Any new health business must demonstrate three basic functions:
- Adequate budgeting and initial marketing skills must be demonstrated.
- Adequate testing of critical technology must be successful.
- And connections to customers must be in place.
Only if budgeting and marketing, technology, and customer relationships are established can other new-business activities be successful. As implementation of the Affordable Care Act (ACA) nears its moment of truth, when open enrollment in the healthcare insurance marketplaces begins on Oct. 1, 2013, the status of these functions can shed light on progress and problems.
The new Health Insurance marketplaces, or exchanges, have already displayed inadequacy in budgeting and initial marketing. The Department of Health and Human Services (HHS) has announced that program budgeting has not included an adequate setting aside of funds to pay for required education and outreach for the new Health Exchanges.
This explanation has come after three years during which HHS has neither taken any clear actions toward mounting a major outreach effort to explain the ACA nor acknowledged the need for such action. We are not aware of any mailings to the public, TV public service programs, to recruitment of providers to distribute brochures.
HHS has now been reduced to seeking last-minute donations to support outreach efforts, demonstrating that initial budgeting failed to adequately prepare for this predictable need. (See Kliff, S., "Budget request denied, Sebelius turns to health executives to finance Obamacare," The Washington Post, May 10, 2013.)
Any testing of technology has been well hidden. Each marketplace must link to insurance companies that are to offer insurance policies for sale, and provide individuals and small-business employers with an easy-to-use and easy-to-understand software interface so that policies may be scanned and purchases made. Demonstration efforts should be common today across the country.
And each marketplace must illustrate seamless communications with the IRS so that income information supplied by individuals may be sent to the agency, and it can calculate and communicate back the amount of any subsidy to be received.
All of this must happen in a timely manner, or individuals will give up on the effort and blame the technology.
Finally, any new health business must show that it understands potential customers, and must demonstrate this connection in a way that customers will recognize. To date, the marketplaces have not addressed this issue. There has been no recruitment of representatives who can be recognized by and speak effectively to those who will be seeking insurance coverage through an marketplace. There is no "image" for these businesses.
The status of the marketplace at this point indicates more than "growing pains." Rather, there seems to be a basic lack of understanding about the requirements for setting up and implementing successful "marketplace" businesses.
Healthcare organizations should not sit idly by and placidly contemplate this situation. Get-well plans are urgently needed. It may be time for those who are experienced in the development of successful healthcare organizations to voice their concerns—and even lend a hand. The ACA agencies are far afield from their usual tasks, and could use insight and assistance. But they may not yet understand the nature of the need, or show a willingness to ask for help.
Healthcare leaders can respond to this situation in several ways. In the very least, they may want to consider appropriate internal actions within their own organizations to adjust to the expected outcomes of the problems being encountered by the Exchanges.
Other managers may decide that direct intervention strategies are possible, by attempting to set up lines of communication to help steer the marketplaces in directions that will not only make them more effective with consumers but also reduce internal problems for the organizations managing the marketplaces. This approach will depend on healthcare leaders’ ingenuity and ability in making their voices heard.
Enlisting third parties for communications may have potential in some cases. Healthcare leaders can cultivate an indirect relationship with a third party that already has a relationship with a marketplace, and with the manager’s organization. There might be greater receptivity on the part of the marketplace manager, as efforts could achieve changes that will benefit all three organizations.
Ferd H. Mitchell is an attorney, Mitchell Law Office, Spokane, Wash., and a member of HFMA’s Washington-Alaska Chapter.
Cheryl Mitchell is an attorney, Mitchell Law Office, Spokane, Wash.
Publication Date: Friday, June 21, 2013