HEALTHCARE INDUSTRY MOST FOCUSED ON CONSOLIDATION, CONSUMERISM IN 2019

https://www.healthleadersmedia.com/finance/healthcare-industry-most-focused-consolidation-consumerism-2019?spMailingID=15535559&spUserID=MTg2ODM1MDE3NTU1S0&spJobID=1621654766&spReportId=MTYyMTY1NDc2NgS2

A new Definitive Healthcare survey polled healthcare leaders on the most important trends of the year.


KEY TAKEAWAYS

Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements last year, a trend that is not expected to slow in 2019.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to CEO Jason Krantz.

Widespread industry consolidation as well as the growing influence of consumerism registered as the most important trends healthcare leaders are paying attention to in 2019, according to a Definitive Healthcare survey released Monday morning.

Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Other topics that received double-digit percentages of the vote were telehealth at 13.8%, AI and machine learning at 11.4%, and staffing shortages at 11.1%. Cybersecurity, EHR optimization, and wearables rounded out the list.

The top results are generally in-line with some of the top storylines from the past year in healthcare, including focus on several vertical megamergers and longstanding business models being redefined by consumer behavior.

Jason Krantz, CEO of Definitive Healthcare, told HealthLeaders that healthcare is becoming increasingly more complicated and leaders are looking at a host of business strategies to navigate industry challenges or emerging market conditions.

“Something that’s on the mind of all of the people that [Definitive Healthcare] has been talking to, whether they are pharma leaders, healthcare IT companies, or providers, is that they’re constantly grappling with all of these new regulations, consolidation, and new technologies,” Krantz said. “[They’re asking] ‘What does that mean for my business and how do I address my strategy as a result?'”

In 2018, Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements, a trend Krantz does not expect to slow in 2019.

While Krantz cited some of the major health system mergers from last year as examples, he said another area that is experiencing widespread M&A activity is the post-acute care side.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to Krantz, and this is indicative of hospitals seeking to control costs and drive down rising readmission rates.

It also relates to another issue likely to accelerate in the coming years, which are the staffing shortages facing providers.

The sector currently suffering the most are long-term care facilities, which struggle to maintain an adequate nursing workforce due to the advanced age of most doctors and nurses in the face of the rapidly aging baby boomer generation. Krantz warns that all providers are likely to face these issues going forward.

Krantz also expects consumerism to hold steady as a top issue facing healthcare, citing the growing popularity of urgent care centers and the interconnection of telehealth services to provide patients with care outside of the traditional delivery sites.

However, the growth of these are reliable business options are all dependent on figuring out an adequate reimbursement rates for telehealth services rendered, Krantz said, which has not been fully addressed.

“I think until [telehealth reimbursement rates] get completely figured out, it’s hard for the providers to invest heavily in it,” Krantz said. “This is why you see a lot of non-traditional providers getting into telehealth, but I think it is something that people are thinking about and they know they need to adjust to, though nobody’s stepping up and being first in [telehealth] right now.”

For AI, machine learning, wearables, and cybersecurity, though the responses are split into smaller amounts, Krantz emphasized their combined score, which encompasses more than 25% of total votes, as a sign that healthcare leaders are paying attention to the area despite market complexity.

He added that they are all interconnected issues that deal with technological changes health systems are aware they will have to address in the coming years.

One issue related to harnessing technological change is EHR optimization, which Krantz believes leaders on the provider side are finally starting to gain excitement around. He said most leaders who have waited years to set up a comprehensive EHR system and input data are in-line to now utilize the data in their respective system.

“There’s a lot of great data in there and people are starting to figure out how to utilize that and improve patient outcomes based on the sharing of data,” Krantz said. 

 

 

 

Consumerism places ‘disproportionate burdens’ on patients to reduce cost, researchers argue

https://www.beckershospitalreview.com/finance/consumerism-places-disproportionate-burdens-on-patients-to-reduce-cost-researchers-argue.html?origin=cfoe&utm_source=cfoe

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Patient consumer metaphors place “disproportionate burdens” on patients to solve healthcare’s cost and quality issues, researchers wrote in a blog post published by Health Affairs.

