Healthcare is a major expense worldwide and is estimated to account for $3 trillion in spending in the United States, and $6 trillion globally.
Combined healthcare spending in the five major world regions is expected to reach 8.7 trillion by 2020, up from $7 trillion in 2015. Global healthcare spending is projected to increase at an annual rate of 4.1 percent in 2017 through 2021, up from just 1.3 percent in 2012 through 2016. Aging and increasing populations, developing market expansion in advanced medical treatment, and rising labor costs drive spending growth. Still, global costs will vary wildly.
Per-person healthcare spending will span from $11,356 per person per year in the U.S. to just $53 in Pakistan in 2021.
Unfortunately, higher spending levels don’t always produce better health outcomes and value. For example, the United States continues to spend considerably more on healthcare (16.9 percent of GDP in 2016) than comparable countries, but it is in the lower half of the life expectancy rankings, according to the Organization of Economic Cooperation and Development (OECD). Historically, the United States healthcare payment system has been predominantly a fee-for- service model, and this has enabled a model of healthcare whereby a large driving force is obtaining profit. This has undermined the consumer-centric nature of the healthcare field.
The U.S. healthcare system is currently perceived as experiencing a growing crisis in terms of the level of access it provides, its costs, and the quality of care provided. Globally speaking, access to quality healthcare has reached crisis levels in many developing nations.
A Global Crisis
From a global perspective, most nations on the planet are too poor, and their healthcare system too disorganized, to provide any kind of efficient mass medical care. Clearly, such systems go against human ethics and create an even greater disparity—widening the gap between rich and poor. The rich can afford healthcare, while the poor stay sick or die. Even worse, in rural regions of Africa, India, China, and South America, hundreds of millions of people go their whole lives without ever seeing a doctor. They may scratch enough money or barter to obtain some medical advice, or only have access to a village healer using home remedies that may not be necessarily effective against disease.
Ironically, only the industrialized countries—perhaps 40 of the world’s 195 countries—have established healthcare systems, consolidated within each nation (Beveridge, Bismarck, National Health Insurance, and out-of-pocket ). Almost all nations have a variant or fusion of these models, but there are still issues in every system despite the policy-makers’ best efforts.
The Beveridge Model, for example, is not in the best interest of the people. It relies on very high taxes for basic healthcare, without providing access or incentives for preventative care, thus raising the bar of healthcare expenditure. The lack of individualization forces healthier people to be charged the same amount as the fatally sick. Canada is a highly cited example of a nation using a Beveridge Model.
The Bismarck Model, on the other hand, uses an insurance system which is usually financed jointly by employer and employees through payroll deduction. This system causes higher costs of healthcare and diminishes efficiency. Cost issues are often addressed by raising premiums instead of controlling prices. While the fixed price for procedures helps to control costs, the quality of healthcare from different providers varies. Most healthcare services are covered by a mandatory health insurance; beyond that, the patient co-pays for a portion of care at the time of treatment. This system, utilized in Germany, is flawed as it offers no alternative to compensate individuals for the rising costs implemented by the government, pharmaceutical, and private insurance companies.
The report is Kaufman Hall’s second annual in-depth look at the priorities and progress healthcare executives are making in reducing organizational costs. The 2018 report shows that hospitals will need to take big strides and tackle more transformative initiatives. Progress is being made on some fronts, but it is slower than what many experts consider to be required of hospitals and health systems.
Increasing leadership accountability
Evidence of progress can be found in the following:
58 percent of responding executives say their organizations have processes and structures in place to hold health system leaders accountable for performance in reaching cost transformation goals, up from 46 percent in 2017
56 percent say their organizations make effective use of clinical pathways, protocols, and guidelines to develop a common approach to treatment versus 47 percent in the previous survey
Additionally, 73 percent of responding executives say cost transformation improvement targets have been distributed across the organization, up from 53 percent in 2017
“U.S. hospitals are facing increasing pressures, so these percentages need to be much, much higher,” said Lance Robinson, managing director at Kaufman Hall. “The combined effect of the shift to a new business model, competitive pressures from expanding health systems, new retail options that are siphoning off high-margin services, and the need to raise capital for strategic growth initiatives is quickly putting hospitals in an untenable position.
