What Is an MSO and How Does It Benefit the Health Population?

An In-Depth Analysis of What Is an MSO’s Key Function

The main goal of an MSO is to help enterprises that work together in taking on risk. This is mostly true for contractual payers and regulators who provide administrative infrastructure, scalability, and technology. As part of managed care agreements, risk is starting to move from health plans to providers. The health system now owns and administers the different functions and services that health plans used to handle, like clinical outcomes. Working with a managed care organization is one of the best ways for a medical practice to spend less money on care.

MSOs come in different shapes and sizes, just like the services they provide. An MSO is board-controlled, has a structure, and functions uniquely for the risk-bearing institution it was founded for. Depending on its needs, a risk-taking organization can build or outsource an MSO for a single function or service or for many functions or services.

Shifting the Risk and Responsibility

Why is it important for the healthcare system that providers take on financial risk and make care models that are integrated and coordinated? According to the Integrated Healthcare Association, these provider delivery models are superior to typical fee-for-service (FFS) networks. The data shows that these risk-bearing providers who work in an Health Maintenance Organization (HMO) coverage model offer better care at a lower cost per person. This saves every organization and institution billions of dollars every year.

MSOs have given physicians actionable data analytics. This can help them find patients who are at risk so they can take action to improve their health. They've added care coordination employees, compliance knowledge and people to manage, scheduling and outreach for patients, provider education, audits, reporting, and legal contracting assistance. One important thing to remember is that MSOs offer services and capabilities that are tailored to the local area. This is because good health care is always local.

Implications of Establishing an MSO

One strategy providers employ in order to create economies of scale and cost savings, while at the same time maintaining their practice’s independence, is to form MSOs. Several advantages accrue to a health system when it establishes an MSO:

Better Efficiency and Price
An MSO's centralized care office makes standardization of care management throughout an organization possible. A consistent governance structure simplifies member identification, risk categorization, attribution, care management delivery, staffing, and population health reporting and analytics. Centralized performance and quality improvement allow for network-wide assessment and course correction on a regular basis. In order to take advantage of this actual potential, an MSO that offers these services must be in a position to do so.

Effects on Scale

When administrative and management responsibilities are consolidated, they become more efficient, creating a monthly economy of scale for each employee. MSO encourages the health system to look for partnerships that can boost membership and cut per-member-per-month (PMPM) management expenses by generating economies of scale.

An Incentive for Expanding the Network

MSO can be an attractive incentive for health organizations looking to grow their provider network. Because it relieves the provider of administrative and managerial duties, a strong MSO has a competitive advantage in the market.

A Multi-Payer Health Care Plan

Moving administrative responsibilities away from the health plan and into an MSO can help health systems operating in competitive, multi-payer situations. It's easier to control medical costs when the bulk of administrative tasks are in your hands. An MSO that is both payer agnostic and firewalled gives managed care organizations (MCOs) peace of mind during contract negotiations. They can also help maximize the percentage of global risk that the risk-bearing entity has access to, including the possibility of capitulation.

A large group of physicians in the United States has traditionally opposed risk-based payment and managed care. In addition, there are major obstacles to admission into the market for providers prepared to take on the risk. Many physicians prefer to remain in a FFS model rather than take on financial risk. When doctors assume financial risk for their patients' outcomes, they perform better and contribute more to the healthcare system. The model of value-based payment is the reason why Medicare has shifted away from FFS payment. It has resulted into what is an MSO’s primary function today.

MSOs may benefit from the customizable user interface (UI) provided by QuickCap 7 (QC7), which can conduct both simple and complicated administrative chores while helping MSOs to cut down on needless fees and expenses.

Health plan auditing, main and specialty capitation payment structures, and automated claim adjudications are just some of the features provided by MedVision's QC7, the administrative and management platform that you need with strong HIPAA-based, encryption-enabled security.

Improve the delivery of healthcare services!

Reference:

1. Milliman, Chris Girod, July 16, 2018, Healthcare Under the Delegated Risk Model in California: Lower Cost, Higher Quality. Accessed at https://www.healthcaretownhall.com/?p=9535#sthash.qlBOGSPx.dpbs.

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