Academics from the Hastings Center, a nonprofit bioethics research institute in Garrison, N.Y., wrote that patient-centered care messages have begun to mesh with patient consumerism. The authors note while patient advocates began using consumerism as a means to challenge corporate and professional dominance in healthcare, “today, ‘consumer-driven’ healthcare has become associated with neoliberal efforts to emphasize market factors in health reform and de-emphasize government regulation and financing.”

The authors continue: “In our view, a narrow focus on consumerism is conceptually confused and potentially harmful. The consumer metaphor wrongly assumes that healthcare is a market in the usual understanding of that term, that the high cost of U.S. healthcare is a function of excessive consumer demand, and that price transparency and competition can deliver on the promise of reducing costs or ensuring quality.”

The researchers concluded if the consumer metaphor continues, they believe patient-centered approaches, which can lead to improvements in healthcare, would be undermined.

 

 

Consolidating Retail Medicine: Positioning Single Specialty Practices for Acquisition

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Funded by Private Equity, the ongoing consolidation of solo and small-group physician practices into Physician Practice Management organizations reflects a maturing healthcare marketplace that is repositioning to deliver single specialty care services in retail settings.

Time is running out for solo and small group practices. To position themselves for successful consolidation transactions now and in the future, operators and buyers need to understand the fundamental market dynamics shaping valuations.

“Skin in the game” doesn’t work

https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2018.05018?stream=top&utm_campaign=newsletter_axiosvitals&utm_medium=email&utm_source=newsletter&journalCode=hlthaff

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Making people pay more of their health care bill out of pocket does not make them smarter shoppers, according to a new study published in Health Affairs, which corroborates earlier research.

The big picture: Part of the idea behind those ever-increasing insurance deductibles is that patients who have to put more of their own money on the line will become better consumers, comparison-shopping for the highest-quality, lowest-cost services.

  • But it doesn’t seem to work that way in the real world.

What they’re saying: In the Health Affairs survey of people with high-deductible plans …

  • Just 25% had talked to their provider about how much something would cost.
  • 14% had compared prices at multiple facilities.
  • 14% had compared quality metrics for multiple facilities.
  • 7% had tried to negotiate a price.

Between the lines: People don’t do these things because they don’t even think of it, or assume it won’t work. Or, to borrow some truly glorious academic-speak: “Perceptions of futility were common impediments to engagement.”

  • separate study, also published in Health Affairs, did find one effect of high deductibles: They seem to make women more likely to delay treatment for breast cancer.

Yes, but: There’s some evidence that if patients try to avail themselves of comparison-shopping tools, they can achieve real savings, at least for MRIs and other imaging procedures.

 

The Biggest Growth Opportunities in Healthcare

https://www.managedhealthcareexecutive.com/healthcare-leadership/biggest-growth-opportunities-healthcare?rememberme=1&elq_mid=5658&elq_cid=876742&GUID=A13E56ED-9529-4BD1-98E9-318F5373C18F

Healthcare growth opportunities for 2019 should pivot around the three big themes: digital transformation, value-based care, and patient-centricity, according to a new report.

According to Frost & Sullivan’s report, “Global Healthcare Market Outlook, 2019,” digitization of products, services, and commerce models are democratizing current healthcare systems, manifesting a new era of healthcare consumerism.

“Now the new vision for healthcare is not just about access, quality, and affordability but also about predictive, preventive, and outcomes-based care models promoting social and financial inclusion,” says Kamaljit Behera, transformational health industry analyst at Frost & Sullivan, and author of the report. “This makes digital transformation and realization of long-pending policies reform a key growth priority for healthcare executives and major health systems during 2019 globally.”

According to Behera, increasing pricing pressure and shifting the focus of the healthcare industry from a volume- to value-based care model demands that drug and device manufacturers elevate their business models beyond products to customer-centric intelligent platforms and solutions.

