How Can Payers Support Providers Through Workforce Challenges?

November 16, 2023 - Although they likely existed before, the COVID-19 pandemic both highlighted and exacerbated workforce challenges among healthcare providers. Providers have implored federal leaders and agencies to increase support and resources as they operate amidst these challenges, but payers are also in a position to lend a hand.

A key workforce challenge providers of all specialties are facing is staffing shortages. Provider groups and hospitals have reported shortages of nurses, primary care physicians, allied healthcare professionals, and more. The Association of American Medical Colleges (AAMC) projects that by 2034 there will be shortages of up to 30,200 surgical specialists, 13,400 medical specialists, and 35,600 other specialists.

Other workforce challenges are driving factors behind these shortages. Provider burnout, mental health challenges, and poor compensation have contributed significantly to high turnover rates. The increased demand for healthcare workers during the pandemic, poor working conditions, and administrative burden have caused providers to feel burnt out.

As the other essential player in the healthcare world, public and private payers can support providers through workforce challenges by improving reimbursement models, providing resources to the workforce, and launching initiatives that address administrative burden.

Reimbursement model adjustments

Payers and providers are inextricably linked through reimbursement models, which determine how much money providers will receive from payers after furnishing care. There are several strategies payers can undertake that would improve payment models and generate better circumstances for providers.

Patients with complex care needs or chronic conditions often require additional care. Thus, payers should adequately reimburse providers for the time and services needed to care for these populations, as well as other populations with unique health needs. Adjusting payment models to properly account for this time may help address the issue of low reimbursement.

Similarly, implementing patient-centered payment models could benefit both providers and patients. According to the Center for Healthcare Quality & Payment Reform, under a patient-centered payment system, providers are paid for delivering the services patients need in the way that works best for the patient.

Additionally, under this kind of system, a provider’s payment should be based on what it costs to deliver high-quality care rather than on the fees paid in the past, the savings generated, or a percentage of total spending. Providers should also be paid more for patients who need more services or services that cost more to deliver in a patient-centered payment system.

Moving away from fee-for-service and adopting value-based payment models can also offer benefits for providers while improving the quality of patient care. Receiving reimbursement based on the quality of care rather than the quantity provided can help avoid overutilization. In some value-based models, providers receive financial and non-financial incentives for meeting quality measures.

Non-financial incentives such as greater flexibility to deliver care may support providers’ well-being, as it can contribute to their sense of purpose, mission, and professionalism, according to the Commonwealth Fund.

Value-based payment models with financial incentives may also attract more providers to the physician practice or hospital, potentially alleviating staffing shortages.

If payers can offer transparency about their reimbursement models—including whether they are value-based, what services they reimburse for, any incentives included, and specific payment rates—providers may have better workplace experiences.

Workforce resources

Aside from supporting providers through reimbursement models, payers can create initiatives that connect them to other vital resources.

Investing in education and training programs can help reduce stress for providers when it comes to learning new skills or using new technologies. Payers can partner with academic institutions or other entities to fund these programs.

Payers can also address shortages in underserved or high-need areas by offering loan forgiveness or financial incentives to providers who practice in those locations. In particular, payers could offer these benefits to providers who relocate to areas designated as health professional shortage areas (HPSAs) by the Health Resources and Services Administration (HRSA).

While payers have worked to facilitate access to mental and behavioral healthcare for members, they can also do the same for providers in their network. Payers can support mental health and wellness programs for providers that work to address burnout and stress stemming from their working environments.

The American Medical Association’s (AMA) physician wellness program includes discussions and mentoring sessions, resources to help identify and manage burnout, professional satisfaction surveys, and recommendations to improve health and happiness.

Payers could also partner with organizations to fund or launch these kinds of programs for providers.

Reducing administrative burden

Administrative burden is a driving force behind provider burnout and high turnover rates. With all the processes that providers must complete to file a claim and receive reimbursement, automating some tasks would likely alleviate some of this burden.

Prior authorization is one process that creates a substantial burden for providers. Payers can automate this process or incorporate artificial intelligence to streamline it, speeding up approvals. Automating claims processing may also reduce some burden for providers.

Seamless data-sharing is an ongoing challenge in the healthcare industry, but teamwork can make it easier. Payers can do their part by offering access to data that allows providers to identify challenges, optimize staffing, and improve patient care. Easier access to data may help streamline tasks and free up time for providers, minimizing administrative burden.

Through all the ways payers can help support providers as they grapple with workforce challenges, the two stakeholder groups must maintain a collaborative relationship. If payers and providers can communicate clearly with one another, they can work toward aligning their goals and strategies that help address workforce challenges.