Cash is king, whether health care organizations like it or not. Moving from volume- to value-based care puts revenue at risk when cash flow is critical. There are three specific areas where organizations can improve revenue:
- Denials management — Denied claims limit cash flow and negate work already completed. Plus, they add more work for staff members who must recover revenue. Focusing on patient access, medical necessity, coding and documentation can help stop denials before they happen. If a denial occurs, technological tools can help capture, identify and correct causes.
- Claims management — When a claim doesn’t match how a specific payer adjudicates it, it often is denied. Claims editing software and review technology can assist in identifying problems before the claim is ever sent.
- Collections — As insurance deductibles increase, patients are paying more out-of-pocket, and collecting self-pay portions of bills is never an easy task. A managed collection service combines technology with staff to help providers increase cash flow and net revenue, as well as reduce accounts receivable days and the cost-to-collect ratio.
While some organizations need to eke more efficiency out of their revenue cycle, others have optimized their financial performance to the point where they can draw no more resources out of them. The next stage in the journey from providing care to managing health is putting a plan in place — a roadmap, if you will — for transitioning from volume to value.
As organizations move to value-based care, the risk dynamics change from an operational to a population focus. Bearing population risk means concentrating on the value of care delivered to a defined population, and it requires innovative and transformational care delivery models to manage different risk segments.
Stratifying and risk segmenting the population helps risk-bearing provider organizations align the appropriate care delivery models with the clinical needs of the population. In addition, it allows provider organizations to target investments in improving quality, managing costs and delivering patient-centric care. Ultimately, successfully shifting from an operational focus to a risk focus requires that all players — physicians, other clinicians, facilities, payers and even patients — are incentivized to act in alignment.
More about this transition can be found in our latest white paper The journey from providing care to managing health.
In our next post, we’ll discuss how provider organizations must understand the needs of their populations to provide value-based care.