Tag: MedeAnalytics

COVID-19 and The Financial Storm Ahead For Providers

By Pete Bekas, director of product consulting, MedeAnalytics.

Pete Bekas

COVID-19 has taken a significant toll on our nation’s health system. In hard-hit cities like New York and Chicago, we watched makeshift hospitals open, military hospital ships deployed to support overflow patients, and operating rooms turned into intensive care unit rooms.

While providers focus on treating coronavirus patients, the lack of other services, such as outpatient surgeries, radiology services and other procedures, is resulting in extreme revenue loss.

Across the country, healthcare organizations are seeing 40% to 80% declines in monthly charges with some of the most profitable services lines only seeing 20% of their normal monthly volumes during the pandemic.

As we live with social distancing and providers continue to follow guidelines from professional associations to postpone and cancel non-urgent cases, healthcare organizations are just now starting to see the financial impact that COVID-19 is having on their organizations. We know that it takes payers approximately 35 days to process and pay claims. This processing time means organizations are about to enter financially-troubling times.

To add to the financial stress of diminishing volume of elective cases, organizations are seeing clinical staff contract the coronavirus or need self-quarantine because of symptoms. This requires healthy staff to put in longer hours resulting in overtime, which adds to the cost to care for those who need it the most.

Pay cuts, furloughs and layoffs have caused more even more stress within the healthcare sector. These actions have been taken in departments that have seen their patient volumes cut in half. Many physicians have seen cuts to their paychecks as organizations take drastic measures to conserve cash as they look to weather to the financial storm that is only weeks away.

Federal Government Relief

In mid-April 2020, the U.S. Department of Health and Human Services started depositing money from the CARES Act. Approximately $100 billion in relief funds will be sent to hospitals and other healthcare providers. The initial $30 billion was distributed based on the Medicare fee-for-service payments to providers during 2019; approximately $62 was given to providers per $1,000 paid in 2019. (Organizations where Medicare is not a large payer may have received little or no financial help in the initial round of relief putting them in a more difficult situation.) Although these funds come at a much-needed time, the question is how long the money will help hospitals and providers, given we are nowhere close to being back to normal patient volumes.

Nevertheless, additional relief is said to be on its way. (CMS said it would offer advanced payments loans to providers; this has since been put on hold.) Recent legislation is looking to add additional relief funds for our fragile health system. The damage, unfortunately, has already been done and it will take quite a while to recover.

Getting Back to Normal

The individuals who most often use profitable healthcare services, such as outpatient surgery and radiology are believed to be at the highest risk of contracting the coronavirus. As states begin to remove stay-at-home orders and we return to the new normal, how long will patients continue to defer medical services because of the fear of being exposed to the coronavirus?

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CMS Updates Payment For Certain COVID-19 Lab Tests

By Brenda Turner, director of product consulting, MedeAnalytics.

Brenda Turner

The COVID-19 landscape as it relates to testing is frequently changing as CMS made wholesale changes and smaller adjustments to payment schedules.

CMS announced Medicare will nearly double payment for certain lab tests that use high-throughput technologies to rapidly diagnose large numbers of 2019 Novel Coronavirus (COVID-19) cases.

Medicare will pay the higher payment of $100 for COVID-19 clinical diagnostic lab tests making use of high-throughput technologies developed by the private sector that allows for increased testing capacity, faster results, and more effective means of combating the spread of the virus. High-throughput lab tests can process more than 200 specimens a day using highly sophisticated equipment requiring specially-trained technicians and more time-intensive processes to ensure quality. Medicare will pay laboratories for the tests at $100 per test effective April 14, 2020, through the duration of the COVID-19 national emergency.

CMS and the US Departments of Labor and Treasury issued guidance to ensure Americans with private health insurance have coverage of COVID-19 diagnostic testing and certain other related services, including antibody testing, at no cost.

Specifically, the requirement for group health plans, and group and individual health insurance is to cover both diagnostic testing, and certain related items and services provided during a medical visit with no cost-sharing. This includes urgent care visits, emergency department visits, and in-person or telehealth visits to the doctor’s office that result in an order for or administration of a COVID-19 test.