“In 2019, the healthcare market will continue to transit and stick into the value-based model,” Behera says. “More sophisticated outcomes-based models will get deployed in developed markets, and emerging nations will start following the best practices suited to their local needs.”

Despite the promise of digital transformation, the potential promise and actual commercial application still remain the poles apart from some of the most touted technologies like AI and blockchain, according to Behera.

“Current technology is often perceived to increase the barriers between patient and providers,” he says. “In order to bridge these gaps, healthcare executives need to change the debate around digital transformation and start look beyond the mirage of technology novelty and really focus on the outcomes.”

Behera predicts that these five areas will be the biggest areas of growth for healthcare in 2019:

1. Meaningful small data

Healthcare data analytics focus will shift from ‘big data’ to ‘meaningful small data’ by hospital specialty, according to Behera. “Increasing digitization of healthcare workflows is leading us to a data explosion along the care cycle, globally,” he says. “This makes insights generation from existing healthcare data for targeted use cases a relatively low-hanging opportunity relative to other emerging technologies. Additionally, health data being the ‘holy grail,’ the analytics solutions are considered the first foundational step to catalyze complementing technology promises leveraging healthcare data (e.g., artificial intelligence, cloud computing, and blockchain).”

Entailing this, Frost & Sullivan research projects the healthcare analytics market revenue to cross $7.4 billion in the United States by the end of 2020.

 “The key pivotal theme driving this growth opportunity includes population health management, financial performance improvement, and operational automation by patients, payers, physicians, and procedures,” Behera says. “Also, the rise of value-based care and outcomes-based reimbursement programs will continue to boost the demand for specialized analytics solutions.”

In 2019, payers and providers will continue to prioritize and leverage the potential of specialty-specific analytics solutions to investigate drug utilization, treatment variability, clinical trial eligibility, billing discrepancy, and self-care program attribution specific to major chronic conditions, according to Beherea.

2. Digital health coming of age with increased focus on individual care

“During 2019, we project application of digital health will continue to go far beyond the traditional systems and empower individuals to be able to manage their own health,” Behera says.

Favorable reimbursement policies (e.g., toward clinically relevant digital health applications) will expand care delivery models beyond physical medicine to include behavioral health, digital wellness therapies, dentistry, nutrition, and prescription management, according to Behera.

“For example, major insurance bodies are already using digital health services to communicate with patients,” he says. “Traditionally, lack of formal reimbursement processes is actually a deterrent to the uptake of these—wearables, telehealth etc. The next 12 months will see a relaxation of reimbursement rules for digital health solutions.”

The global aging population and an expanding middle class are major contributors to the chronic disease epidemic and surging healthcare costs, Behera says. “This year will be a pivotal year for defining value for healthcare innovation and technology for digital health solutions catering to aged care and chronic conditions management to bending healthcare cost curve,” he says.

“Telemedicine in emerging markets will become more mainstream and will aim to become a managed services provider [rather] than being just a telemedicine platform,” he says. “Telemedicine will move into the public health space as well, with countries like Singapore is testing the platforms in a regulatory sandbox. Finally, as the lines between retail, IT, and healthcare continue to blur, non-traditional players such as Amazon, Apple, Google, Ali Health, Microsoft, and IBM, among others, will continue to make further headway into the individual care space— providing the required impetus to public health systems to ensure accessibility and affordability of care-leveraging, patient-centric digital health tools and solutions.”

Healthcare executives should prioritize their roadmap for growing IoMT and connected health ecosystems (device-, wearables-, and mHealth-generated individual health data) in order to monetize these new sources of innovation and service-oriented future revenue streams, according to Behera. “The future focus should shift from drug and device mind-set to intelligent solutions/services, demonstrating outcomes-based health benefits to individuals and their caregivers,” he says.

