In part 1 of this article, we discussed the country’s growing focus on personal health and wellness following the pandemic, along with an uptick in chronic and acute health conditions. It’s a unique situation that highlights the increased opportunity for, and benefits of, developing strategic partnerships between physicians and other providers and clubs.
We noted that, in addition to being able to address a range of patients’ assessment, exercise, and nutrition programming needs, establishing strong referral partnerships can be a key part of a strategy for accessing new members who might not otherwise come to a club.
“There are decades of data indicating that a medical referral into a structured program often leads to memberships that stay engaged longer—up to six months longer, on average,” said Cassandra Stish, chief customer officer at Welld Health.
In the first part of the piece, we discussed the importance of building, and ways to build, those all-important relationships with healthcare providers. In this follow-up, we’ll explore what operators need to know about the complex healthcare insurance reimbursement system.
Ensuring Eligibility
A lot goes into working with the insurance reimbursement system, and the first consideration just might be mindset.
“As we know, not only do clubs need to prove their value to corporate customers but also to government, healthcare professionals, and more,” says Grace McNamara, BSc, MPH, EMBA, CEO at EXI, which offers medical software that automates personalized, safe, and adaptive exercise programs for people with sedentary lifestyles and chronic conditions. “The fitness industry needs to think more like the healthcare industry to warrant the same respect and investment.”
That thinking can help clubs meet the insurance industry’s typically stringent, orderly processes and requirements, which are not minor in this case.
“Ensuring eligibility for insurance reimbursement involves having accredited programs, adhering to healthcare regulations, and demonstrating program efficacy,” states Hal Hargrave, president and CEO of the Perfect Step exercise-based therapy centers. “Learning from the hurdles we faced, particularly in documenting outcomes and understanding insurance requirements, has been instrumental in navigating this process. We’re a prime example of how any organization, namely a health club or freestanding boutique facility, can position themselves to be considered for potential reimbursement, whether that’s through specific medical coding or through HSA/FSA dollars.
"The key thing that needs to be pursued and validated is the effectiveness of the ‘programming’ that you are planning for reimbursement on."
The Perfect Step, he adds, offers an inclusive program with specified protocols, approaches, and a unique methodology that simply can’t be adopted without hundreds of hours of training. Health clubs need to make sure that their staff, team, and employees are well educated, with continued education, certifications, and best-practice experience to position themselves in terms of positive word-of-mouth as well as quantitative and qualitative statistical data that proves outcomes through research and data collection initiatives.
It’s worth noting that gaining eligibility isn’t an easy process, regardless.
“Unfortunately, individual clubs or a small group of clubs in a market don’t often have the critical mass that will get them to an insurance executive,” says Kevin McHugh, regional vice president at Genesis Health Clubs, which has over 70 locations across the Midwest, Southeast, and Mid-Atlantic regions of the U.S.
"However, if you have clubs that dominate a state or metro area and can provide coverage throughout the state, there is a very good chance that you will be able to get their attention, assuming that you are staffed and have programs that address prevention, which saves the insurance company medical costs in the long term."
In the new world of insurance provider selections, he adds, the average insurance company does not keep a client for more than a range of three to five years; there are few examples where there is long-term loyalty to one insurance provider. In addition, if claims go up, the insurance provider raises their rates, usually with a percentage added to their profits.
"One of the biggest learnings may be for a club operator not to spend much time trying to get insurance companies initially, but to make their business better prepared by servicing their members and the community with non-insurance-reimbursable programs, which can lead to new memberships and retention," McHugh says.
That said, there are steps you can take to better align your facility or facilities with the reimbursement system.
