Managing Transplant Risk: Options for Specialized Coverage
 by Charles Crispin, President & CEO, Evergreen Re

Since the inception of managed transplant insurance, we have seen many clients benefit greatly by “carving-out” and eliminating their financial risks associated with the growing number of transplants. By doing so, they have not only converted this unpredictable and potentially catastrophic risk to a flat monthly cost, but are also providing the best possible care for their members. As Elizabeth Dixon, RN, PhD, points out in her recap of medical innovation in this area, “successful transplantation requires a lifetime of medical care”.

From 100% carve-out, first dollar coverage to a variety of risk sharing options and program refinements, managed transplant insurance can be tailored to individual needs. Some of the key elements include access to the most qualified transplant providers in the country, caring nurse advocates to guide patients through transplant episodes of care, including pharmaceutical needs and outpatient services, claims coordinators to provide accurate adjudication of claims and customer service programs ensuring quality control.

With carve-out insurance, risk is typically transferred on a first dollar or very low (i.e. $10,000) deductible basis as soon as a covered employee is identified as needing a specific service. For organ transplantation, specialized programs also offer the benefit of covering the full episode of care, which may last many years. This spectrum of coverage offers a much different range of features than a basic reinsurance agreement or stop-loss policy, which restricts reimbursements based on incurred and paid dates and offers very little in the way of specialized case management.
An additional benefit of some carve-out insurance programs is the transfer of medical liability. In many cases, the managed care organization’s financial risk and medical-management liability is transferred to the carve-out provider.

Carve-outs continue to be a valuable tool for health plans and other large payors and new programs are emerging quickly, particularly in the area of neonatal risk. The strategic use of carve-outs provides added predictability and transfer of liability while enhancing continuum of care and benefits for employees.