3. AI

In next 12 to 18 months, the priority will be to bring AI/cognitive platform technology use cases closer to clinical care to augment the physicians and even patients with actionable decision-making ability, according to Behera. “In next two to three years, AI will become a common theme across all digital initiative and platforms.”

AI-based work flow optimization use cases will represent more than 80% of the workflow market contribution. These include:

  • The elimination of unnecessary procedures and costs
  • In-patient care and hospital management
  • Patient data and risk analytics
  • Claim processing
  • Optimizing the drug discovery process

“For example, Google is already at work to use machine learning for predicting patients’ deaths, and the results boast a flattering figure of 95% accuracy, which is better than hospitals’ in-house warning systems,” says Behera. “AI application across clinical and non-clinical use cases will continue to show hard results and further bolster the growth in the healthcare space in 2019.”

AI-powered IT tools that manage payers’ and providers’ business risks (including clinical, operational, financial, and regulatory) continue to be important for the market, according to Behera. “Across all regions in the world, AI-based cognitive technologies are proving to be the most useful for medical imaging and clinical diagnostics—as a decision-support tool—followed by AI application to derive intelligence on remote patient monitoring data to promote outcomes-based personalized care.”

4. Regenerative medicine

Cell-gene therapy combinations are rapidly gaining momentum, which make use of gene-editing tools and vector delivery systems to devise innovative curative therapies, according to Behera.

“There is also a pipeline of induced pluripotent stem cells (IPSCs), mesenchymal stem cells (MSCs), and adipose-derived stem cells (ADSCs) for novel therapeutic treatments for neurological, musculoskeletal, and dermatological conditions, among others,” he says.

These are poised for growth because rising pressures to decrease healthcare cost globally, the emergence of value-based reimbursement models, and healthcare digitization trends are transitioning the treatment model from “one-size-fits-all” to stratified and outcomes-based targeted therapies, according to Behera.

“Many factors determine the rate at which the stem cell therapy market advances,” he says. “It is driven by the success of stem cell treatments in curing life-threatening diseases such as cancer, heart diseases and neuromuscular diseases in the world’s aging populations. Emerging gene-editing techniques such as CRISPR/Cas9 that offer high precision, accessibility, and scalability, compared to other genome editing methods, such as ZFNs and TALENs for cell and gene therapy applications will continue to attract high investment both from venture capital and pharma companies.”

As regenerative medicine is redefining medical technology synergies by combining stem cell technology with tissue engineering, market participants should be investing in innovative models such as risk sharing, in-licensing/out-licensing deals, fast-to-market models, and in-house expansions, according to Behera.

“With cell-therapy manufacturing being time sensitive, biopharma companies should implement IT-based solutions for improved manufacturing capabilities,” he says. “Despite the promises with novel cell and gene therapies such as CRISPR/Cas9, questions around ethical application challenge its future potential. This makes it necessary for the life science research executives to work closely with regulators in developing guidelines and regulations [that will] guide ethical and real-word unmet needs of the healthcare industry.”

5. Digital therapeutics

“Digital therapeutics are about to become a true medical alternative that will utilize communication-based technologies, apps, and software to improve patient outcomes and help to lower the cost of healthcare,” Behera says. “Digital therapeutics offer the benefit to improve patient outcomes and reduce treatment cost by replacing the need for a drug or augmenting a standard of care, but they are not endorsed by a regulatory body, such as the FDA.”

Frost & Sullivan projects that the overall digital therapeutics market is to grow at a CAGR of 30.7% from 2017 to 2023.

“Digital therapeutics will become an exciting healthcare option that adds a curative dimension to technology,” he says. “As care for these chronic diseases expands in scope, prevention and recovery are becoming the new focus areas—apart from diagnosis and treatment. This demands a holistic view of individual health, lifestyle, and environmental data beyond the clinical health records to efficiently stratify at-risk patients for a preventive and targeted treatment paradigm.” 

Defining digital therapeutics appears at first glance to be a simple task, but challenges develop when attempting to define digital therapeutics as a market opportunity, according to Behera.

