With the financial market meltdown, worldwide recession I say look for new mergers and closings in the hospital industry. Even though many are profitable, well at least slightly, that will go by the way side with investment income losses, higher numbers of uninsured, rising bad debt and lengthening delays in Medicaid payments from the states, the picture is bleak. Declining utilization and tighter reimbursement from managed care doesn’t help either. Oh yea, those pesky retail clinics won’t help either. I am surprised more hospitals don’t go that route, partner with their doctors and drive those babies out of their markets.
Insuring the 45 million and growing uninsured is not in the cards fore the foreseeable future, not till 2010 at the earliest. President-elect Obama has his hands full. First priority is fixing the financial system, second is the economy, and third is healthcare. Without the first two, the third never happens.
Hospitals are cutting back, but it is in marketing as always. CEOs never did understand the value of marketing and what it can do, but then why do we need to be customer focused? Part of that blame goes to marketers who are unable to prove value; focus on the fluff stuff; and not holding themselves accountable for a bottom-line result. Could be too many newsletters, ads touting services people don’t need or want and not positioning on a quality and service perspective.
Answer this…. if you can’t say in 25 words or less about how you are different from everyone else, then you are adrift in your marketplace and your key customers can’t either. But then your competitors are in the same boat and they just may be as clueless as you are. Define and differentiate before someone else does it for you...
The hospital industry is undifferentiated and it’s becoming a commodity. Focus on satisfaction- employee and patient. You won’t have satisfied patients without satisfied employees. More to follow latter on that one
By the way I am hearing some not so flattering reports about the quality of primary care in those retail clinic settings. Wrong diagnoses, medication errors and faulty in site quick tests make we wonder how soon before the government step in and regulates. More direct physician oversight, certification and training are needed to prevent someone from dying. Hasn’t happened yet but it will. It’s just a matter of time. If you have a good or bad story about the retail clinics post it up.
The company I work for is going through a major reengineering. Look for big and I mean big reductions at the coporate staff level first quarter 09. Lots of uncessary layers and they could really benefit from a dose of lean management. Probably means I will be out of a job. Oh well, here we go again, that will be the seventh time in eight years. I have the nack for finding those companies.
Been busy and P4P
10:39 AM
fast-ptich, P4P, Patient Satisfaction, Pay for Performance, Softball
Its been a long time since I posted. Much has been happening in healthcare, but frankly, family has been at the forefront of my life. My daughter plays fast-pitch travel softball, so know you know the rest of the story. Weekend tourney's, lots of practices and games. No national bids this year but it was a lot of fun. Try-outs last weekend for 12U, start again and she's playing fall ball. Left-hander, pitches and plays first base and outfield. Pretty good from Dad's point of view....
Now back to the issues....
P4P, Patient Satisfaction and my read on what you need to do Mr. Hospital CEO......
Attempts at payment system reform to stem rising healthcare costs by controlling access and utilization through various insurance programs and market based reforms- PPOs, HMOs, MSAs and HSAs to name a few, have meet with limited success. With projected healthcare spending to potentially exceed $4.1 trillion by 2016[1], Pay-for-Performance (P4P) represents a potential mechanism to reign in unsustainable healthcare spending growth.
Pay-for-Performance, commonly referred to as P4P, is a concept whereby hospitals, health systems, physicians and other medical providers are incentivized along agreed upon quality standards for specific procedures. In return, they receive increased reimbursement rates based on meeting defined quality standards of which patient satisfaction is one of the critical performance measures.
The short historical background of the P4P movement begins in[2]:
1991, the National Committee for Quality Assurance (NCQA) with the introduction of the Health Plan Employer Data and Information Set (HEDIS)
2001, the Institute of Medicine proposes that quality-based incentive payments to healthcare providers can improve quality
2002, the Center for Medicare and Medicaid Services (CMS) launches its pay-for-performance plan based on 10 quality measures, and in conjunction with the Agency for Healthcare Research and Quality (AHRQ), develops and introduces HCAHPS
2003, Medicare Prescription Drug, Improvement and Modernization Act of 2003, hospitals reporting quality data in 2004 receive enhanced payments in 2005
2003, CMS and Premier launch the Premier Hospital Quality Incentive Demonstration Project (HQID)
2004, employer-based groups entered the P4P debate with the concept of “Care-Focused Purchasing” using quality standards based on medical evidence
2005, the Joint Commission and the American Medical Association begin to more heavily weigh into the debate
Underlying all is the concept that patient satisfaction is a key value-based decision driver patients can use to make reasonable purchasing evaluations when seeking treatment, as well as positively affecting patient compliance and adherence. Organizations demonstrating the ability to consistently deliver high levels of satisfaction will improve their quality outcomes and be rewarded accordingly through higher reimbursements.
