Mnet Health News delivers the latest news and information articles for the world of healthcare.

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State Health Care Mandates Would Lower Uninsured Rate 

Millions of U.S. consumers would gain access to health insurance while their premium expenses would decline if all states implemented their own health care mandates, according to a study from The Commonwealth Fund and Urban Institute. Massachusetts and New Jersey have mandates and, if every state followed their lead, nearly four million consumers would have health insurance and premium costs would decline by an average of almost 12 percent, according to a news release from The Commonwealth Fund. 

“These mandates would replace the Affordable Care Act’s penalty for not having health insurance, a fee that Congress eliminated, effective 2019,” it states. Currently, the Affordable Care Act requires most Americans to have an insurance plan or face a financial penalty in an effort to “stabilize insurance markets by encouraging healthy people to purchase and stay enrolled in a health plan,” The Commonwealth Fund reports.  

The Congressional Budget Office expects premiums will rise and more consumers will lose their health insurance when the penalty is eliminated in January 2019. However, according to The Commonwealth Fund and Urban Institute Study, if states take the reins and create their own mandates:  

Millions more consumers would have health insurance. In fact, enacting state individual mandates across the country in 2019, when the federal penalties are lifted, would lower the number of uninsured by 3.9 million—or 11.4 percent.  

If all states enacted their own mandate, health care premiums would decline an average of 11.8 percent. The impact on premium rates would differ across states, for example, premiums would decline by more than 20 percent and Colorado, the District of Columbia, Kentucky, Nevada, North Dakota, Washington, and West Virginia would see declines of more than 15 percent.  

The study also shows uncompensated care costs for health care providers would significantly decline. “When patients are uninsured and can’t pay their medical bills, state and federal governments, as well as physicians, hospitals and community health centers, absorb the costs of this uncompensated care,” according to the news release. “As more people gain coverage mandates, demand for uncompensated care would fall by $11.4 billion nationally.  

States can also enact comparable mandate penalties to those at the federal level to mitigate any negative effects of eliminating the penalties under the Affordable Care Act. The study’s authors, Linda Blumberg, Matthew Buettgens and John Holahan from the Urban Institute note that there are significant challenges to getting state-level mandates off the ground.  

“Some states, for example, do not have state income taxes, and new financial structures would have to be developed to collect individual mandate penalties,” they report. “Other state political environments are not conducive to enacting individual mandate legislation, even in states where governors and state policymakers generally support the [Affordable Care Act.]”  

More information: More information: https://bit.ly/2mKefe5

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Health Care Merger and Acquisition Activity Builds Momentum 

Merger and acquisition activity in the health care sector remains strong this year, particularly for not-for-profit hospitals and health systems, according to an analysis by Kaufman Hall. The number of total transactions reached 50 in the first half of this year. In the second quarter alone, 16 of 21 transactions occurred among not-for-profit hospitals and health systems compared to five transactions among for-profit health care providers, according to the analysis (https://bit.ly/2LDRvKV).  

“When combined with first quarter results, more than 76 percent of deals announced in the first half of 2018 involve not-for-profit acquirers, while less than 24 percent involve for-profit acquirers.” “Not-for-profit hospital and health system leaders nationwide are moving aggressively to broaden their organizations’ base and expand their presence, extending capabilities across larger geographies in order to address continued uncertainty in the industry,” Anu Singh, managing director at Kaufman Hall, said in a news release.  

Revenue cycle management vendors for the health care industry should take note of these trends, according to Corporate Advisory Solutions (CAS), which recently published its second quarter report on merger and acquisition activity (https://bit.ly/2mMr1ZO

“This consolidation is positive for patients, increasing the quality of care to a larger population, but vendors will need to be larger and offer a wide breadth of service offerings to remain competitive,” according to the report. Overall, CAS reports the revenue cycle management (RCM) services sector bounced back to a “normal” volume of mergers and acquisitions after a quiet first quarter. There were five deals totaling a combined enterprise value of $987 million in the second quarter.  

“The RCM industry continues to experience robust growth, which is expected to persist moving forward,” CAS reports. Hospital merger and acquisition activity also continues at a fast pace which, according to data from the Healthcare Financial Management Association, included 25 transactions in the first half of this year, CAS reports. The industry is benefiting from growing health care expenditures which, CAS and the Altarum Institute report, are surpassing growth in the GDP.  

Year-over-year spending increased from 4.5 percent in December 2017 to 4.9 percent in February this year, according to the Altarum Institute. “Within the industry, a push from local governments and advocacy groups for increased price transparency may positively re-shape how consumers make decisions about their health care [expenditures.] A less opaque structure will surely cause prices to drop across the board, strongly benefiting individuals,” CAS reports.  

Finally, advances in telehealth bolster consolidation of health care systems as patients have access to personalized care at home and break away from the traditional care model. Among other trends to watch, according to CAS, providers continue their move toward value-based care payment structures. See Data Watch for a graph depicting the CAS findings on RCM mergers and acquisitions in the second quarter.