“Our hope is that this new report helps healthcare executives see where they stand in relation to their peers — and that progress needs to be made in most organizations,” he added. “We also hope it provides actionable insights to help them accelerate their cost transformation efforts by tackling initiatives such as eliminating, repurposing, or redesigning capital-intensive, inefficient structures, programs, and processes.”
Cost reduction still focused on traditional targets
Among the key findings is that most of the cost transformation that has occurred so far has been in traditional cost reduction areas such as supply chain and other non-labor costs, where 64 percent of executives reported a reduction of three percent or more since 2017. Little progress has been made, however, in areas with the greatest potential for transforming cost structure, such as service rationalization, where 61 percent reported no progress in the past year, or reduction of inappropriate clinical variation (46 percent).
The numbers skewed even higher for organizations with more than 10 hospitals, with 60 percent reporting no progress in reducing inappropriate clinical variation, and 57 percent saying no progress has been made in improving physician enterprise management (versus 44 percent overall).
Getting the right health insurance is tricky. You need to mind a few things to assure you sign the right contract between you and the insurer. Following, we will discuss a few tips that will help you find the ideal insurance package according to your needs, budget, and the market landscape.
Evaluate Your Condition
Health insurance is a commitment. You may have to pay more than you need, and it suggests you don’t have the right coverage. The following tips will help you.
Know Your Needs
Do you have any major plan, and want additional benefits? Try to lower out of pocket expenses or find another pan that suits you.
If you are starting your project and want a plan designed for self-employed workers, then consider a long-term plan. If you lose your job or landed in a temporary situation, then you will be better off with short-term insurance. Short-term insurance can last anywhere between one and six months.
Do you visit the doctor often, or do you depend on the insurance to take your care? Do you have scheduled appointments with a doctor or not? You need to consider your medical needs and expenses recently. Mention your medical condition, history, and medicine. This will you get an idea of what to look for.
Are you considering lump-sum benefits for hospital stays, surgery or other health issues? If yes, then limited medical or severe illness coverage can help save money. If you are not convinced to trust an insurance company, you can always handle the unexpected expenses using your savings, right?
What’s your definition of an affordable insurance plan that is unique and caters to your needs. Hate to break the ice, but what looks cheap based on monthly premiums could end up costing more out of pocket expenses. Consider the whole picture. What can you afford to spend on your healthcare? You must consider your premiums, co-insurance, prescriptions, over the counter drugs, services not covered by insurance and other expense. If needed, also consider your vision and dental coverage.
Collect and Compare Quotes
Consider both supplemental coverage and short-term medical plans. Online insurance quotes don’t commit you to a plan, and lets you make an informed decision. So, collect a few quotes, and make a list. Compare both quotes and plans. Once you have made a list, narrow down your options. Consider the premium, coinsurance, drug coverage, co-pays, deductibles and out-of-pocket expenses. Run the numbers according to the expected use of benefits and ensure the plan will work with your budget and needs.
Plan Network Providers
Take a closer look at your options. Do you need an in-network provider, or will you choose anyone? If you need in-network care, then check the plan’s provider list. It will ensure you have access to your doctor, specialist, institutes and hospital. Yes, you won’t have to visit someone you don’t like. However, some plans work with a national provider network and can offer a gigantic benefit.
Relatient is passionate about assisting healthcare organizations with patient-centered engagement.
By helping organizations automate patient-centered outreach and messaging, Relatient helps practices, hospitals and health systems facilitate more compliant, and ultimately healthier, patient populations.
Our co-founder and CTO Kevin Montgomery began tinkering with an email and text appointment reminder service for a local medical practice during a family health crisis to keep his mind busy. The first software was finished late one night at a hospital bedside, but it wasn’t until two years later that Relatient was officially formed. The core idea of automating patient engagement through consumer-like technology tools hasn’t changed. Since then Relatient has expanded on that simple idea and now automates text, email, and voice to improve administrative, billing and clinical aspects of medical practices and hospitals.
In late 2017, we announced the appointment of Michele Perry as CEO. In her new role, Michele is helping Relatient achieve its next phase of growth and realize our company’s vision to bridge the communication gap between patients and providers. Earlier in 2017, Michele joined Relatient’s board of directors, concurrently with an investment from Elsewhere Partners, where she serves as an operating advisor.