Covered tests include all FDA-authorized COVID-19 diagnostic tests, COVID-19 diagnostic tests that developers request authorization for on an emergency basis, and COVID-19 diagnostic tests developed in and authorized by states. It also ensures that COVID-19 antibody testing also will be covered.

The initial pricing for the new codes U0001 and U0002 for the Centers for Disease Control and Prevention (CDC) test will be approximately $36 and non-CDC tests will initially be approximately $51. These prices may vary slightly depending on the local Medicare Administrative Contractor (MAC).

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3 Steps Any Healthcare Organization Can Take To Improve Enterprise Analytics

By Kristin Weir, vice president of product, MedeAnalytics.

Kristin Weir

When it comes down to the most basic purpose of why organizations use analytics, it’s simple: they want to uncover insights that help them take the next best step or make the best decision. These healthcare organizations often need, however, all the components of the enterprise analytics story to be able to do that.

Unfortunately, few organizations today have that capability because of the fragmented nature of the healthcare analytics industry. There are hundreds of vendors claiming to do healthcare analytics in the market. Many of those vendors offer wonderful point solutions, whether it be for population health, revenue cycle management, cost and operations, or employer reporting. But this partitioning of analytics has led to organizations purchasing upwards of 20 or more different solutions.

Each niche solution is like a chapter in the entire book of the enterprise analytics story that the organization is telling. The problem in that scenario is that each chapter is from 20 different books and they don’t tell a comprehensive story. In analytics terms, those chapters are not interoperable.

Organizations with multiple niche solutions are faced with trying to stitch together chapters from different books to create their stories. One book is a mystery, the next a romance, the next is sci-fi and so forth. By the time a single story is created, the narrative is confusing, incomplete and utterly incomprehensible by end-users.

Reading chapters from the same book, however, helps healthcare tell a comprehensive, single, trustworthy story. They can weave together insights from different chapters to arrive at the conclusion.

What does having one book mean from an enterprise analytics perspective? With enterprise analytics, you are extending analytics across the healthcare ecosystem. You’ll be able to accelerate goals and solve business challenges, improve outcomes for providers, strengthen cost and quality for health plans, and create a single source of truth on one platform with interoperable solutions.

Why do healthcare organizations use so many different vendors? There are a variety of reasons, but these are the top two:

  1. They may have purchased at the department level versus the enterprise level, which often puts the focus of the procurement only on the needs of the department.
  2. As healthcare has evolved, new requirements for enterprise analytics have emerged. Existing vendors may have done a, b, and c well, but now there’s a need for x, y and z; and that is something the original vendor can’t solve for.

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Health IT Trends For 2020: Some Thoughts From Leaders

New Year'S Day, New Year'S Eve, Clock

Kristin Simonini, vice president of product, Applause

Healthcare has long been looked at as a laggard when it comes to adopting digital services. Part of that is due to the stringent regulations of the industry and the sensitivity surrounding personally identifiable information. Part of the blame, however, falls on healthcare providers themselves. As more and more providers in the industry start to embrace digital innovation, a number of key trends emerged over the past decade including:

Healthcare’s focus on patient experience means bringing a critical eye to current digital experiences. Ease-of-use and inclusivity must be considered in order to ensure high-quality digital experiences across all touchpoints, particularly on smartwatches, tablets, and smart speakers

In terms of predictions for 2020, we expect use of voice technology will continue to grow and will empower the healthcare industry in new ways, including supporting patients. The benefits that voice brings to healthcare can be seen in medical record transcriptions, chatbots sharing the work, sharing knowledge, voice-user interface, and connecting clinics to customers.

In addition, AI will continue to impact the healthcare industry in numerous ways. As healthcare embraces AI, it will also need to address issues of bias. All types of AI – from virtual assistants learning how different users ask for the same thing, to healthcare apps identifying potential health issues from uploaded photos – have been hampered by the same challenge: sourcing enough data to teach the machine how to interpret and respond, and then testing the output at scale to ensure the results are accurate and human-like when necessary. To mitigate bias concerns, healthcare will need to make AI more representative of patients

Scott Hampel, president, MedeAnalytics

Today, healthcare payers and providers are spending nearly $30 billion every year on analytics and using over 415 different vendors for their analytics needs. This is a tremendous waste of resources and time. We’ll see an accelerating trend toward converged analytics solutions that cross clinical, financial and operational boundaries to enterprise analytics solutions.

