May 17, 2020

With rising costs, US hospitals have overlooked how to gain over $20 million in revenue capture

Health Insurance
healthcare
healthcare services
Management
Catherine Sturman
3 min
With the aim to improve the performance of health organisations, the Advisory Board Company has looked at how hospitals can provide increased value and...

With the aim to improve the performance of health organisations, the Advisory Board Company has looked at how hospitals can provide increased value and ensure sufficient cost savings.

A recent analysis has shown how this focus on revenue cycle performance within an average sized 350 bed hospital has dropped significantly across a number of key areas within US healthcare, whilst costs to achieve quality, patient-centered care have risen significantly.

Delving into the costs associated with revenue cycle management, the company has analysed how hospitals could gain up to $22 million in revenue.

James Green, National Partner, Consulting at Advisory Board said, "From top-performing revenue cycle organisations to the bottom quartile, critical benchmarks have been either stagnant or steadily sliding since 2011 and need a strategic overhaul." 

"Even if payments from government payers—Medicare, Medicaid and insurance exchanges—remain constant in 2017, four other forces present strategic challenges to defending margins. These are:

  • Increased patient consumerism driven by higher financial obligations
  • Aggressive commercial denials and more complex payer contracts
  • Physician engagement on documentation given demands on the acute care and medical group enterprises
  • Poorly executed integrations that waste potential economies of scale."

However, with the health industry currently under transformation globally, alongside President Trump’s plan to disrupt the health system by replacing the Affordable Care Act, hospitals are under considerable strain to deliver.

The study has shown that median performing organisations have stagnated on net days in accounts receivable, with the overall average cost to collect worsened by 70 basis points of net patient revenue from 2011 to 2015 This therefore amounts to millions of dollars of lost revenue.  

Jim Lazarus, National Partner, Technology at Advisory Board added: "By taking a more strategic approach toward legislated payment reform—institutions could make that quartile jump for each of those four metrics and improve by up to 6.4 percent of margin."

The Advisory Board also highlights four forces which are challenging current processes:

  • Commercial Payers are scrutinising an increased number of claims: commercial contracts no longer provide the growing margins that used to offset lower Medicare and Medicaid reimbursement for many hospitals. Hospitals are losing, on average, five percentage points of their margin to underpayments, denials, and suboptimal contract negotiations, creating an ongoing impact in performance.
  • Patient obligations are neutralising benefits of coverage gains: While insurance coverage has increased, so has bad debt, with no sign of slowing down, putting increased responsibility on patients and increased risk and inflexibility.

To build more enduring relationships with patients and improve collections, the study shows that hospitals and health systems need to improve the patient financial experience. This is with a foundation built on clear search capabilities for price estimates, better access for scheduling and payment, a positive care encounter, and each point of financial contact contributing to the construction of a long-standing relationship.

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May 24, 2021

Schneider Electric's intelligent patient room: need to know

smarthospital
Automation
IoT
connectedhealth
2 min
We take a look at Schneider Electric's new smart patient room. 

Schneider Electric has launched a virtual showcase that features its new "intelligent patient room". What is it exactly? 

Who: Schneider Electric is a multinational that develops energy and automation solutions for many different industries - including hospitality, education, defence, and healthcare. Founded in 1836, today it is a Fortune 500 company, and it currently provides technology to 40% of hospitals around the world, among them Penn Medicine, one of the top hospitals in the US where Schneider's EcoStruxure for Healthcare is deployed, an IoT solution. 

What: Schneider has launched its Innovation Experience Live Healthcare Lab, an immersive experience that takes visitors through a demonstration of a hospital, including the doctor’s office, the operating room, and the intelligent patient room. 

The room features a digital patient footwall - a touchscreen that creates a single reference point for patients, families and healthcare providers, by incorporating care information, entertainment and environmental controls all in one place.  A separate digital patient door display has important information for healthcare staff. 

All Schneider's equipment is low-voltage, and integrated so that the patient room, clinical needs and IT are all seamlessly connected, what Schneider calls a digital “system of systems.”

Why:  Mike Sanders, Customer Projects & Services in Healthcare Innovation at Schneider Electric, explains: “The hospital of the future will need to put the patient experience at the forefront, using innovative and connected systems to provide superior in-hospital care experiences.” 

“With the shift to remote work and business brought forth by the pandemic, we knew that we needed to invest in a new virtual experience that showcases our vision for a truly integrated healthcare experience. We believe our intelligent patient room is the solution that our healthcare partners and customers have been looking for, and we’re excited to offer a way for them to experience it no matter where they are in the world.”

Where: The virtual experience was modelled after the new innovations installed at Penn Medicine in Philadelphia, the first real-world installation of Schneider Electric’s fully integrated intelligent patient room technology. It is currently being hosted at the company’s St. Louis Innovation Hub and Innovation Executive Briefing Center (IEBC) facility.  

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