Since joining, Michele has added fuel to Relatient’s marketing and sales teams, including the recent addition of a SVP of sales and business development in order to advance our direct sales strategy.
First, we believe that practice and office managers are the unsung heroes of healthcare. Unfortunately, despite the rise of technology, ambulatory office personnel have workflows that are still largely manual and inefficient. For example, most practices have to manually go through payments collected throughout the day and post them to the system so that the doctor gets paid. This process usually happens after office close every day. Many practices also still mail patient reminder postcards via the postal service – licking stamps and all. We aim to alleviate and empower these heroes with modern patient engagement software.
Second, patients are consumers. They’re also becoming the new payer. Their behavioral expectations and financial power is driving physician practices to modernize. According to Black Book’s 2017 Revenue Cycle Management Report, consumers are facing a 29.4 percent increase in deductible and out-of-pocket costs. Moreover, 71 percent of today’s patients say mobile pay and billing alerts improve their healthcare experience, citing the billing process as their No. 2 customer satisfaction metric, just behind patient care. Relatient’s solutions help patients get to the doctor on time, check-in with ease, and pay their bills with consumer-like convenience.
Who are your competitors?
We bump up against a variety of patient communications solutions in the market, like Televox and Solutionreach, that offer singular patient reminder or messaging solutions. Other patient engagement companies focus on hospitals and health systems, but at Relatient, we specialize in ambulatory practices with five or more physicians.
Decreasing inpatient admission volumes, shifts in the re-imbursement mix from higher-margin commercial payers to lower-margin public payers, and pressures resulting from value-based care have been solid trends during the past several years. Thus, it was not surprising that a Moody’s Investors Service report released in August portrayed the current condition of finances for not-for-profit hospitals as troubling.
According to Moody’s, the median annual expense growth rate slowed from 7.1 percent in 2016 to 5.7 percent in 2017 because of hospitals’ continued control of labor and supply costs. But annual revenue growth fell faster, from 6.1 percent in 2016 to 4.6 percent in 2017, the second straight year that expense growth exceeded revenue growth, a trend that is expected to continue through 2019. Moody’s concluded that not-for-profit hospitals are on an “unsustainable path.”
Consequently, median operating margins dropped to an all-time low of 1.6 percent in 2017. More than 28 percent of hospitals posted operating losses last year, up from 16.5 percent in 2016. Of course, operating losses cannot be sustained forever. If they are sustained for multiple years, closure of the hospital frequently results. Earlier this year, Morgan Stanley concluded that 18 percent of U.S. hospitals are at risk of closure or are weak financially, with approximately 8 percent of hospitals (roughly 450 facilities) presently at risk of closing. To put that figure in perspective, during the past five years, only 2.5 percent (150 hospitals) have closed. Also, Morgan Stanley found that 10 percent of hospitals suffer from weak finances.
Various factors account for not-for-profit hospitals’ financial difficulties.
Because the vast majority of net patient revenue came from fee-for-service based payment models—such as DRG payment, fee schedule, percentage of the chargemaster, or list price—overall reduced payment rates adversely impacted revenue in 2017. To be clear, nominal payment rates did not decline—e.g., Medicare’s Inpatient Prospective Payment System and Outpatient Prospective Payment System both incorporated nominal year-to-year increases in 2017—but the revenue mix for hospitals did shift from higher-margin commercial payers to lower-margin public payers. Median Medicare and Medicaid payments as a percentage of gross revenue rose to 45.6 percent and 15.5 percent, respectively, in 2017. Furthermore, continuing a five-year trend, public payers’ share of hospital revenue is projected to increase for the foreseeable future, as more of the baby boomers—an obviously large demographic group—reach retirement age and an increasing number of them incur the sizable costs of the last year of life.
In addition, hospital finances were adversely impacted by the continued shift from inpatient to outpatient care, a trend driven by greater competition from ambulatory facilities, such as physician offices and ambulatory surgery centers. Moody’s reported that median outpatient growth rates exceeded inpatient growth rates for the fifth straight year. In her July 25 address to the Commonwealth Club, Seema Verma, administrator of the Centers for Medicare & Medicaid Services, supported the inpatient-to-outpatient shift, stating that Medicare is seeking to avoid “downstream” expenses, such as emergency department (ED) visits and hospital admissions.
