A few months ago, I noted on the Geneia blog that hospitals and health systems face a gap between expectation and reality when it comes to patient experiences. In today’s post, I continue talking about hospital and health system technology needs in the current market, in particular as those needs relate to analytics that help these organizations meet CMS, operational and quality needs.
Despite ongoing convergence between various healthcare stakeholders, hospitals still stand apart in their unique reporting needs and particular financial concerns. The fact that hospital system Providence St. Joseph Health has launched its own analytics company suggests that similar organizations recognize a gap in the market when it comes to serving hospitals’ particular value-based needs.
Unlike consumers, providers, payers and employers who stand to benefit financially from value-based approaches, hospitals have been challenged by the fact that population health and value-based payment structures hurt their traditional business models, often driving down margins. In fact, earlier this summer, hospital profitability faced its first decline of the year, triggered by lower patient volume (presumably driven in part by the shift to preventive, patient-focused, value-based care approaches) and “the inability of many hospitals to rapidly cut expenses” to adjust to this changing landscape.
While hospitals as a whole are still more profitable than the insurance or pharmaceutical industries, recent market trends and the push for consumer price transparency are forcing hospitals and health systems to prepare for a world where profitability is not assured and patient satisfaction as well as quality of care are the main harbingers of long-term success. Given this reality, how can population health analytics be applied most meaningfully for hospitals while also benefiting their patients and partners? A few specific use cases come to mind as starting points:
- Better Support for CMS Reimbursement Models: One source of increased pressure for hospitals to further engage in value-based care is CMS. To succeed in CMS-specific arrangements, hospitals need tailored, specific reporting that may be particular to certain conditions or even certain states or locations.
Hospital star ratings, for instance, give consumers insight into cost and quality, requiring that hospital performance meet certain key thresholds. Additionally, since hospitals penalized under some CMS programs such as the Hospital Acquired Condition Reduction Program "do not demonstrate lower hospital-acquired condition rates than their non-penalized peers," it is clear that better reporting related to CMS programs would be beneficial to hospitals, particularly if such reporting contained actionable insights. Hospitals and health systems are in need of next-step solutions around how to better performance related to quality, cost, safety and patient experience.
- Analytics Specific to Small and Rural Facilities: Smaller or rural facilities are in need of specific types of reporting that help them prepare for value-based care while optimizing operations and financial performance within their current, resource-limited structure. In fact, part of the reason why CMS penalties don’t drive down infection rates is that the failing hospitals simply don’t have the financial backing—or the hospital-employed physician staff-- to fix the problem.
All hospitals and health systems could also benefit from more connected systems for collecting and analyzing social determinants of health (SDoH) data, but rural and smaller facilities in particular have much to gain from SDoH analytics given the specific populations they serve across Medicare and Medicaid plans.
- Reporting Specific to Outpatient Services: Part of succeeding with changing CMS guidelines is that there is a closing gap between hospital inpatient and outpatient revenue. As discussed above in relation to lower hospital patient volume, value-based approaches to health have encouraged consumers to seek more cost-effective care in outpatient settings. This shift requires hospitals and health systems to more closely track utilization of facilities that span beyond the ER, particularly for hospital systems with primary care, urgent care clinics, specialty practices and other outpatient services that are part of their larger organization or network.
- Analytics around Staffing and Operations: While hospitals continue to acquire and employ their own physician groups, a competitive labor market means that some physicians are leaving for independent practices. Further, with physician staffing a major expense for hospitals regardless of whether beds are filled, population health analytics around physician performance is a critical need for hospitals.
Physician benchmarking across specialty and primary care areas, as well as clinical quality performance by provider, are thus necessary insights that ensure physicians feel they are delivering the highest-quality care they can to patients (despite being part of a hospital system) while also allowing hospitals to see that their employed physicians are delivering on patient volume in support of revenue goals. There’s already evidence that predictive analytics can help hospitals and physician groups appropriately staff high-cost centers like emergency rooms.
- Improved Patient Experience: Finally, returning to the topic of our last hospital blog, hospitals can leverage population health analytics to continue to serve their patients in a market where competition for business is increasingly difficult. By understanding some of the themes mentioned above—SDoH, staffing needs for particular times, why certain procedures should be moved to outpatient settings to save patient and hospital dollars—hospitals will be catering to patients’ desire for cost transparency and personalized healthcare while supporting their own bottom line and quality of care ratings.
Overall, hospitals and health systems have a need for population health analytics across several specific areas, but according to a recent survey, less than 22% of hospital respondents polled were using analytics for population health. By keeping in mind that hospitals have financial concerns about the move to value-based programs--but that there are also many areas where supporting hospitals with analytics would simultaneously meet CMS, patient and physician needs—vendor partners like Geneia are delivering hospital and health system clients the targeted set of insights required for success in today’s current market.