3 keys to health exchange readiness

AHIP 2012: Exchanges call for strategic, market and operational/technical readiness, Deloitte Consulting says
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To successfully operate and sell plans on exchanges, payers must take numerous steps within a very tight timeline, focusing on three core areas--strategic readiness, market readiness and operational/technical readiness, a healthcare consultant said at the AHIP Exchange Conference in Salt Lake City Wednesday.

"There's going to be a lot of confusion in the market when exchanges open up," Alison Hagan, principal at Deloitte Consulting, told conference attendees. "Getting in front of that will be very critical."

Hagan said she doesn't think the looming Supreme Court decision will dramatically affect the new marketplaces, despite causing much uncertainty and readiness procrastination. "Short of completely overturning the entire legislation, there's still a lot of work to be done with exchanges, for example, if the individual mandate goes away," she said.

"That will hit a segment of the exchange population, but there's a significant population around subsidies that will likely be there regardless of the ruling." Hagan, therefore, urged payers to move forward with exchange prep, the high-court decision notwithstanding.

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"There's going to be a lot of confusion in the market when exchanges open up."

--Alison Hagan, principal at Deloitte Consulting
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To become strategically ready, she said, payers must establish their governance and organizational structure, create a road map and organize themselves. For market readiness, payers must assess the market landscape; critically examine markets to determine whether they're going to play, hedge or defer to participate; and define their go-to market strategy for different scenarios.

"That includes looking at what may happen in different states along the continuum of exchange types and what that means in terms of capabilities," Hagan explained.

Readiness in the operational and technical areas involves conducting a gap assessment to uncover payers' current operational and technical capabilities, determining whether those abilities can be translated into the exchange marketplace and analyzing gaps that potentially need investments.

Key to achieving readiness in all three areas, Hagan said, is flexibility. As new guidance or rules are published, payers should be able to "filter it back through your plan and take a look at it to see what does that actually mean for me in terms of readiness," she added.

Flexibility will be particularly helpful given the "very rigorous timeframes" payers have to prepare for exchanges. By the first quarter of 2013, for example, payers should have completed their market readiness and customer analytics. And then very shortly after, around the second quarter of 2013, they should be operationally and technically ready because testing should to be done to ensure a smooth operational flow come open enrollment in October, Hagan explained.

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