Faced with these financial challenges, not-for-profit hospitals have pursued a number of approaches.
Most commonly, they have tried to improve their management of labor and supply costs. However, this strategy—while certainly logical—may be reaching a point of diminishing returns. Lyndean Brick, president and CEO of the Advis Group, a healthcare consulting firm, has concluded: “This is no longer solely about expense reduction. If not-for-profits just focus on that, they will be out of business in the next few years” (Modern Healthcare, Aug. 29, 2018).
Another strategic response has been consolidation—in which small hospitals join a larger health system—to gain more leverage with payers, to accomplish greater economies of scale, to get access to lower-cost capital, and to enhance access to talent.
By Leslie Sanchez, clinical educator, Children’s Medical Center in Dallas, Texas.
Active shooter training was initially seen as cumbersome and just “more training” to complete in our emergency department. However, after staff received the active shooter education which included statistics, active shooter profiles, videos of active shooters in action, and recorded interviews with victims and survivors from active shooter events, it made our staff realize the potential of it happening here in our facility.
Staff immediately recognized several ways that a shooter could not only enter the facility undetected, but could easily get access to various parts of the hospital with little to no effort. The second part of the active shooter training involved a functional exercise in the form of a simulation with various patient scenarios, actors and patients that would typically present to the emergency department. After the simulation, staff realized how difficult it is to not only walk away from your patients, but also from your peers, who quickly become your work family over the course of months and years and are the people you work with daily to save lives.
Many staff members voiced their inner turmoil of having to contemplate “RUN, HIDE, FIGHT” concepts and the idea of not taking their peers or patients with them when escaping danger. Staff were also surprised how they reacted when confronted with a hostile actor who held them at gunpoint or with a knife in hand. Some staff did not know how to react and they either stated they froze, decided to run away or grabbed items to fight the assailant, or did their best to hide in an area and barricaded doors with equipment and bed stretchers.
They also, at times, did not know what to say to the parents or patients in the room and had a hard time being direct when asking them not to cry or yell for help because of the absolute need to remain quiet, turn off the lights and to hold the door with force in case the assailant was nearby.
Each scenario played out differently and it amazed me how quick staff reacted to the aggressive actor with a gun or knife. There were times staff watched and waited for the active shooter to present themselves, while other times staff didn’t even notice that the shooter was “shooting people” in the room next door to them. Some staff thought we had simulated gun shots and swear they heard gun shots, which were never simulated. After the simulation, staff continued to share concerns about their safety in the ER and how they could be more proactive in their own safety by being vigilant about people roaming our hospital without proper identification.
They also continued to escalate and voice concerns to our leadership team about additional safety measure they believe should occur at the front entrance and ambulance bay when patients are brought into our department. Other staff talked about their heightened overall awareness in public areas after our training and how they now pay attention to their exits, who is around them and any behavior that is out of character.
Join Electronic Health Reporter partner Goliath Technologies on Tuesday, October 16th at 12:30 p.m. ET/9:30 a.m. PT.
During the live seminar you’ll gain the opportunity to learn more about how healthcare organizations like Monroe Healthcare, of Wisconsin, and Catholic Health Initiatives proactively use Goliath Technologies’ new Epic Module to anticipate, troubleshoot and prevent end user experience issues before Epic and Citrix users are impacted.
During the presentation, attendees will learn:
How to preemptively find end user experience issues before end users are impacted
How to achieve end-to-end visibility for troubleshooting and remediation
How to leverage Epic System Pulse metrics, Citrix or VMware Horizon performance metrics, and End User Experience metrics from one powerful view.
Goliath Performance Monitor is an approved application in the Epic AppOrchard.
When used with Epic, the Goliath Performance Monitor provides end-to-end correlation between the key metrics System Pulse provides, the underlying Citrix or VMware infrastructure, and user experience.
Goliath Performance Monitor works with Epic to distill the Response Time Tracking (RTT) value to its component parts, such as database time, network time, system time and more, and correlates those metrics to user experience performance. As a result, Goliath can provide resource availability and performance of each of the stages and support components to better enable administrators to understand how consumption and capacity affect performance. The end-to-end view that Goliath provides, combined with the data already available from System Pulse, allows corrective action before users are impacted – whether inside Epic or in the associated systems and infrastructure.