The Patient Satisfaction Imperative
Satisfied patients[3]:
Are more compliant with treatment regimens
Even if the medical outcome is not good, believes that he or she had a quality medical experience.
Recommend you to others
Return to you for care
Litigate less
Highly satisfied patients are a source of continued revenue, cost avoidance and positive community image. A culture of satisfaction is one of the major focuses of the institution. Lead by senior executives, satisfaction is measured, evaluated and defined as an organizational imperative[4]. In a P4P environment where a portion of the hospitals reimbursement is at risk by not achieving required quality standards, the institutionalization of patient satisfaction processes, measurements and departmental change capabilities targeting benchmark performance can result in additional revenue. This enhanced revenue possibility could potentially be the difference between growth, expansion and continued mission, or an uncertain future that hospital leadership has little ability to control.
Taking Advantage of Pay-for-Performance
Understand that P4P is a risk-taking proposition requiring dedicated resources, measurement capabilities and access to proven quality improvement techniques and systems. The hospital or health system that applies the following principles established through years of research and market success can take a step forward confidentially thriving in a P4P environment. Some of the key programmatic elements for a successful venture into P4P include:
Robust survey
Rigorous measurement and analysis
Willingness to focus on change
Access to current thought-leaders, case studies and white papers
Peer group comparisons and the ability to network
Gain-sharing with physicians, employees and vendors
Vendor risk sharing and support
Conclusion
Pay-for-Performance represents a significant opportunity in the age of data transparency to improve quality, reduce costs and improve outcomes. Leadership’s action supported by proven expertise can allow for the taking of calculated, defined risks necessary to capitalize on payments for achieving high levels of patient satisfaction. As consumer-directed health becomes more relevant and employers continue to shift the cost of care to employees, high levels of patient satisfaction will be one of the determinants of reimbursement, exclusive agreements, expansion and market share growth.
[1] John A. Poisal, Christopher Truffer, Shelia Smith, Andrea Sisko, Cathy Cowan, Sean Keehan, Bridget Dickensheets, The National Health Expenditures Account Team, “Health Care Spending Projections Through 2016: Modest Changes Obscure Part D’s Impact”, Health Affairs, March/April 2007, (26) 242-253.
[2] White Paper, Plexis Health Systems, Inc., “Pay for Performance: Improving Quality and Efficiency of Healthcare Delivery”, 2008, 1-4.
[3] Ralph Bell, PhD, Michael J, Krivich, CHE, “How to Use Patient Satisfaction Data to Improve Healthcare Quality”, ASQ, January 2000, 6 -7.
[4] Michael J. Krivich, FACHE, PCM, “Only Sixty-eight Percent Satisfied” Healthcare Matters Blog, April 2008, www.michael-healthcarematters.blogspot.com
© 2008, Michael J. Krivich, FACHE, PCM. All rights reserved.
Now back to the issues....
P4P, Patient Satisfaction and my read on what you need to do Mr. Hospital CEO......
Attempts at payment system reform to stem rising healthcare costs by controlling access and utilization through various insurance programs and market based reforms- PPOs, HMOs, MSAs and HSAs to name a few, have meet with limited success. With projected healthcare spending to potentially exceed $4.1 trillion by 2016[1], Pay-for-Performance (P4P) represents a potential mechanism to reign in unsustainable healthcare spending growth.
Pay-for-Performance, commonly referred to as P4P, is a concept whereby hospitals, health systems, physicians and other medical providers are incentivized along agreed upon quality standards for specific procedures. In return, they receive increased reimbursement rates based on meeting defined quality standards of which patient satisfaction is one of the critical performance measures.
