October 14, 2013

From Modern Healthcare

By Jessica Zigmond

Reporter Jessica Zigmond spoke to Polsinelli Health Care Chair Matthew Murer about post-acute providers shift to Medicare and Medicaid managed care-contracting.

Matthew Murer, chairman of the Health Care Practice Group at law firm Polsinelli, says post-acute providers are at a disadvantage in this process because they don't have the experience dealing with private payers in the way hospitals and physicians have in the past. Also, when it comes to Medicaid, post-acute providers could lobby their state lawmakers if they were unhappy with the Medicaid rates, but that's not possible when dealing with private insurers in managed-care plans. He also says this trend has led to consolidation in the industry, as smaller providers realize it helps to be part of a larger group of negotiations.

In addition, he says he expects to see bankruptcy filings in the post-acute segment in the next five years as some providers might accept lower rates with the hope that insurers will drive volume to their facilities. And that might not pan out.

"The trade-off in managed care is, I'll take the lesser rate, but you'll drive the volume to me," Murer says. "If I'm an orthopedic surgeon, I'll take 80 cents on the dollar, but I'll get more patients. You just have to be more efficient to see more patients. In long-term care, you can't get the same efficiency."

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