AHA Endorses Delta Health Systems for Capitation Risk Management Services.

Business Editors, Health/Medical Writers

CHICAGO--(BW HealthWire)--June 6, 2000

The American Hospital Association (AHA) announces a program to improve the process of managing capitation risk. Through its subsidiary, AHA Financial Solutions, Inc. (AHA-FSI), the AHA has awarded its exclusive endorsement to Delta Health Systems (DHS) for their Capitated Claims Management service. DHS serves an essential role by providing quick and creative solutions to capitated claims (services rendered to groups of individuals that are pre-paid or capped at an agreed upon amount) and risk pool management (providing health care to individuals with a pre-determined amount of capital to pay for those services).

"Data is essential to the success of managing a full risk contract", said Tom Partlow, president of DHS. "Combining state-of-the-art systems technology with dedicated customer support, DHS provides the flexibility to accommodate risk pool needs by electronically integrating all key components required for capitation administration." DHS has established relationships with more than 40 HMOs to receive electronic eligibility and provide monthly electronic encounter reporting as required by HCFA.

DHS' clients receive monthly reports outlining the financial performance of each HMO contract and Medical Group partner. Their integrated services compile capitation revenue information, in-network and out-of-network claims data, sub-capitated health care expenses, reinsurance premiums and receivables, and administrative overhead for comprehensive reporting of risk pools. Monthly financial reports are prepared utilizing proven IBNR methodology.

Reinsurance protection is a vital component to managing capitation risk. However, capturing all potential "high-dollar" cases can be complex. DHS' sophisticated claims system accumulates provider payments by member for each reinsurance plan year. Automated reports are generated monthly for notification and submission to the carrier, broker and the client. Reports are customized to meet the contract parameters of each client.

"Capitation is an intrinsic part of today's managed care environment in several regions of the U.S. An organization's longevity is often determined by how well capitated risk is managed," said Tony Spohn, vice president of risk management for AHA-FSI. "Delta Health Systems' immediate access to reliable data provides health care organizations with management and measurement tools they need to be successful. This allows them to track financial performance and improve their capitation rate bargaining position with insurers," Spohn noted.

AHA-FSI and DHS will begin offering this program immediately to health care organizations nationwide. For additional information regarding the DHS' administrative services, contact Mary Gillard, AHA-FSI Account Executive at [phone] or via e-mail at [e-mail]. or Isabel Almanza, DHS Senior Account Executive at 800-422-6099 or via e-mail at [e-mail].

The American Hospital Association is a not-for-profit association of health care provider organizations and individuals that are committed to health improvement of their communities. The AHA is the national advocate for its members, which includes 5,000 hospitals, health care systems, networks, and other providers of care, and 37,000 individuals. Founded in 1898, the AHA provides education for health care leaders and is a source of information on health care issues and trends. For more information, visit the AHA Web site at www.aha.org.

AHA Financial Solutions, Inc. (AHA-FSI) is the insurance- and financial-product marketing subsidiary of the American Hospital Association. It functions as an industry advocate and resource agency to AHA-member hospitals and other health care organizations. AHA Financial Solutions evaluates the marketplace and collaborates with leading insurance and reinsurance companies to create products and services for health care professionals.

AHA-FSI has an exclusive sponsorship of the Healthcare Financial Management Association (HFMA), a professional association that includes more than 30,000 health care financial executives. For more information visit the Web site at www.aha.org/resources/aboutiri.html.

Delta Health Systems is an independent risk management firm located in central California. The company has been providing healthcare administrative solutions for self-funded plans, pre-paid legal plans, and pre-paid dental plans since 1968. They currently manage close to one million members, with over 525,000 capitated Commercial, Medicaid, and Medicare Risk lives. Over the years DHS has received numerous accolades and awards including TPA of the Year by a major reinsurer in 1998. For more information visit the Web site at www.deltahealthsystems.com.