How Healthcare Providers Can Avoid Being at a Disadvantage When Negotiating Risk Contracts

Risk stratification is an effective short-term strategy for providers seeking to negotiate risk contracts from a position of strength.

To gain leverage in risk-based contracting, healthcare finance leaders require a means to identify the true cost of care at the patient level based on actual care services and supplies delivered. But most organizations are years away from possessing such a capability, so their finance leaders require an interim solution to help them gain an advantage in their contract negotiations with payers.

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Managing Today’s Ambulatory Revenue Cycle

There are many mechanisms healthcare organizations can use to accelerate their financial recovery efforts post-COVID-19. 

When examining these mechanisms, financial leaders' questions often boil down to two essential concerns: How effective is it? And how long will it take for us to see results?

The revenue cycle lands at the top of the heap when it comes to quick but highly effective ways to accelerate revenue. It also plays a critical role in improving the patient experience and health of populations while reducing the cost of care. 

By improving revenue cycle efficiencies, healthcare financial leaders can gain a vital "quick win" in their financial recovery timeline.

I recently taught a 2-day HFMA seminar on Revenue Cycle Essentials and KPIs (key performance indicators). Here, I’ll summarize the challenges revenue cycle leaders are experiencing today, as well as key factors for success. 

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Your Healthcare Team Is the Key to Value-Based Care

Value-based care (VCB) requires a keen focus on the Triple Aim: achieving better quality and patient outcomes while bending the cost curve. This is not done in silos; VBC is a team sport that requires collaboration across providers in all settings of care, from the doctor’s office in the ambulatory setting to the hospital to the post-acute setting, including effective transitions from one setting to the next. Coordinating care across the continuum and across all settings is key.

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The 4 Pillars of Clinical Service Line Success: Part 4 - Analytics and Innovation

Hospitals and health systems across the country are reexamining their clinical service line strategies and operations in response to the shift from volume to value. In addition to population-based and episode-based payment reforms initiated by public and private payers, providers are challenged by mergers and acquisitions, clinical integration, consumerism and price transparency. Strengthening clinical service line strategies and capabilities are critical approaches to addressing these many challenges.

This post is the fourth in a four-part series where we introduce the pillars of success for clinical service lines: Governance and Leadership, Clinical Integration, Clinical Transformation, and Analytics and Innovation.

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The 4 Pillars of Clinical Service Line Success: Part 3 - Clinical Transformation

Hospitals and health systems across the country are reexamining their clinical service line strategies and operations in response to the shift from volume to value. In addition to population-based and episode-based payment reforms initiated by public and private payers, providers are challenged by mergers and acquisitions, clinical integration, consumerism and price transparency. Strengthening clinical service line strategies and capabilities are critical approaches to addressing these many challenges.

This post is the third in a four-part series where we introduce the pillars of success for clinical service lines: Governance and Leadership, Clinical Integration, Clinical Transformation, and Analytics and Innovation.

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The 4 Pillars of Clinical Service Line Success: Part 2 - Clinical Integration

Hospitals and health systems across the country are reexamining their clinical service line strategies and operations in response to the shift from volume to value. In addition to population-based and episode-based payment reforms initiated by public and private payers, providers are challenged by mergers and acquisitions, clinical integration, consumerism and price transparency. Strengthening clinical service line strategies and capabilities are critical approaches to addressing these many challenges.

This post is the second in a four-part series where we introduce the pillars of success for clinical service lines: Governance and Leadership, Clinical Integration, Clinical Transformation, and Analytics and Innovation.

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The 4 Pillars of Clinical Service Line Success: Part 1 - Governance and Leadership

Hospitals and health systems across the country are reexamining their clinical service line strategies and operations in response to the shift from volume to value. In addition to population-based and episode-based payment reforms initiated by public and private payers, providers are challenged by mergers and acquisitions, clinical integration, consumerism and price transparency. Strengthening clinical service line strategies and capabilities are critical approaches to addressing these many challenges.

This post is the first in a four-part series where we introduce the pillars of success for clinical service lines: Governance and Leadership, Clinical Integration, Clinical Transformation, and Analytics and Innovation.

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Blueprint for Taking on Risk in Healthcare

Facing growing pressure from insurers to assume more financial risk, healthcare providers are exploring ways to better manage cost and utilization through risk-based contracts.

Unfortunately, most organizations tend to focus more on the contract itself and fail to give adequate attention to planning out what they will do once the agreement is signed.

Effective contract negotiation and execution depend on the same set of capabilities. To succeed in risk-based contracting, providers need to build an infrastructure that supports every dimension of risk management—from risk modeling and contract design to population health strategy.

Here are four elements that will be instrumental to building this infrastructure.

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Service Line Structures Are the Next Step in Improving Quality and Cost

Now is the time for healthcare organizations to take the next step in elevating quality while reducing the cost of care. This will involve creating service line structures designed to function in the developing environment of value-based payments. In contrast, the original purpose for most health systems was to more tightly tie specialists to each other and to health system programs, not necessarily to improve the patient experience and outcomes.

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Building a Performance-Based Value Model to Drive Population Health Strategies

On Sept. 20, I had the honor of presenting to a standing-room-only crowd at Becker’s Hospital Review 4th Annual Health IT + Revenue Cycle Conference in Chicago. I spoke about how clinical and finance leaders need a data-driven value model to plan the scale and pace of investments into a population health strategy and to move confidently into value-based contracting.

Most healthcare leaders understand the importance of population health and building the most optimal strategy to position their organizations for success in value-based care. Building the tools to manage patient populations is key to improving outcomes while bending the cost curve in American healthcare.

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