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  • 1. Health Insurance
    Health Reform
  • 2. Challenges
    Three principal regulatory currents are producing the impending change for Health Insurance:
    • The recently passed federal health care reform bill,
    • 3. New health care IT mandates from last year’s US stimulus package, and
    • 4. ICD-10, an expansion of coding standards for the exchange of health care data across payers and providers.
    Each of these forces will alter the way health care payers deliver services to patients and process the large flows of payments at the heart of the business.
    McKinsey Quarterly: The new IT landscape for health insurers, August 2010
  • 5. The legislation anticipates 30 million new individuals will join insurance rolls, while an additional 100 million will be shifting policies. The law will usher in a fundamental change to the industry’s business model.
    Today, payers mostly follow a business-to-business model: 90 percent of all private policies are paid for by employers that negotiate prices and terms of coverage. The recent legislation mandates new insurance exchanges, subsidies, and tax credits that will lead millions of consumers to contract directly with the health insurance payers.
    These companies will need to develop new consumer-marketing capabilities and consumer IT on a large scale—for instance, advanced Web capabilities, insurance exchange connectors, and customer-relationship-management (CRM) systems.
    The new legislation also mandates dramatic changes to risk pooling and pricing.
  • 6. Starting in 2011, the ARRA will provide $37 billion to hospitals and physicians making “meaningful use” of electronic health records, with penalties for those failing to do so by 2015.
    Much is at stake for payers as well with the advent of extensive electronic health records. … the payers’ will need to build substantial new systems that can readily interface with health information exchanges and analyze electronic health records.
    Using advanced analytics, payers can ensure that their networks use only medically proven and cost-effective treatments.
  • 7. ICD-10 … will replace ICD-9 and expand the available number of medical codes by a factor of eight. This change will enable a much more detailed description of diagnoses and treatments.
    While ICD-10 promises to improve the accuracy of medical management and claims, its adoption will force payers to undertake an effort likely to exceed that of the Y2K campaignas they expand the fields in their databases and support the new coding structure.
    ICD-10 will require payers to upgrade most of their existing IT applications, including those for adjudicating claims, managing medical cases, contracting with providers, preventing fraud, billing customers, and paying providers.
  • 8. Sounds a lot like Y2K:
    • Driven by external target dates
    • 9. Extensive impact on the corporation and the industry
    • 10. Requires widespread coordination of change
    • 11. Must keep selling and servicing existing business
  • Reform vs. Y2K
    Legislated date
    Impacts data and operations
    New players w/ data networks
    Complex definition of solution
    New customers
    New rules for customer interfaces
    New and more complex coding schemes
    Standards for data and interchanges are evolving
    Calendar date
    Impacted primarily data
    Almost no change in players
    Simple definition of solution:
    Recognize correct century
    For reform it is: September 2010
    For Y2K is was: December 2006
  • 12. The next step:
    A Project Management Office
  • 13. An Organizational View of a PMO
  • 14. A Functional View of a PMO
  • 15. Roles & Responsibilities
  • 16. External Interfaces
  • 17. Staffing
    PMO Executive
    Currently reports to a “C” level executive
    Access across the corporation
    Sensitive to the corporate culture; knows how to get things done here
  • 18. Staffing
    Regulatory & Standards
    Currently reports to a “C” level executive
    Access across Legal, Compliance, Regulatory Affairs, etc.
    Extensive regulatory and industry contacts
    “Knows the rules” and is effective in communicating what is required, why, and how it is different
  • 19. Staffing
    PMO Central
    Knowledgeable in PMO processes; neutral point of view
    Effective communicator and integrator
    Communicates what is needed and obtains commitments to perform
    A good role for an “outsider” to provide neutrality and additional perspectives
  • 20. Staffing
    Systems & Testing
    Currently reports to CIO
    Access across IT and related services
    Knowledgeable about current capabilities
    Committed to effective system and interface testing
  • 21. Staffing
    Operations & Change Management
    Currently reports to COO
    Access across Operations
    Knowledgeable about current organization and processes
    Manages business process redesign and implementation
  • 22. Next Steps:
    Identify the PMO Executive
    Initiate PMO staffing and planning
    Explore benefits of
    consulting support
  • 23. Hal Amens
    • Senior management consultant
    • 24. PMO planning and management experience
    • 25. Bank of America/Security Pacific merger; PMO design and communication; 15 month project, completed in 13 months
    • 26. Norwest Bank (acquired Wells Fargo) Y2K PMO planning and PMO Central role; 50 business units nation wide
    • 27. Knowledge Learning Corporation/ARA merger; 1,000 schools nationwide; managed PMO, completed on schedule and on budget
    • 28. HIPAA experience
    • 29. HIPAA security design and implementation two healthcare facilities
    • 30. HIPAA policy development assistance health insurance company
    • 31. Publisher: The HIPAA Implementation Newsletter, 400+ subscribers
    • 32. Host of two HIPAA implementation Webinars
    • 33. EMR experience
    • 34. Participated in EMR design and implementation planning
    • 35. EMRnet blog and other healthcare social networking
    Additional information and links are at:
    LinkedIn:  Facebook: (blog: electronic medical records): Writes (blog: examples of my work): Email:
    Cell: 424-242-5232 (Los Angeles)