“Healthcare executives exploring the growth opportunities should prioritize their market positioning, which is often dictated by focused use cases (e.g., condition management vs. behavior management) rather than the technology novelty,” he says. “At present, many companies are either claiming to be or cited in the media as digital therapeutics, but only a small number of early-stage participants are seeking FDA certification based on randomized clinical trials. They make it critical for healthcare executives to keep a close watch on progressing regulatory developments, such as the FDA precertification program.”

 

 

 

Here come the Millennials!

We spend an awful lot of time in healthcare talking about the Baby Boomers. No surprise, America has spent decades—six-and-a-half of them, to be exact—contending with the impact of this historically large generation on nearly every aspect of our national life. From politics to economics to culture, the Baby Boom reshaped almost every facet of our society, and healthcare has been no exception. The fact that over 10,000 Boomers join the Medicare ranks every day means they’ll have a transformative effect on how healthcare is delivered and paid for—up to and including the sustainability of the Medicare program itself. So it may come as a shock to Boomers to learn that, starting in 2019, it’s no longer All About Them. This year America passes a new milestone: Baby Boomers are now outnumbered by Millennials. As the chart below shows, Boomers (whose average age is now 63), will be surpassed this year by America’s new Largest Generation. Born between 1981 and 1996, the Millennials are now 30 years old on average, and there are 72.5M of them, compared to 72.0M Boomers—a gap that will continue to widen. (Thanks to immigration, we have another 14 years until we hit “peak” Millennial, according to Census Bureau projections.)

This demographic achievement alone ought to earn Millennials a participation trophy—obviously, not their first. (Forgive the sarcasm…we’re Gen X-ers, it’s what we do.) But this changing demographic landscape brings big implications for healthcare. Boomers are just entering their peak “senior care” consumption years now, and we’ll have a quarter-century or more of very expensive care to fund for a generation that is by all indications more riven with chronic disease but more likely to live into very old age than previous cohorts. That creates the imperative for population health approaches that allow care for seniors to be delivered in lower-acuity settings. At the same time, however, Millennials are really just entering the healthcare system. For the next several years, most of their care needs will be driven by having babies and caring for growing families. But just as the last of the Boomers get their Medicare cards in 2029, the Millennials will begin to enter their “upkeep” years—demanding a variety of diagnostics, surgeries, and procedures to keep them thriving. Who will pay for all of that specialty care, and where will it be delivered? Today’s health system planners would do well to begin to look ahead to future capacity needs, and economic models.

The Millennials bring dramatically different service expectations as well. This is a generation raised in the era of Amazon. One-click purchases, same-day delivery, frictionless transactions, personalized offerings, low institutional loyalty—all of that will shape the way this generation thinks about consuming healthcare, with huge implications for providers. This is a high-information generation, whose adult years have seen a pervasive shift from physical to digital commerce, and they’ll expect healthcare to follow that trend. Ask today’s pediatric providers how different the Millennials are as parent-consumers—you’ll quickly get the picture. Even as physicians, hospitals and others scramble to retool care delivery to more efficiently manage the swelling ranks of seniors, they’ll need to keep a close eye on the preferences of Millennials, upon whom their future fortunes will rely, and who won’t tolerate the hurry-up-and-wait ethos that still pervades American medicine.

(Spoiler alert: waiting in the wings is Gen Z, digital natives born in 1997 and after. Guess what? There’s even more of them!)

 

Patient Financial Experience the New Focus for Revenue Cycle Tech

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Facing healthcare consumerism and high deductibles, providers are seeking revenue cycle technology to deliver a high-quality patient financial experience.

Hospitals and practices have traditionally relied on public and private payers to cover the bulk of patient charges and costs for their services. Everything from their revenue cycle technologies to billing workflows has been tailored to create cleaner claims, reduce denials, and collect payer reimbursement.

