Pay for Prevention: A Strategy for Healthcare Prevention Shows Promise

With all the talk of healthcare or health insurance reform. There are lofty goals and a likelihood that cost will increase.  We will need to think outside the bx to have any real impact on healthcare cost. An idea that focuses on personal responsibility and health as opposed to illness is Pay for Prevention. A few large employers are working on Pay for Prevention. Pay for Prevention is a new strategy aimed at eliminating chronic health conditions associated with bad behavior by offering monetary incentives for leading a healthy lifestyle.  Recent studies have shown that 50 percent to 70 percent of the nation’s health care costs are preventable.  Such costs are usually associated with bad behaviors such as diet, lack of exercise, and smoking.  Healthcare providers, Insurers, and Employers are all jumping on board and the latest indications show that rewards for good behavior are much more effective than punishments for bad behavior.

Preparing for the changes in healthcare: Part 2 Operational Improvement

Both healthcare providers and payers are under a lot of pressure due to rising costs as well as governmental requirements and regulations. To better serve their customers and to stay ahead of the challenges, health care enterprises must improve their operational as well as financial performances. Many organizations will have their own in-house consultants or management team, but not all. Any health care organization will benefit from seeking healthcare management consulting to improve their strategies and achieve their goals.

Congress passed health “insurance reform” on Sunday night and the President will sign into law shortly, we as both consumers of healthcare as well as those who work in healthcare will see changes as costs go up and government increases its regulatory role. It is also likely that reimbursement will decrease. It will be interesting to see how it all unfolds over the next few years but preparing for the future is now even more important. Not only is the financial aspects critical but making sure your healthcare organization is running at peak efficiency is critical.

Improving Operational Performance
The operational aspect of a health care organization must also be strengthened through the help of healthcare management consulting. With a strong backbone, organizations can implement the right programs and services. The organization can set new goals in order to increase effectiveness, efficiency and productivity.

With these elements in the right place, the programs can better serve the customers and provide higher quality care. With a new focus, the organization will meet government regulations and have enhanced ways of communicating with physicians and other health care professionals.

Preparing for the changes in healthcare: Part 1 Financial Improvement

Health care organizations are under a lot of pressure due to rising costs of health insurance and governmental requirements and regulations. To better serve their customers and to stay ahead of the challenges, health care enterprises must improve their operational as well as financial performances. Many organizations will have their own in-house consultants or management team, but not all. Any health care organization will benefit from seeking healthcare management consulting to improve their strategies and achieve their goals.

Health care is a business and those running the show must understand how to manage the business. This means that administrative information, financial data and clinical data must be taken and analyzed in order to put the information obtained into new strategies and other actions. In other words, health care managers need access to this information in order to understand the nature of the business.

Improving Financial Performance
By working with healthcare management consultants, a health care organization will be able to better manage its operational costs, present new growth opportunities, and ultimately increase revenue. With better financial performance, an organization can provide better health care to patients and eliminate problems with cash flow.

Competition is high in the health care industry and optimized financial performance will put an organization above its competitors. With healthcare management consulting, an organization can have access to necessary tools and data analysis.

Improving Healthcare Profitability for Providers Part 5: Putting It All Together

I hope the past week’s postings on ways to improve healthcare profitability was useful. If you have questions we do offer free consultations. The areas covered include a number of  tips that if implemented can improve your companies bottom line fairly quickly.  These include reducing no shows, collecting at time of service, improved coding and ways to optimize collections for third-party payers. We have found that by utilizing even a few of these techniques that practices can increase revenue  by at least 10 to 25% with little to no increased expense. It is important to utilize technology as much as possible. For example the importance of submitting claims electronically not only decreases time from submission to payment but allows claims to be pre reviewed ( scrubbed) for errors both on the practice end as well as the payers end.  Thus errors are found in hours or days as opposed to weeks. An efficient claim shop can have the errors corrected and resubmitted before the next claims submission cycle.

Please email or write comments about this series or future blog post that could be helpful.

Improving Healthcare Profitability for Providers Part 2: Point Of Service Payments

Yesterdays post focused on improving profitability by decreasing no shows.  We outline four main methods to reduced no shows immediately.  Today I will discuss the importance of point of service (POS) collections. For many practices the proportion of POS payments has grown from 15-75% . These systematic POS collections often yield double-digit billing performance improvements. Payment collection performance can vary greatly depending on elapsed time between service and payment. Payment collection  grows more difficult as perception of value decreases with service memory thus the importance of collecting at time of service.

Practices that do not employ a payment at time of service policy will spend many hours on unpaid invoices. When there is a POS policy that is working In-office collections reduce costs in the following ways: 

1.Mailing out statements

2. improved collection rate

3. Improved cash flow

A  successful POS collection policy includes the following:

1. Reminding patients about payment policies when they call to schedule helps them take financial responsibility

2. Be clear and strict about your policies – no co-pay, no visit

3. Allow hard-pressed patients to set up installment plans for more sizeable bills

Making Point of Service Payments Easy

1.Collect co-pay at check in. Make sure front office staff has any unpaid balance information so they can collect that amount as well.

2.More effective than sending statements. Sending statements actually cost $2 to 5 per statement. Thus if you have to send out two statements to collect at $10 to 20 co-payment it may cost the practice up to half of what it may ultimately collect.

3.Make sure office is able to accept all forms of payment –Check –Credit card –Cash

It is important to set organizational goals

1. Collecting balances is numbers oriented so setting quantifiable work goals helps produce results

2. Set both organization wide, and more specialized or individual staff goals

3. Set detailed goals for the process of collection

4. Award employees for meeting collection goals. Some companies give individual bonuses, and or practice wide bonuses.

A well done POS payment plan will lead to significant gains.  I was working with a practice and they were not collecting copayments well. After a careful review it was determined that each month this practice was not collecting at least $20,000 per month.  It was alarge high volume practice. The copayment for each patient was small, ” just a few dollars” so front office staff as well as management did not focus on the process.  It is important to make sure all key processes are at peak performance as each builds on the other and all are needed to run an efficient profitable health care practice.

Heart Attacks Increased with Depression

The NYT reported on February 24 about increased heart attacks after job loss.  Numerous studies have reported on stress, depression, and  job loss increaseing heart attack risk. The latest study in 2009 led by Sarah A. Burgard, a professor of sociology and epidemiology at the University of Michigan, found that “persistent perceived job insecurity” was itself a powerful predictor of poor health and might even be more damaging than actual job loss.  We recently posted a blog on behavioral health prevention.  We have a series of behavioral health prevention articles on our website that address several areas of behavioral health prevention.  I suspect that although the new mental health parity rules just release will dramatically increase healthcare costs one benefit may be increased behavioral health prevention of  other medical illnesses such as heart disease. We at BHM can help develop cost-effective management programs using detailed data analysis to improve cost effective care.  I will be posting more articles on this topic as reducing health care costs while maintaining quality is a national debate.