The Goliath performance monitoring and troubleshooting suite of tools provide everything hospitals and health systems need to ensure that the mission critical applications and systems needed by healthcare professionals to perform their life-saving work are available on a consistent basis.
Automatically confirm that EHR applications and IT infrastructure are available, and if they are not, use embedded intelligence and automation to alert IT so they can fix the issue before physicians and health care workers are impacted.
Anticipate, troubleshoot, and prevent end user experience issues where most users experience issues: logon initiation, logon processing, and system performance.
Enable IT pros to quickly remediate problems and isolate root cause to reduce professional pain.
Have broad and deep visibility to issues across multiple platforms, regardless of which IT infrastructure and applications are being used and where end users are located.
Provide objective evidence through historical reports and trending analysis to allow permanent fix actions to be implemented to prevent issues in the future.
DocuTAP crafts on-demand healthcare software and services that make over a thousand urgent care clinics run efficiently. We design a tablet-based EHR and PM, offer RCM services, and refine patient workflow.
A better urgent care experience.
In May of 2000, DocuTAP’s founders realized that wireless devices would play an increasingly important role in the delivery of healthcare. From that day, DocuTAP software was designed for use on handheld wireless devices. Founding CEO, Eric McDonald dreamed up the idea behind DocuTAP in his basement back in 1999. Eric spent his time consulting with physicians. In 2000, Eric officially started DocuTAP as a company with the help of angel investors. Today, he leads client relations and provides company direction and vision for technology and product design while being viewed as a thought leader in the urgent care industry.
DocuTAP works with urgent care clinics to provide a range of solutions and services including electronic health records, practice management, patient engagement solutions, analytics, billing services and consulting. As the healthcare industry continues to adopt on-demand models to serve the evolving healthcare consumer, DocuTAP provides the necessities for facilities to deliver efficient, affordable and good quality care.
The healthcare industry is changing. Patients are becoming consumers, and the healthcare consumer wants access to quick and convenient care- without booking out months in advance to still wait in multiple waiting rooms. DocuTAP serves urgent care clinics, however increasingly other healthcare verticals such as pediatrics are adopting on-demand business models increasing the different markets that are in search for the tools and solutions DocuTAP provides. As with every other industry, healthcare must now market themselves to the healthcare consumer, to not only attract visitors but keep them coming back. By keeping patients out of the waiting room with online scheduling and monitoring, allowing physicians to finish a chart completely in under two minutes, and optimizing the work flow of the front desk, DocuTAP gives urgent care clinics the resources to market all of these capabilities to consumers and deliver on these promises each and every time.
Who are your competitors?
DocuTAP has competitors that offer some of the services and solutions they offer, but not in the end-to-end capacity that DocuTAP does. Given DocuTAP’s all-encompassing service and solution offering, DocuTAP considers a few companies who offer similar services competitors.
How does your company differentiate itself from the competition and what differentiates DocuTAP?
DocuTAP’s key differentiator is they are not just a software provider, they are an end-to-end business partner. Each customer who works with DocuTAP relies on them for software, consulting, strategic advice, technical support, and expert insights. Whatever a customer needs, they are able to go to DocuTAP for, something competitors are not offering.
DocuTAP has a deep and extensive log of valuable data, available to visualize and pull out useful trends and findings that give them an edge in the market.
Ever increasing computational power, advances in artificial intelligence, and the lower of the cost computation (because of cloud computing service, such as Azure and Amazon Web Services) has enabled healthcare systems – often laggards in quality improvement and technology adoption – to rapidly implement analytics systems. Such systems enable enterprises to analyze and model their processes, engage in meaningful quality and process improvement activities, and prepare to succeed in value and risk-based payment models.
Hewlett Packard Enterprises recently published a piece that delineated some of the benefits that enterprises can gain from analytics (specifically the predictive form):
Gauging operating room (OR) demand
Better manage supply chains
Intervene with care pathways prior to adverse events occurring.
