RELATIONSHIP MANAGEMENT BETWEEN HMOs, AND PROVIDERS: MATTERS ARISING

BYDR (MRS) ADENIKE OLANIBA FMCPH, FAGP.CONSULTANT PUBLIC HEALTH PHYSICIAN

NATIONAL PRESIDENT HEALTHCARE PROVIDERS ASSOCIATION OF

NIGERIA (HCPAN).1

RELATIONSHIP MANAGEMENT BETWEEN HMOs, AND PROVIDERS:

MATTERS ARISING

Definition of Relationship Management:-

Relationship Management is a strategy employed by an organization in

which a continuous level of engagement is maintained between the

organization and its audience. Relationship Management can be

between a business and its customers (Customer relationship

Management ) and between a business and other businesses (business

relationship Management .

• It aim to create a way to identify potential cross-sales of products and

services.

It creates a partnership amongst the businesses involved.2

Definition of Relationship Management:- 2

The Relationship between the HMOs and Providers was supposed to be a business relationship which should have resulted in

• A better business process

• Improved Communication

• Better policies and procedures

• Mutual Cooperation

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THE HEALTHCARE PROVIDERS.

• These are Primary, Secondary and Tertiary healthcare facilities that are licensed/accredited by relevant authorities to provide services to the populace.

• NHIS Accredited Providers are those healthcare facilities that have been accredited by NHIS to provide healthcare services to its enrollees.

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THE HEALTH MAINTENANCE ORGANIZATION(HMOs)

A private or public incorporated company that provides health coverage with providers under contract. It differs from the Traditional Health Insurance by the contracts it has with its Providers.

• These contracts allow for premium to be lower, because the health providers has the advantage of having patients directed to them.

This occurs under the concept of Managed Care, but under NHIS enrollees are allowed to choose their preferred Provider.

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EVOLUTION OF NHIS.

The National Health Insurance Scheme (NHIS) was signed into law in 1997.

The statutory Instrument that set up the scheme is the NHIS Act 35 dated 10th May, 199.

Health Insurance in Nigeria was first mooted in the Parliament by the Halevi Committee in 1962 but no action was taken to actualize the concept.

Formal Launching of NHIS 1997 Formal flag off by General Olusegun Obasanjo of the Formal Sector

Programme took place on 6th June 2005.

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AIMS AND OBJECTIVE OF NHIS

Section 5 of NHIS Act 35 of 1999 sets out the objectives of the

scheme to include:

• Ensure that every Nigerian has access to good health care services

• Protect families from the financial hardship of huge medical bills.

• Limit the rise in the cost of healthcare services.

• Ensure equitable distribution of health care costs among different groups etc.

• The NHIS is a special social security arrangement based on concept of solidarity and equity

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OPERATION OF THE SCHEME

The scheme operates through four basic or major stakeholders with the following roles and responsibilities:-

i) Contributor:- Can be either an employee and or employer or any individual

- expected to make a determined contribution at specified time as prescribed in the plan.

ii) The Health Maintenance Organization (HMO) Limited Liability companies accredited by the NHIS solely to manage the provision of health care services through Healthcare Providers accredited by the Scheme.

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OPERATION OF THE SCHEME - 2

Effect timely payments to Healthcare Facilities. Ensure effective processing of claims (Secondary and Tertiary

Services) Carry out continuous quality assurance of healthcare

services Ensure timely approvals of referrals and undertake necessary

follow up to complete referrals Carry out continuous sensitization of enrollees Market approved health plans to employers/enrollees Collect appropriate contributions and make necessary

payments to appropriate pools in a timely manner Effects necessary returns to NHIS in line with the

Operational Guidelines9


iii) The Health Care Providers (HCPs) These are Primary, Secondary and Tertiary health care

facilities that are licensed/accredited by relevant authorities to provide services to the populace.