The short historical background of the P4P movement begins in[2]:
1991, the National Committee for Quality Assurance (NCQA) with the introduction of the Health Plan Employer Data and Information Set (HEDIS)
2001, the Institute of Medicine proposes that quality-based incentive payments to healthcare providers can improve quality
2002, the Center for Medicare and Medicaid Services (CMS) launches its pay-for-performance plan based on 10 quality measures, and in conjunction with the Agency for Healthcare Research and Quality (AHRQ), develops and introduces HCAHPS
2003, Medicare Prescription Drug, Improvement and Modernization Act of 2003, hospitals reporting quality data in 2004 receive enhanced payments in 2005
2003, CMS and Premier launch the Premier Hospital Quality Incentive Demonstration Project (HQID)
2004, employer-based groups entered the P4P debate with the concept of “Care-Focused Purchasing” using quality standards based on medical evidence
2005, the Joint Commission and the American Medical Association begin to more heavily weigh into the debate
Underlying all is the concept that patient satisfaction is a key value-based decision driver patients can use to make reasonable purchasing evaluations when seeking treatment, as well as positively affecting patient compliance and adherence. Organizations demonstrating the ability to consistently deliver high levels of satisfaction will improve their quality outcomes and be rewarded accordingly through higher reimbursements.
The Patient Satisfaction Imperative
Satisfied patients[3]:
Are more compliant with treatment regimens
Even if the medical outcome is not good, believes that he or she had a quality medical experience.
Recommend you to others
Return to you for care
Litigate less
Highly satisfied patients are a source of continued revenue, cost avoidance and positive community image. A culture of satisfaction is one of the major focuses of the institution. Lead by senior executives, satisfaction is measured, evaluated and defined as an organizational imperative[4]. In a P4P environment where a portion of the hospitals reimbursement is at risk by not achieving required quality standards, the institutionalization of patient satisfaction processes, measurements and departmental change capabilities targeting benchmark performance can result in additional revenue. This enhanced revenue possibility could potentially be the difference between growth, expansion and continued mission, or an uncertain future that hospital leadership has little ability to control.
Taking Advantage of Pay-for-Performance
Understand that P4P is a risk-taking proposition requiring dedicated resources, measurement capabilities and access to proven quality improvement techniques and systems. The hospital or health system that applies the following principles established through years of research and market success can take a step forward confidentially thriving in a P4P environment. Some of the key programmatic elements for a successful venture into P4P include:
Robust survey
Rigorous measurement and analysis
Willingness to focus on change
Access to current thought-leaders, case studies and white papers
Peer group comparisons and the ability to network
Gain-sharing with physicians, employees and vendors
Vendor risk sharing and support
Conclusion
Pay-for-Performance represents a significant opportunity in the age of data transparency to improve quality, reduce costs and improve outcomes. Leadership’s action supported by proven expertise can allow for the taking of calculated, defined risks necessary to capitalize on payments for achieving high levels of patient satisfaction. As consumer-directed health becomes more relevant and employers continue to shift the cost of care to employees, high levels of patient satisfaction will be one of the determinants of reimbursement, exclusive agreements, expansion and market share growth.
[1] John A. Poisal, Christopher Truffer, Shelia Smith, Andrea Sisko, Cathy Cowan, Sean Keehan, Bridget Dickensheets, The National Health Expenditures Account Team, “Health Care Spending Projections Through 2016: Modest Changes Obscure Part D’s Impact”, Health Affairs, March/April 2007, (26) 242-253.
[2] White Paper, Plexis Health Systems, Inc., “Pay for Performance: Improving Quality and Efficiency of Healthcare Delivery”, 2008, 1-4.
[3] Ralph Bell, PhD, Michael J, Krivich, CHE, “How to Use Patient Satisfaction Data to Improve Healthcare Quality”, ASQ, January 2000, 6 -7.
[4] Michael J. Krivich, FACHE, PCM, “Only Sixty-eight Percent Satisfied” Healthcare Matters Blog, April 2008, www.michael-healthcarematters.blogspot.com
© 2008, Michael J. Krivich, FACHE, PCM. All rights reserved.
Universal Health Insurance Coverage
As the Democratic primaries come to a merciful end, focus will shift to the November general election. The topic that waxes and wanes depending on which voting group the contestants are reaching for is the rekindled discussion on national health insurance.
