jersey and New York. The company offers access to a broad provider network, predictive modeling analyses, member outreach programs, and integrated solutions that include full plan management services.

A true business partner, MagnaCare shares a professional relationship with Terry Manna, vice president of managed care at Meridian Health. MagnaCare benefits from Terry’s can-do approach in developing innovative solutions and overcoming obstacles. By joining forces, both MagnaCare and Meridian Health are able to thrive in today’s increasingly complex healthcare environment.