Secure appropriate Accreditation with NHIS Provide services as agreed with HMOs in the benefit package. Comply with NHIS Operational Guidelines Sign contract with NHIS through HMOs Ensure enrollees satisfaction Provide returns on utilization of services and other data to

NHIS through HMOs

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Report any complaints to HMOs and NHIS Limit the delivery of service to level of accreditation.

The Organization:

• The NHIS is the regulatory and supervisory body For Health Insurance in

Nigeria.

• Under the Scheme, health care services are paid for from the common

pool of funds contributed by the participants of the Scheme.

As evident from above, the roles and responsibilities of the HMOs, and

Healthcare Providers are highly significant determinants of the

successful implementation of the scheme.

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PARTICIPATION OF HEALTHCARE PROVIDERS IN MANAGED CARE AND NHIS-1

The concept of Health Insurance was quite alien to many Providers as a means of Health Financing.

Many Providers were used to the previous method of Out of Pocket payment and Retainership method especially in the Private Sector.

The paradigm shift affected many Private Practises adversely as many or all of their patients were swept under the Private Health Insurance Programme (Managed care ) inaugurated by the HMOs in the organized Private Sector.

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PARTICIPATION OF HEALTHCARE PROVIDERS IN MANAGED CARE AND

NHIS-2 Private Health Insurance Programme by the HMOs commenced in

the late 1990s before the take off of NHIS in 2005. In the early years of Managed care, the relationship between the

HMOs and Providers was far from cordial. It was viewed by Providers as a “Master-Servant” Relationship In response to this situation, some concerned Providers met to

discuss way forward At the end of their deliberation the Healthcare Providers

Association of Nigeria was formed.

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INAUGURATION OF THE HEALTHCARE PROVIDERS ASSOCIATION OF NIGERIA.

The Healthcare Providers Association of Nigeria (HCPAN) was formed in compliance with decree 35 of 1999 setting up the National Health Insurance Scheme (NHIS) with particular reference to part 1, section 11 subsection 2 (g) and part 11, section 6 subsection 2(c), 2(d) enumerating the role and place of providers in the country.

The Association was formally inaugurated on 12th August, 2004 and the attendance was highly commendable. The First Annual General Meeting (AGM) was held on 25th August 2005 and was formerly registered with the Corporate Affairs Commission (CAC) of the Federal

Republic of Nigeria in 2006. 14

AIM AND OBJECTIVES OF THE HEALTHCARE PROVIDERS ASSOCIATION

OF NIGERIA.

To moderate a smooth relationship between the Providers and all relevant

Stakeholders in Health Insurance Industry. These include the NHIS,

HMOs, NECA, NLC, and other relevant organizations.

To maintain high standard of health care delivery and provide quality care

for enrollees at affordable cost.

To ensure adequate compensation to the Providers for services rendered

for both capitation and fee for service. To ensure continuing education of the providers through Capacity

Building Workshops and Training on the varied operations of Managed Care.

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AIM AND OBJECTIVES OF THE HEALTHCARE PROVIDERS ASSOCIATION

OFNIGERIA-3

To vet contractual agreements between the HMOs and Healthcare Providers in Managed Care

To ensure the success of the operation of Health Insurance in Nigeria in order to improve the Health Indices of the Nation and the Achievement of Universal Health Coverage.

As you can see from the enumerated objectives above, the Healthcare Providers Association identifies with the aims and objectives of the NHIS in providing qualitative care to all Nigerians at affordable cost, We believe in the achievement of Universal Health Coverage for all Nigerians, however many challenges were identified in the implementation of both Private Health Insurance and the NHIS.