Clearly, as time and time again we are reminded, the healthcare system is in crisis and something must be done. No argument there. The question is fixed by whom and how much is this going to cost? Will the American public be willing to see taxes rise to support a universal health system? Will the insurance companies willingly give up billions of dollars under a one-payer system? Will the healthcare providers see this as a the savior of their way of life?
Who has the ability to bring all of the groups together, consumers, doctors, hospitals, nurses, insurance companies, government, employers, states, etc.? Any meaningful reform will need to be accomplished in year two and three of any new administration. Should anyone consider that reform can be accomplished in year one of a new presidency is frankly, dreaming.
All of that aside, let me pose a series of questions. If one has been reading the reports now circulating, we have several shortages, doctors, nurses and other clinical health professionals. Additionally, over the last decade, treatment patterns have shifted to hospital outpatient and free-standing ambulatory settings. The end result that a significant number of hospital beds nationwide have been permanently removed from the available inventory.
Let's for a moment say that consensus is reached in a remarkably short period of time and we have some form of national health insurance for the 47 million plus who have none. Think the system is in disarray now? What do you think will happen when suddenly 47 million men, women and children have access to the care they need? They have access to the right care, at the right time, in the right setting. And this does not even address the illegal immigration discussion.
Some form of national health insurance will generate great demand on an already taxed and over extended system. Bed shortages, waits for care, queues are what await us as we move forward. Costs will be controlled not by improvements in the quality of care, but by a natural process of access being limited due to excessive demand placed on services that the current healthcare system will be unable to provide.
A burgeoning new sub-segment of the healthcare system will arise. Service will be provided on an immediate basis to those who can pay privately for care outside of the system. A three tier system so to speak, those who can pay, those who have private or employer health insurance and those who have government. The more things change, the more they stay the same.
I am not saying that we should not have national health insurance for 47 million people. Personally, I believe that in one of the wealthiest country's in the world that it is unthinkable that we have such a situation.
This is one very complex issue and until all the issues are out on the table and under discussion instead of the simplistic proposals and idealistic views, change will happen and the unintended consequences of goodwill and policy will make an already bad situation worse.
Clearly, as time and time again we are reminded, the healthcare system is in crisis and something must be done. No argument there. The question is fixed by whom and how much is this going to cost? Will the American public be willing to see taxes rise to support a universal health system? Will the insurance companies willingly give up billions of dollars under a one-payer system? Will the healthcare providers see this as a the savior of their way of life?
Who has the ability to bring all of the groups together, consumers, doctors, hospitals, nurses, insurance companies, government, employers, states, etc.? Any meaningful reform will need to be accomplished in year two and three of any new administration. Should anyone consider that reform can be accomplished in year one of a new presidency is frankly, dreaming.
All of that aside, let me pose a series of questions. If one has been reading the reports now circulating, we have several shortages, doctors, nurses and other clinical health professionals. Additionally, over the last decade, treatment patterns have shifted to hospital outpatient and free-standing ambulatory settings. The end result that a significant number of hospital beds nationwide have been permanently removed from the available inventory.
Let's for a moment say that consensus is reached in a remarkably short period of time and we have some form of national health insurance for the 47 million plus who have none. Think the system is in disarray now? What do you think will happen when suddenly 47 million men, women and children have access to the care they need? They have access to the right care, at the right time, in the right setting. And this does not even address the illegal immigration discussion.
Some form of national health insurance will generate great demand on an already taxed and over extended system. Bed shortages, waits for care, queues are what await us as we move forward. Costs will be controlled not by improvements in the quality of care, but by a natural process of access being limited due to excessive demand placed on services that the current healthcare system will be unable to provide.
A burgeoning new sub-segment of the healthcare system will arise. Service will be provided on an immediate basis to those who can pay privately for care outside of the system. A three tier system so to speak, those who can pay, those who have private or employer health insurance and those who have government. The more things change, the more they stay the same.
I am not saying that we should not have national health insurance for 47 million people. Personally, I believe that in one of the wealthiest country's in the world that it is unthinkable that we have such a situation.
This is one very complex issue and until all the issues are out on the table and under discussion instead of the simplistic proposals and idealistic views, change will happen and the unintended consequences of goodwill and policy will make an already bad situation worse.
