The move toward a new health care economy is underway. Value-based and other alternative payment models are replacing fee-for-service. Health care organizations can succeed in this new environment by:
A new report from HIMSS Media based on findings of HIMSS Analytics, in collaboration with Cerner, discusses the evolving health care economy and how health care organizations are responding and succeeding. In the report, HIMSS combines interviews with health care leaders, insights from industry experts and statistical research to provide practical strategies and tactics to succeed in the new health care economy.
The evolving economics of health care delivery
The rules-of-the-road are changing, as the industry continues to move toward the full-scale adoption of value-based care models. Health care organizations need to dramatically change how they manage costs and performance and, perhaps most importantly, the relationship between the two.
Performance is quickly becoming the driver of revenue and is measured in terms of clinical outcomes, financial outcomes, reputation and staff and patient safety. All these metrics influence how much money flows into an organization. At the same time, the volume, type and charge-master price are losing their influence on revenue and margins under emerging value-based models. Cost reduction can’t come at the expense of patient care, and therefore can only go so far. Cost must be viewed in the context of outcomes.
Information that empowers
Today’s health care resource management is vastly more sophisticated, strategically relevant and challenging. Successful resource managers today seek to increase performance (quality, safety, satisfaction, revenue) while reducing cost by assigning the right types and amounts of resources (people, funds, materials, facilities, etc.) to produce the optimal outcomes. They ask, “how can we really get more performance for less cost?”
Figure 1. The new health care economics
The new health care economics shift provider organization’s financial strategy from revenue increases outpacing cost increases to “spreading the lines” between performance and cost.
Certainly, resource managers who confidentially participated in the HIMSS Analytics study were quick to recognize just how important it is to gain access to holistic information gained from integrated systems to manage the cost and performance spread.
“A single EHR and ERP provider system allows for consistency across the physician workflow,” said a director of financial planning and analysis at a Louisiana general hospital. To help achieve a tight integration, his organization uses Cerner clinical and revenue cycle solutions and Cerner for its application management of its ERP system as well. “This integration is making care delivery more efficient. Any time you are able to integrate systems, creating efficiencies is part of the process. These can be efficiencies for the care teams as well as for finance.”
The vice president and chief human resources officer of an academic medical center agreed – and added that culling data from an integrated system helps resource managers seamlessly pull in the data that they need. “It allows us to see a more complete picture and be more aware of the total organization and how we are all a part of it,” she said. “Being able to see the relationships and the tendencies helps us not be as siloed.”
In addition to providing a holistic view, integrated EHR, RCM and ERP systems help organizations streamline processes and more efficiently conduct the cost and performance analysis critical to success under value-based care.
Download the complete report for additional HIMSS research and interviews with numerous experts detailing real-world strategies, metrics and tactics to succeed with value-based care models in the new health care economy.