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CHALLENGES IDENTIFIED BY HEALTHCARE PROVIDERS

Since the inception of NHIS on the 6th of June 2005, there has been no review of the NHIS Act. The Operational Guidelines which has just been reviewed and released recently is still undergoing amendments. We believe that the reviews of these documents are long overdue. Other identified challenges include;

LOW CAPITATION /GLOBAL CAPITATION; We appreciate the fact that after a lot of advocacy the initial capitation of #500 paid by NHIS was reviewed to #750 in February 2012. This was 7 years after the commencement of the NHIS

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CHALLENGES IDENTIFIED BY HEALTHCARE PROVIDERS-2

Meanwhile in this same year there was partial removal of fuel subsidy. Minimum wage as at 2005 was #750 and as today it stands at #18,000 an increment of more than 300% yet capitation was reviewed upward by 36% does creating a huge deficit in funding at the Healthcare facility level.

ii) The capitation has not taken into consideration the disparity in the cost of goods and services and rent between the urban and rural practices in the country.

iii) The Association wishes that Global capitation should be expunged and that all Providers should be paid either as Primary Care Providers or Fee- For-Service for Secondary /Tertiary care Providers

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LOW FEE-FOR-SERVICE/TARIFF FOR SECONDARY CARE.

Participation of Secondary and Tertiary Institution in the delivery of Primary Care Services.

HMO Indebtedness to Providers/Slashing of Bills/Non Payment of

Capitation.

Registration of new lives should be done by NHIS and not by HMOs

Dual role of some HMOs Slow pace in the accreditation of Healthcare facilities by NHIS.

- Some facilities have been inspected but not registered

- Some have been accredited but do not have a single life 19

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Inequitable distribution of lives to Providers. More than 72% of Providers have enrollees less than 500 and these are in

the Private Sector. Complicated contractual agreement between the HMOs and Providers on

the Private Health Insurance( Managed Care). Provision for Arbitration Regulatory role of NHIS not effective. The need for Capacity Training for Providers and other stakeholders. A functional and informative website of NHIS/Robust IT Platform. Lack of participation of State and Local Government in the NHIS.

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RELATIONSHIP MANAGEMENT BETWEEN HMOs AND PROVIDERS-1

The HMOs and Providers are identified major stakeholders in the NHIS and Managed care

With different roles and responsibilities in the scheme.

Common denominator is to actualize the objective of NHIS to achieve

Universal Health Coverage.

Many identified challenges in Managed care and NHIS can be resolved

by a mutual collaboration between the HMOs and Providers.

The two most contentious issues between HMOs and the Providers are

the Low Capitation and abysmally low Tariff.

In order to improve the relationship between the two stakeholders the

following strategies were initiated by the Providers.

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1) Inauguration of a bilateral forum of HMCAN/HCPAN to review the challenges identified by HCPAN and proffer solution to them.

2) Constitution of a HMCAN/HCPAN TARIFF Committee to review the Tariff paid for Secondary and Tertiary care services, and the review of capitation upward

At the end of a crucial meeting of the committee held on the 28th April,. 2010 the Benefit package to be covered by capitation was determined. This included:-

(i) Registration (ii) G.O.P consultant (iii) Drugs for Primary care (iv) N.P.I

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(v) Admission for 24hrs with treatment with essential drugs.

(vi) Basic Laboratory Tests i.e. MP, Urine analysis, PCV/HB.

(vii) Minor O.P procedures – minor laceration, I & D, Dressing

(viii) Preventive care/Health Promotion (ix) Primary Dental Care (x) Simple Eye Test and Treatment It was also resolved that the capitation for the content

enumerated above should be #750 minimum. All HMOs were to go back and harmonize on minimum

premium based on new contact and cost

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All HMOs to review their contractual agreements with

Providers less Legal franca

HMCAN to Endeavour to get every HMO to become member

HCPAN to ensure all Providers become member

The Tripartite Committee (NECA/HMCAN/HCPAN)

The HCPAN observed after a year following the agreement as

above that many HMOs did not change their Modus

Operandum

- Capitation remained the same

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- Fee-for-service/Tariff not reviewed

- Private Providers Clinics were closing down as many could not

cope with the financial burden imposed on them by Health Insurance.

- HCPAN approached the Nigerian Employers Consultative

Association (NECA) to intervene in the dispute between HMOs and

Provider and as a result of this, the Tripartite Committee was

inaugurated in February 2011.

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The objective of the Tripartite Committee was to establish and continue a stable, peaceful and harmonious relationship between the members of HMCAN and HCPAN.