But in an environment of record spending and changing attitudes towards purchasing and payment, payers are starting to shift more financial responsibility to their consumers. Nearly 21 million Americans had a high-deductible health plan or health savings account in 2017, and AHIP experts anticipate enrollment in high-deductible plans to continue climbing.

Increases in patient out-of-pocket spending are driving individuals to become more discerning healthcare consumers who demand more value for the medical services they receive. Plans and policymakers argue that the rise in healthcare consumerism will ultimately result in lower cost, higher quality care.

In the meantime, however, high-deductible health plans and other increases in out-of-pocket spending are presenting challenges to providers who are not used to this new player: the patient as a payer.

Three-quarters of providers report that they are seeing a noticeable upward trend in what patients must pay out of pocket.   At hospitals, total revenue attributable to patient balances after insurance rose 88 percent from 2012 to 2017.

While payers have been steadily shifting the financial responsibility to consumers, providers have yet to adapt their workflows and systems to collect revenue from this new source while delivering a satisfactory experience to consumers.

For example, nearly all 900 healthcare financial executives recently surveyed by HIMSS Analytics said their organizations still use paper-based billing and collection strategies – despite the fact that the same survey revealed more than half of patients prefer electronic billing methods.

Patients in the survey even said they were more likely to pay their medical bills if they had the option to do so online.

In light of these statistics, providers are facing the difficult task of transforming their manual patient collection processes to address this changing, consumer-focused trend.

“What we’ve seen historically has been that the revenue cycle has been not as well funded or not as strategically prioritized for healthcare delivery networks. A lot of the decision making has been either reactive or more short-term oriented,” Joe Polaris, Senior Vice President of Product and Technology at the health IT company R1 RCM, recently told RevCycleIntelligence.com.

“But we’re starting to see more of a long-term strategic vision coming together for their revenue cycles,” he added. “Organizations understand they need to make transformative change in light of some of the challenges that are only growing in the market, especially the need to be consumer-friendly.”

Revenue cycle technologies that cater to the patient financial experience are part of that transformative change, added Matt Hawkins, the CEO of Waystar, the newly combined revenue cycle management company formed by ZirMed and Navicure.

“Innovators are beginning, more so than ever, to treat the patient as a consumer,” he said. “A lot of health systems are demanding or embracing services or technologies that get them closer to patients from the earliest interaction point.”

The demand for technologies that cater to the patient financial experience is on the rise. And providers could face significant financial losses and patient retention problems if they fail to adapt to healthcare consumerism.

Becoming a patient-centered entity that can collect what it’s owed without alienating its consumers is a significant challenge, experts agree.  But embracing a handful of high-impact strategies could help to ensure that both patients and their providers complete the payment process feeling satisfied.

PRICE TRANSPARENCY LAYS THE FOUNDATION FOR PATIENT FINANCIAL EXPERIENCE

“Consumerism” may be a popular buzzword in the healthcare industry, but providers still have a long way to go before their patients can accurately compare their clinical journeys to their retail experiences.

For one thing, patients often agree to services or procedures with no clear idea of what they will ultimately cost.

Providers rarely offer prices or price estimates to patients prior to service delivery. In fact, the percentage of hospitals that are not able to give consumers price estimates actually increased from 14 percent in 2012 to 44 percent in 2018, a recent JAMA Internal Medicine study revealed.

With patients expecting the ability to plan their expenses, providers are looking to implement new revenue cycle technologies that can deliver accurate cost estimates and boost overall healthcare price transparency.

“How do we give patients shoppable experiences, so they can find out the cost of an MRI?” asked Christy Martin, Senior Vice President of Product Management at Optum360. “In their local care market, where is the best place to go in terms of both quality and cost? Then, if they go to a certain location, what are they expected to pay based on their insurance coverage? What would the out-of-pocket costs be at this point in the year?”

Informing consumers of their patient financial responsibility before the point-of-service is critical for providers seeking to improve the patient financial experience.