Enterprises with existing, legacy analytics systems – for example those that mainly work with claims-based data or lack predicative or real-time capabilities can likewise obtain the above efficiencies. A modern data warehouse must be flexible, SQL-enabled, cloud-based, and highly secure. Snowflake Computing’s cloud-based infrastructure is an example of one such system which can be easily scaled as it is offered to clients with usage-based pricing. A data warehouse alone, however, is not sufficient for an enterprise. Tools must be provided to prep, transform, and perform analysis on the data. Alteryx Designer, one such tool, allows analysts to prep and blend data from heterogenous sources – e.g., CSVs, databases, Excel files — in an efficient and reproducible manner, and, more importantly, it includes spatial and predictive analytics. This enables organizations to move from retrospective and barely actionable data to immediately actionable real-time predictive analytics.
Get leadership buy-in – Many people naturally resist change. Ensuring that leadership across the enterprise is committed to the change will enable a coherent messaging to be addressed to all stakeholders. There are many strategies to achieve leadership buy-in. A notable one, the ADKAR model is described here.
Choosing an effective partner – Especially for mission-critical or strategically sensitive projects, external help is critical. Talented consultants can augment staff skill shortages and bring critical experience (and lessons learned from other projects).
Be there and integrate training creatively – Project leaders should spend time onsite at the various locations where work occurs to ensure proper training and data conversion. During training, don’t just rely on classroom style training; rather, sit down with users and work through actual day-to-day problems. Consider also setting up open office hours where super users or hired technology partners can guide users through specific day-to-day processes.
Train Superusers – A successful analytics systems empowers users – especially key super users – to use the application on their own and not to depend on report requests to an analytics department.
Be honest and use humor – The latter can assist in convincing people to give a new system a chance. Honestly builds rapport within an organization especially during a challenging project. If one is converting from a legacy analytics system to a new one, it is important to empathize with users. They have been doing their work on the old system for years; their apprehension is natural.
Make friends with problem persons but acknowledge that not everyone will accept change – Try working alongside so-called problem persons. It will help you as a project leader to determine why they are negative and show that you are empathetic to their concerns and are personally invested in their successful transition. Note, however, there will be a minority of users that will refuse to accept the change. For the project to be successful, it may be necessary to move on and hope that they come around once the project is successful.
Be a warrior and ignore borders – Sometimes it is important to put a stop to delaying tactics such as an abundance of meetings and just move forward. Additionally, such assertiveness must be used to modify the scope of the project if it is necessary to keep the organization functioning.
Healthcare delivery is being transformed as we speak, from technological breakthroughs and regulatory change to changing patient demographics and consumer expectations. As the healthcare landscape evolves, forward-looking healthcare providers are seeing their real estate in a new light. It’s time for healthcare providers to consider new approaches to real estate and facilities as a way to improve efficiency and patient outcomes.
Following are four ways hospitals and health systems can stay ahead of the curve.
Leverage the M&A boom to improve facilities performance and value. While 2017 seemed to be the year of hospital M&A, JLL analysis points to an even higher volume of M&A in 2018. Cost containment is often a key motivator for initiating M&As. In the aftermath of consolidation, many health systems are now sitting on large portfolios of underutilized real estate that represent a major source of value and capital investment. A data-driven analysis can help identify opportunities to drive more value from each facility and put each to its highest and best use.
Unlock operational efficiencies with a centralized approach. As health systems expand their real estate portfolios with diverse outpatient facilities, centralized facility management and maintenance may be the most efficient way to manage their growing footprints. Partnering with a third-party facility management service provider is a common path to centralization, although it is critical to partner with a firm that understands the nuances of the healthcare environment.
Centralized control of facilities data and analytics provides a complete picture of how different facilities are performing, so the facilities team can make accurate capital plans based on data rather than informed guestimates. Also, today’s facility management technology supports preventive maintenance and can even generate automated alerts if a building system is malfunctioning or approaching a complete breakdown. In addition to improving efficiency, a facilities management partnership can help reduce compliance risks and improve patient and staff satisfaction.
Embrace new definitions of what it means to be a health system—and how that plays out on the map. Though hospitals remain a critical focus, traditional networks may soon be rendered obsolete as industry leaders find that new opportunity lies outside the hospital campus. From medical office buildings to healthcare-anchored retail centers, tailored care settings can improve the patient experience and increase patient loyalty—and boost the hospital balance sheet.
However, managing a complex network of medical facilities requires a thoughtful strategy informed by location analysis. Thinking differently can reap big rewards, but it’s important for executives to carefully weigh the risks and benefits of paying a little more to be closer to where patients already spend time.