- To examine the areas of conflict among the two parties - To promote and enhance Health Insurance in Nigeria. - Several meetings were held by the Tripartite Committee which were

Presided over by the Director General NECA, Mr. Segun Osinowo. - In November 2011, the Tripartite Committee came up with a

memorandum of Agreement between NECA, HMCAN and HCPAN.

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MEMORANDUM OF AGREEMENT(MoA) BETWEEN NECA, HMCAN AND HCPAN

The Memorandum of Agreement was signed by the representative, of the 3 parties at NECA House on the 11th of November 2011.

The MoA consists of 16 section.Section: the objective of the Tripartite Committee was

adopted for the MoA.

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Particular attention is being drawn to section 8 of the MoA which recommended that HMCAN and HCPAN should continue dialogue on matters of Mutual interest. To this end a Joint Consultative Meetings between the representatives of HMCAN and HCPAN was recommended.

- Section 10 deals with Grievance Procedure. It enumerated 5 stages for the speedy resolution of grievances between HMCAN and HCPAN to ensure a harmonious relationship.

Section 14 deals with the Governing Law for the MoA which in all respect by and be construed in accordance with the Laws of the Federal Republic of Nigeria.

I am constrained to declare that this legal Instrument has not been fully utilized by the HMOs and Providers

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JOINT CONSULTATIVE MEETING BETWEEN HMCAN/HCPAN

In compliance with the recommendation of section 8 of the MoA a Joint Consultative meeting of representatives of HMCAN and HCPAN was inaugurated.

The inaugural meeting was held within the premises of Healthcare International HMO on the 13th of February 2012,

The Agenda slated for the meeting included:

1 Report on the implementation of the agreement between HMO and

HCPAN on Benefit Package under Managed Care proposed at the bilateral meeting held on the 28th of April 2010.

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JOINT CONSULTATIVE MEETING BETWEEN HMCAN/HCPAN - 2

Review of Capitation/Implementation of new NHIS capitation Review of fee-for-Service tariff diagnosis related tariff. HMO indebtedness to Providers/slashing of bills Free admission for the first 48 hours overhead cost challenges Care of the chronically ill Professional fees for Primary/Secondary care providers under Fee-

For-Service. Standardized contractual agreement between HMOs and Providers Dual role of HMOs.

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JOINT CONSULTATIVE MEETING BETWEEN HMCAN/HCPAN-3

Implementation of Memorandum of Agreement (MoA) of the Tripartite Committee

Setting up of arbitration panel Service levels

- Stigmatization of prepaid enrollee

- Acceptance of scheme with good intent by providers Data Managements-return of Encounter data to HMOs promptly Front desk management (patient flow) Arbitrary increase in tariffs Termination of service without notice to HMOs A.O.B

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JOINT CONSULTATIVE MEETING BETWEEN HMCAN/HCPAN-4

In order to fast tract review of Capitation and Tariff the

HCPAN forwarded the Report of its Tariff and Pricing Committee to the Forum for consideration.

No feedback has been received from HMCAN on this document. HCPAN believe that if the Agenda enumerated by the Joint

Consultative forum is positively addressed the relationship between the two stakeholders will improve tremendously.

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CONCLUSION

Providers are the people in the healthcare industry who are the custodians of the services to be purchased.

The HMOs who are purchaser of the services should negotiate favourable terms with providers for the beneficiaries.

The MoA should be utilised as a tool for policies and procedures in the management of relationship between the HMOs and Providers.

There must be improved communication and mutual cooperation between the two parties for effective and efficient implementation of Health insurance in Nigeria.

Nigeria Health Indices and healthcare system is poor compared with other countries with similar socioeconomic background.

The Presidential directive is to achieve 30% Universal Health Coverage by 2015.

We must all join hands together for the achievement of this goal. THANK YOU ALL FOR LISTENING.

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RELATIONSHIP MANAGEMENT BETWEEN HMOs, AND PROVIDERS: MATTERS ARISING

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