Make Your Medical Facility Profitable with a Focus on Value-Based Care
The adoption of value-based care is expected to account for 59 percent of healthcare payments by 2020. In addition to that, organizations that keep operating business as usual and do not make the switch to value-based care are expected to have -15.8 percent margin by 2021.
How Value-Based Care is Changing the Healthcare Industry
There once was a time when all that mattered to healthcare providers was the number of patients that they billed and the number of services rendered was the main focus (volume-based care). Now, the focus is shifting towards how well patients are treated and their overall health outcome. Below is a bit more explanation on these two forms of care.
Simply put, volume-based care, also known as fee-for-service care, refers to the payment a medical facility receives for services a patient might need where the type and quality of service do not affect the amount a provider might receive.
One of the major drawbacks of volume-based care is that health care providers are more incentivized to worry about the number of patients that are cared for and adding on services that are not needed.
On the contrary, value-based care, sometimes known as accountable care, focuses on the quality and value of the services provided and places emphasis on preventative care, as well as specialized care among other things.
How to Implement Value-Based Care
Value-based healthcare can be broken up and classified into four categories that can then be implemented by a care provider in several ways:
1. All Departments Share the Risk
In this category, all departments share the risk. This allows all departments to work collaboratively toward keeping their spending at or below their budget and keep overall costs down when providing quality care.
2. Offer Contact to Patients
This has been around for quite some time. This methodology offers short-term and long-term patients alike individual contracts that are unique to each patient and based on a per month model, sometimes referred to as PP/PM. This helps defer some of the costs while still ensuring each patient receives the treatment they require without the financial strain.
3. Bundle Service Offerings
Bundling is another tool that can help health care providers cut costs where patients can determine what services they do and do not need and determine what is most important to them. Bundling essentially allows each patient to personalize their care and allows the healthcare facility to save money by not having to render certain services should the patient not request them.
4. Shared Savings
Lastly, shared savings is another approach to value-based care that allows money to be saved across all departments and organizations that can cover the costs of others. This method, similar to the ones above, allows the organization to still have the ability to reach budget goals while being able to focus on the actual care itself.
In order to effectively implement a value-based health care model, it will require re-alignment of processes so that they design and deliver proactive care and prevention, technological access provided to all clinicians, organized and efficient collaboration, and a variety of resources made readily available to all patients to ensure they have fast and easy access to preventive and acute healthcare.
How Outsourcing Can Improve Care and Revenue Cycles
While value-based care is a no-brainer, revenue cycle management can be difficult to navigate and one can greatly affect the other. Most healthcare providers are committed to making alternative payment models work. About 23 percent of those surveyed expected to connect half of their payments to a value-based care model by the end of 2019. Many will need to refocus their healthcare revenue cycle management strategies to include more data analytics tools, population health management, and better patient billing techniques.
Outsourcing may be the way to go for some medical facilities looking to improve their current system and see a measurable improvement to their bottom line with value-based care in mind.
Outsourcing revenue cycle management to a third-party is a cost-effective way for healthcare providers to quickly improve their financial performance. Naturally, a well-managed revenue cycle can increase cash flow, reduce cost-to-collect, and provide greater point-of-service collections with fewer denials.
By outsourcing revenue cycle management, an outside party will assume responsibility for revenue cycle management processes such as claims processing, denials management, and account resolution using experience, knowledge, and a more personalized approach when interacting with patients.
Outsourcing allows health care providers to choose how they use solutions to address particular needs while allowing hospitals and medical care facilities alike to focus 100% of their time and money on effective patient care.
Successful implementation of value-based care will be a long journey for any healthcare system, but progress and measurable results can be expected, despite the ongoing fragmentation in the current American healthcare system.
As with any business, a care provider’s revenue cycle must continue unfettered so that the facility remains financially viable – especially during a transitional time. The Midland Group works closely with all provider personnel and patients to ensure that medical facilities remain profitable while they focus more and more on value-based care. Contact our team today for more information.