“In the immediate future, one of the things that we can unlock using technology is an understanding upfront about what the payment responsibility will be, and have that help inform all of the things that happen subsequent to presenting that to the patient,” Hawkins said.

Providing price estimates up front helped one health system in Oklahoma increase point-of-service collections by $17 million in seven years.

The Consumer Priceline tool at INTEGRIS Health is a database of charges for most procedures and services. The health system also promises to deliver written price quotes to consumers within two days if the service is not already included in the database.

INTEGRIS may be seeing significant patient collection improvements using price estimates, but providers should be aware that databases like the Consumer Priceline tool require a wealth of historical financial data.

“In the immediate future, one of the things that we can unlock using technology is an understanding upfront about what the payment responsibility will be.”

Merely posting chargemaster prices for common services and procedures is not necessarily helpful for patients. Giving consumers information about their patient financial responsibility and out-of-pocket costs is supposed to prevent sticker shock. Yet chargemaster prices are primarily used to start negotiations with payers, and the numbers can seem exorbitant to consumers.

“Chargemaster prices serve only as a starting point; adjustments to these prices are routinely made for contractual discounts that are negotiated with or set by third-party payers. Few patients actually pay the chargemaster price,” the Healthcare Financial Management Association (HMFA) explained to policymakers in May 2018.

Despite reservations about chargemaster prices, CMS recently required hospitals to publish a list of their standard charges online. And providers are scrambling to understand how to present the information in a meaningful way to consumers.

About 92 percent of providers in a recent poll said they were concerned about the new hospital price transparency requirement, and the majority also expressed concerns about how the public would perceive their standard charges.

Now more than ever, revenue cycle technologies that aggregate and analyze information on what patients actually pay will be critical for health systems.

UNIFYING THE PATIENT FINANCIAL EXPERIENCE

Healthcare is nothing like going grocery shopping. Not only do consumers not have access to prices, but the funding mechanism for medical services is also vastly different from a traditional retail experience.

Unlike what happens during a retail transaction, healthcare consumers rarely pay providers directly for services or procedures rendered. Instead, healthcare consumers use insurance plans, health savings accounts, and a wide range of other funding mechanisms to eventually pay providers after a service is delivered. They may also receive several bills and benefit documents from providers and insurers before receiving the final bill listing their financial responsibility.

As patients become more responsible for their healthcare spend, the onus is on providers to simplify the patient financial experience if they want to boost collections and save their bottom line.

Delivering a navigable and consistent financial experience is key to making the most of the newly consumer-driven environment, Polaris advised providers.

“The patient wants to have a clear and transparent journey through the healthcare system, and that’s much more challenging when they have to navigate different departments on different systems, asking for the same data over and over again, never coordinating, and never communicating a holistic end-to-end experience,” he said.

Integrated and seamless revenue cycle technologies aim to deliver a consistent patient financial experience by simplifying medical bills and bringing all providers in a practice, hospital, or health system under the same billing brand.

For example, a multi-specialty physician group in central Texas boosted patient collections by 24 percent and reduced the amount of patient cash sitting in A/R from 14 to two percent in one year by unifying the patient financial experience across their organization.

“Even though we were one clinic with 60 providers, our collection process treated every healthcare encounter separately,” explained Abilene Diagnostic Clinics CFO Andrew Kouba, CPA. “Patients were receiving bills for each physician they saw, which allowed them to pick and choose which bills to pay. When you get four statements and you think you got one experience, you’re confused as a patient.”

Consolidating all of Abilene’s providers under one billing system helped the group to deliver a consistent patient financial experience, which in turn simplified the payment process for consumers.

Revenue cycle departments are finding that end-to-end systems or interoperable bolt-on solutions are worth the investment. The integrated technologies allow healthcare organizations to guide the patient through the financial experience.

But to truly advance the patient financial experience, revenue cycle technology experts agreed that clinical and financial data integration is also vital.

“Being able to leverage the clinical and billing data to provide a better patient experience all the way around is a key capability,” Martin of Optum360 stated.