Enterprise analytics will dramatically increase the speed and efficacy of population health programs because when you have both fresh claims-based data and clinical analytics you can diagnosis, intervene and engage in care management programs far faster and with much greater confidence in the data and results. This is where healthcare will be moving in 2020.

Patrick Gauthier, director, AHP Healthcare Solutions

In the year ahead the health care sector is going to continue to see investment in Artificial Intelligence (AI) and Machine Learning. That dimension of innovation in hi-tech will continue to evolve and emerge and markets will slowly open and mature.

I believe health information exchange or HIE – once known to most of us as regional health information organizations or RHIOs – will be back in vogue. What began more than a decade ago went underground for a while but ACOs and other initiatives have resurrected HIE infrastructure and made it abundantly clear that HIE is vital to care coordination, outcomes and value-based reimbursement (VBR). All-provider clinical messaging, outcomes measure, quality assurance, transitions in care, cost and utilization management, and referral management absolutely must be supported by HIE infrastructure.

Biometrics will continue their spread and companies such as Apple and Google (for better or for worse) are making it clear they see the future and are investing accordingly.

Lastly, population health management platforms that enable functions like risk stratification will see tremendous growth.

Tim O’Malley, president and chief growth officer, EarlySense

Technology advancements over the past decade have enabled us to accurately track millions of physiological patient parameters in real time. As we head into 2020, the industry will continue to leverage the incredible power of AI-driven “smart data” and analytics to not only predict potential adverse patient events, but also prevent them.

Patient care will continue to become even more personalized and new standards for patient safety will emerge. Predictive analytics will be used across the continuum of care- from hospitals to skilled nursing facilities and homes- to support health staff and patients, improving clinical outcomes while also creating a potential for significant financial savings.

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Dog Sledding and ACOs: What Do Health IT Leaders Do When the Lead Dogs Fail?

Ken Perez

Guest post by Ken Perez, Director of Healthcare Policy and Senior Vice President of Marketing, MedeAnalytics, Inc.

Recently, Mitch Seavey, 53, became the oldest winner of the Iditarod, the most famous dog sledding race in the world. At a distance of 1,600 kilometers, the Iditarod constitutes a race of supreme endurance. In dog sledding, the dogs that are chosen to lead the sled are usually the smartest, as well as the fastest, and they are appropriately called lead dogs.

The lead dogs in the realm of Medicare ACOs are the 32 pioneer ACOs, the selection of which was announced in December 2011 with great fanfare and optimism. With the greater risks (and rewards) of the pioneer ACO Model, the pioneers were widely considered the best and the brightest, the organizations most likely to succeed as ACOs.

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The Sequester: Analysis of Its Impact on Healthcare

Thanks to Ken Perez, senior vice president of marketing and director of healthcare policy at MedeAnalytics, for forwarding me the following very concise, yet detailed information about the sequester and its impact on healthcare from a white paper he drafted on the subject.

For those of you wanting to know more about how the sequestration came to be and the purpose for the reduction in spending over the next 10 years, Perez and MedeAnalytics do a great job describing the reasoning for it and its potential impact to the healthcare community in “The Sequester: Analysis of Its Impact on Healthcare.”

Thanks, Ken, for offering us a nonpartisan view of the sequester. We appreciate the objectivity to what’s become a very subjective debate. If after reviewing the following information and you have any questions or comments, leave them in the comment section. If they are for Perez, I’ll make sure he gets them and can respond.

Background of the Sequester

The Budget Control Act of 2011 (BCA) was the compromise legislative solution that enabled the United States to get through the debt crisis of the summer of 2011. The act was passed by the House of Representatives on Aug. 1, 2011, by a vote of 269-161, and by the Senate on the following day by a vote of 74-26. The BCA was signed into law by President Barack Obama on Aug. 2, 2011 as Public Law 112-25.

The intent of the BCA was to rein in long-term federal spending and raise the debt ceiling. To those ends, it put in motion $917 billion in cuts to discretionary spending (excluding Medicare) over 10 years and raised the debt ceiling by $900 billion.

