In this article, we address the most pressing key drivers of healthcare organizations’ margin pressure.
As physician enterprises continue to play a vital role in organizations’ ability to deliver patient care, hospitals and health systems across the country are feeling the financial burden and operating loss impact of their medical groups. These challenges have been further exasperated by declining reimbursements and increased operating costs fueled by the COVID-19 pandemic. Medical groups continue to be large and complex, and misalignment between physician groups and organizational strategies and goals can be detrimental to overall financial viability.
The Medical Group Management Association reports that the median losses on hospital-owned medical groups averaged $242,285 per physician in 2020. For most hospitals and health systems, this level of subsidy is unsustainable. Transforming medical group performance is imperative to organizational excellence. Following are the most pressing key drivers impacting margin pressure in healthcare organizations:
- Patient access
- Call center optimization
- Provider compensation and engagement
- Operational expense reduction
- Coding and documentation
Patient access is defined broadly as the availability of healthcare. More specifically, patient access is ensuring patients can conveniently see the right healthcare provider when they need care. If you called to schedule your child for a physical and the next available appointment at the pediatrician’s office was months away, you would likely consider finding a new pediatrician’s office with better patient access. Patient access is imperative to both meeting the healthcare needs of patients and managing patient demand.
Patient access improvements should go beyond traditional provider productivity methods that focus primarily on increasing work relative value units (wRVUs) and volumes, and instead should focus on the patient. Redesigned provider schedules, streamlined schedule management, and clearly defined appointment slots allow organizations to drive financial improvement and enhance patients’ access to care.
Call Center Optimization
Patients expect to be able to make appointments quickly, conveniently, and easily. Imagine calling to make an appointment with your primary care physician and waiting for 45 minutes before you were able to speak to an agent to schedule the appointment. An effective call center is the first step in providing an excellent patient experience. High-performing organizations utilize concierge services that add personal attention, detail, and convenience to patient scheduling. In addition, they utilize standardized appointment confirmation and patient recall processes, as well as patient online scheduling tools.
Provider Compensation and Engagement
As with all service industries, people are an organization’s most important asset. High-performing organizations ensure their providers are compensated equitably and in a way that aligns with organization goals and strategies. In addition, involving providers in improvement initiatives and key decisions promotes provider engagement and further drives alignment. Provider compensation is complex but is an important driver that can fuel success and provider satisfaction.
With medical group investment per physician FTE reaching all-time highs, reducing unnecessary expenses is the top priority for organizations across the country. Reimbursement shifts from value to volume and the financial strain caused by the COVID-19 pandemic are exasperating these financial challenges. Expense reduction looks different for every organization, and the key is finding the right formula that meets your organization’s unique needs.
Coding and Documentation
Maximizing reimbursement requires correct coding and documentation, and many providers do not have the education, tools, or resources necessary to effectively document patient care. In fact, most providers did not receive any formal coding and documentation education in school. The challenges of clinical documentation are multifaceted and change rapidly with new regulations and rules. Addressing common challenges in coding and documentation processes and workflows not only improves revenue, but also improves provider satisfaction and allows providers more time to focus on what matters most: the patients.
Impact Advisors offers comprehensive Physician Enterprise Solutions to improve operational and financial performance.