“While hospitals are certainly focused on providing high-quality care, there’s also this focus on how they can improve the overall patient financial experience to reduce the confusion, complexity, and lack of understanding around patient responsibility. Health systems are looking to provide ease of doing business to address patient responsibility and reduce patient bad debt.”

Revenue cycle technologies that can leverage both clinical and financial data are crucial to transforming the patient experience into a consumer-friendly encounter. Understanding the whole patient can help providers offer a consistent experience from the front office to the billing department.

SELF-SERVICE AS THE ULTIMATE PATIENT FINANCIAL EXPERIENCE GOAL

Price transparency tools and integrated revenue cycle technologies lay the groundwork for a consistent, intuitive patient financial experience. But revenue cycle technology vendors are also observing an increased interest in self-service portals and kiosks for the ultimate retail-like experience.

The disjointed, manual processes involved in the patient financial experience have not been convenient for consumers. Patients often have to interact with a call center or sit down with a staff member to complete basic tasks like scheduling, filling out insurance forms, or paying a medical bill, Polaris explained. In other industries, these tasks have already been replaced by mobile apps or automated systems.

“With digital self-service, we automate tasks like they do in the airline industry,” he said. “We let the patient book an appointment right on their mobile phone, get all the paperwork, fill out the forms they need, and check in at a kiosk.”

“Automation takes repetitive tasks that are frankly not patient- or consumer-friendly out of the process and makes the whole healthcare experience much more satisfying,” he stressed.

Self-service portals and kiosks have the potential to truly transform the patient financial experience into a more convenient, navigable journey. But healthcare organizations would need to invest in large amounts of revenue cycle automation to achieve this goal, Polaris acknowledged.

“Automation takes a lot of forms,” he explained. “There’s always been robotics, user emulation, and basic automation to complete individual tasks. But very few organizations have driven automation of entire processes, and that’s where we’re seeing more investment in transformative automation.”

Healthcare consumers have already voiced their support for more self-service options and more automation. A recent survey of over 500 individuals showed that in addition to offering more payment options and sending simpler bills, expanding access to self-service tools was a top suggestion for improving the patient financial experience.

“Automation takes repetitive tasks that are frankly not patient- or consumer-friendly out of the process and makes the whole healthcare experience much more satisfying.”

Providers are also expressing interest in implementing the relatively new technology in the revenue cycle space. Kouba from Abilene Diagnostic Clinic in Texas said he wanted to create a type of Disney FastPass for the patient financial experience.

“We want to simplify the process from pre-registration through bill collection and try to automate that similar to Disney’s FastPass,” Kouba stated. “Disney is one of the best experiences of all time and when you go there, they want you to interact with the people, all their products, and just enjoy yourselves. The last thing Disney wants you to think of is the terrible lines.”

“If we can remove the pain points and strive to ease that front piece, the patient will be focused on a friendly conversation when they walk in the door with the person that can answer questions, rather than being pestered to pull out their wallet.”

However, Kouba is not convinced that full automation will take over the healthcare industry any time soon.

As much as adopting retail-style approaches can improve the patient financial journey, providers must still ensure their technologies and processes work for them, too.

For example, Kouba decided that self-service technology that automates scheduling is not ideal for Abilene.

“In our group, most of our physicians like to follow their patients to the hospital, so the difficult piece with self-scheduling, especially from the provider’s side, is their schedules depend on what their rounds look like for the day. It’s very difficult to get them to commit to blocks of time,” he continued.

Self-service and automated tools may still be maturing in the revenue cycle technology space. But providers still have the option to improve the patient financial experience through systems that estimate patient financial responsibility and unify the billing experience.

And providers should be looking to the revenue cycle technology market for help. The rise of patient financial responsibility has been steady. Deductibles and out-of-pocket costs have been growing, particularly since healthcare spending growth rates rapidly accelerate.

Implementing the right tools for their patients and their providers will be key to empowering patients to choose the highest value care while ensuring providers get paid for it.