In the rapidly evolving healthcare landscape, managed care contracting has become a critical component for providers aiming to diversify their revenue streams.
Christina Andrews, Senior Director of Professional Services at Axxess, and Joe Russell, CAE, Vice President of Network Management and Contracting at Strategic Health Care, discussed the challenges healthcare organizations face in preparing for regulatory changes, diversifying their revenue and succeeding in managed care contracting.
Prepare for Upcoming Regulatory Changes
“Recently we [Axxess] conducted a survey and our 2025 Industry Trends Report found that 60% of respondents feel neutral or unprepared for upcoming regulatory changes,” said Andrews.
This statistic underscores the need for healthcare organizations to diversify their revenue streams and operational strategies.
Russell emphasized the challenge of establishing sustainable care delivery models that meet the goals and needs of managed care organizations (MCOs).
“Many home and community-based services (HCBS) providers, especially smaller ones, lack the resources and expertise to negotiate favorable contracts with the MCOs, and the inability to secure adequate reimbursement directly impacts physical sustainability,” said Russell.
Without strong and diversified revenue streams, providers struggle to invest in the infrastructure and technology needed to adapt and grow.
Strategies for Success
To succeed in the new healthcare environment, Russell stressed the importance of strategic partnerships in MCOs.
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Be Selective With MCO Partners: “Stop signing bad agreements,” said Russell. “The idea that you need to be under contract with everyone is false. In fact, it actually hurts you.”
Russell advised providers to cancel existing unfavorable agreements and make health plans compete for their attention. This approach ensures that providers are working with MCOs that value their services and are willing to offer fair reimbursement.
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Make Smart Technology Decisions: “Invest strategically in technology, even while operating on thin margins,” explained Russell.
Data analytics and IT systems help facilitate better care insights and help quality metrics. By leveraging technology, providers can gain a competitive edge and demonstrate their ability to deliver efficient, high-quality care.
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Foster Collaboration: Collaborate with organizations by creating relationships with other providers and joining provider networks.
“Collaboration can help share resources, expertise and strengthen negotiating power with MCOs,” said Russell. By working together, providers can create a robust and resilient healthcare ecosystem.
Confidence and Strategic Plan
Russell expressed confidence in the ability of HCBS providers to adapt and thrive in the managed care environment.
“With a plan and some confidence, the organization is not only going to be able to make managed care work for you, but you’re also going to be able to thrive,” explained Russell. “I’m very confident we’re going to be able to get there together.”
To learn more about how your organization can navigate and adapt to regulatory changes, register for AGILE 2025, May 5-7 in Dallas.
