April 9, 2001
By Sylvia Wrobel
Over the past two years, all Emory Healthcare (EH) managed care contracts have been renegotiated according to a strategic plan laid out two years ago.
The most significant change, according to Managed Care Director Patrick
Hammond, is that nearly all EH doctors now participate in each and every
contract. Previously, many of the contracts were part of horizontal
specialty networks, managed care language for when insurance companies
subcontract with Emory for only one or two physicians in a given specialty.
Good for some doctors, maybe, but not necessarily good for the ones left
outor for the system as a whole.
Using an all or none policy as well as other criteria, EH
eliminated more than 40 contracts. About half of all managed care opportunities
presented to Emory today are turned down for the same reasons. But having
90 good contractsas opposed to 130 or more that dont always
fit overall objectivesappears to be working well, Hammond said.
Managed care gross revenue and reimbursement rates have increased significantly.
The major overhaul was the charge of a contract pricing team, one of
a series of system-wide decision-making teams established last year by
EH President John Fox to improve overall performance and increase the
ability to move quickly and decisively across the entire system. Chaired
by Hammond, the team includes both physicians and administrators.
The team is working with each of the 28 specialties to develop and fine-tune
a contract template. This template will identify key issues for individual
sections and doctors, as well as for different hospitals, and will serve
as a guideline to the contract teamensuring that contracts are never
We need the direct involvement of each medical specialty in determining
our contracting parameters, Fox said. Each specialty has its
own coding and contracting nuances that need to be included in any managed
care strategy that strives for strong performance for our physicians.
Thomas Aaberg, director of the Emory Eye Center, enthusiastically agreed
for ophthalmology to be the first section to participate in the template
I thought it was very important for us to customize contracts in
order to do what is financially necessary for the departmentand
not find ourselves in contracts that were financially debilitating,
Aaberg asked ophthalmologist Theresa Kramer to oversee the project for
the Eye Center because she had long been a vocal proponent of shaping
contracts for specific sections.
As far as I am concerned, Kramer said, this whole process
has been a momentous advance in how the University deals with the onslaught
of managed care. If the managed care companies accept [our] template,
we anticipate we will eliminate about 30 percent of our front-end function
problemsthings like pre-certifications and referralsthus decreasing
the number of denials on the back end.
Finally, the managed care office did a market analysis to ensure
that the Eye Center maintains its competitive position both in the Atlanta
and the national market, Kramer added. I believe there are
very few comprehensive projects that will result in this scope of change
and the multitude of benefits that the template contract will yield.
Urology is currently going through the template process. One of
urologys primary objectives in working with this project was to
see if our managed care contracts could take more account of the complexity
of many of the patients we see, said department chair Fray Marshall,
citing complicated bladder operations on older patients who may have other
A single operation for such a patient can take more than eight
hours, and the patient may be in the hospital for 10 days and require
postoperative nursing instruction in the use of catheters far longer than
the usual 90 days covered by most managed care contracts, Marshall
said. Reimbursement doesnt always reflect these things, and
as a consequence many urologists lose interest in them, meaning more and
more such complicated cases arrive at Emory. Our goal is to provide these
and all our patients the best care possible, but we also need to work
out a reimbursement schedule that will let us maintain our high level
As doctors, Marshall added, we are very appreciative of all the managed care efforts because we dont have the time or expertise to conduct lengthy, difficult negotiations with the managed-care industry.