In addition, the BCA created a 12-member Joint Committee of Congress (also known as the “Super Committee”) to produce proposed legislation that would reduce the deficit by at least $1.5 trillion over 10 years.

The act mandated a sequestration process (or sequester) that would be triggered if the Joint Committee was unable to agree upon a proposal with at least $1.2 trillion in spending cuts. Ultimately, to no one’s surprise, the Joint Committee failed to reach an agreement, and the sequestration process was triggered. Per the sequester: 1) The President could request a debt limit increase of up to $1.2 trillion; and 2) across-the-board cuts equal to the debt limit increase would apply to both mandatory and discretionary programs, with total reductions split equally between defense and non-defense functions.

The across-the-board spending cuts would be implemented from FY 2013 through FY 2021, a period of nine years, and apply to both mandatory and discretionary programs. The cut to Medicare would be capped at two percent and limited to cuts to provider payments.

Exempt from the cuts were Medicaid, welfare programs (e.g., food stamps), and other low-income subsidies, as well as Social Security, veterans’ benefits, civilian and military retirement, and net interest payments.

What would be the annual reduction by function of the sequester? Per Table 1, starting with the total reduction of $1.2 trillion to be applied over the nine-year period, a specified 18 percent for debt service savings is deducted, and then the result is divided by nine to arrive at the annual reduction of $109.3 billion for each year for FY 2013 through FY 2021. In every year, the annual reduction is split evenly between defense and non-defense functions, resulting in a $54.7 billion reduction for each function.

The Impact on Medicare of the Original Sequester

According to a September 2012 report from the Office of Management and Budget (OMB), the sequester would pare Medicare in FY 2013 by $11.8 billion, with the following distribution of the cuts:

The American Taxpayer Relief Act of 2012

In early January 2013, Congress averted the so-called “fiscal cliff” by passing the American Taxpayer Relief Act of 2012, Public Law 112-240, which, among many things, pushed out the implementation of the sequester until March 1, 2013, reducing the total cut for FY 2013 by $24 billion or 22 percent to $85.3 billion.

The Enactment of the Revised Sequester and Its Impact on Healthcare

Through March 1, 2013, President Obama and congressional leaders were unable to reach an agreement to avert the automatic spending cuts of the revised sequester.

According to the Congressional Budget Office and per Table 2, for FY 2013, the total cut of $85.3 billion includes $42.7 billion in cuts to defense, $9.9 billion in cuts to Medicare, and $32.8 billion in cuts to other non-defense programs.

Medicare accounts for 12 percent of the total cut and 23 percent of the nondefense portion. How might the $9.9 billion in cuts to Medicare be allocated? In the absence of further guidance from the OMB, a reasonable approach would be to apply the same proportions as the aforementioned September 2012 OMB report. This would yield the allocation reflected in Table 3, with Medicare Parts A and B sustaining the lion’s share of the cuts.

Medicare Part A could be cut by $4.9 billion, which could include an estimated $3.1 billion cut to the Hospital Inpatient Prospective Payment System (IPPS). This cut to the IPPS would translate into an estimated $0.9 million reduction in Medicare reimbursement for the average hospital.

Medicare Part B could be cut by $4.4 billion, which could include an estimated $1.7 billion cut to physician payments and a $0.7 billion cut to the Hospital Outpatient Prospective Payment System (OPPS).

According to the rule for sequestration, reductions in Medicare will begin in the month after the sequestration order is issued, i.e., April 2013, thereby delaying some of the effect on outlays until the ensuing fiscal year. Thus, for the federal government’s FY 2013, which ends September 30, 2013, the following could be the actual cuts:

Conclusion

The sequester clearly affects healthcare providers in FY 2013 in a material way. Unless it is repealed by Congress, the BCA — with its annual $109.3 billion sequester cuts for each of the next eight years — will raise the specter of two-percent funding reductions for hospitals and physicians on a yearly basis.

Because of the significance of healthcare to the federal budget and the nation’s economy, the broader philosophical and fiscal debate between the two political parties on what is the best way to reduce the deficit and engender economic growth will continue to impact the reimbursement rate-setting process.

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