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New Propensity to Pay Technologies Can Reduce Payment Defaults from Self-pay

With revenue coming from self-pay increasingly becoming a large portion of the total revenue for healthcare providers, there’s an even greater need for innovative ways to approach the patient collection process. 

According to the National Association of Healthcare Access Management (NAHAM), self-pay is the third largest payer just behind Medicare and Medicaid. Patients now represent about 30 percent of healthcare revenue. 

Self-pay comes at a high price, especially for facilities looking to clamp down on cost and increase revenue. The cost of collection for self-pay is estimated to be three times that of commercial insurance. Moreover, a significant portion of self-pay balances go uncollected by providers and are eventually treated as bad debt.

Since this problem is connected to the growing financial responsibility of patients (many are unable to offset their medical bills without getting credit), it cannot be avoided. Surgery centers will still have to extend credit facilities to patients unable to settle their medical bills at the point of service.  

However, leveraging new technology has helped minimize the risk of default from patients while also simplifying the collection process for both patients and providers.

Recently, behavioral based propensity-to-pay models have been developed to overcome the limitation of accurately predicting the medical indebtedness of patients. The previous practice was to rely on credit scores to predict the probability of default by patients. Credit scores are however not well suited for this task as they focus more broadly on consumer debt.

This new technology relies on data from multiple sources to accurately predict patient’s likelihood of default. Based on their credit ranking, patients are then offered payment plans tailored to suit their ability to pay. 

Providers therefore have greater assurance of a lesser risk of default on the credit advanced to patients. This in turn results in win-win situation for both parties as their interests are aligned.

By being able to ascertain a patient’s ability to pay before surgery is conducted, an ASC can prevent default by engaging patients on the available payment options. Moreover, the time and effort spent unproductively on tracking collections from patients who are unlikely to pay will be significantly eliminated.

A facility can therefore re-prioritize by channeling more resources to patients with a higher probability of repaying their debts. This should in turn increase the facility’s revenue level while also improving their patient satisfaction ratings.

The increase in patient responsibility for medical expenses is changing the way self-pay is being approached by ambulatory surgery centers. At the core of this shift are innovative technology solutions that improve the collection process through computer-based algorithms.

Needless to say, centers will still have to engage with patients on a personal level to get information that software codes just cannot reveal.

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Care Quality: Is Value-Based Care Working?

Value-based care, the model that bases payments on quality of care, is starting to reduce medical costs and improve patient services, according to a recent survey from Change Healthcare conducted by ORC International.  In fact, the results show value-based care is accomplishing the “triple aim” sought after in the industry, meaning providing better care for consumers, improving population health management plans and lowering health care expenses.

According to “Finding the Value: The State of Value-Based Care in 2018,” the model is reducing unnecessary medical costs 5.6 percent on average while improving care and patient engagement.  Nearly 25 percent of respondents said their savings exceed 7.5 percent.  

“Despite easing or ending of federal mandates, commercial lines of business are investing in value-based innovation, accelerating the decline of pure fee-for service faster than previously projected levels. Indeed, today nearly two-thirds of payments are now based on value,” according to a news release on the survey from Change Healthcare (https://bit.ly/2KcCGyS).

The survey includes 120 payers such as Managed Medicare and Managed Medicaid across multiple regions and organization sizes.  “Payers are finding the positive impact of value-based care as they scale these models—particularly episodes of care—and that’s starting to bend the cost curve in a significant way,” Carolyn Wukitch, senior vice president and general manager, Network and Financial Management, Change Healthcare, said in the news release. 

“However, the demand to innovate at the pace of change is challenging payers. They lack satisfactory analytics and automation to better engage providers, operationalize their models and assess effectiveness overall.”  Additional findings from the survey include:

Nearly 80 percent of payers say they’ve experienced improvements in care quality, while 64 percent report improvements in provider relationships and 73 percent report better patient engagement.

The fee-for-service model is fading at a faster rate than predicted in previous studies, now representing just 37.2 percent of reimbursement, and projected to drop below 26 percent by 2021.

More than half of payers surveyed, however, “are not very satisfied with their current value-based analytics, automation and reporting capabilities—despite the fact that many of these are designed and developed in-house.”

Visit 2018VBCstudy.com to access the complete research report, Finding the Value: The State of Value-Based Reimbursement in 2018. Examples of value-based care models for health care providers are available from the Centers for Medicare and Medicaid Services (http://go.cms.gov/1jxyhoF.)

 

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Research Shows Growth in Health Care Prices

The prices for a range of health care services are growing more rapidly than economic inflation in the U.S., according to new research published by the Kaiser Family Foundation (KFF).  The research focuses on trends in health care prices, use of services and health care spending in the U.S. versus other similar countries.

Consumers with private insurance experience particularly high increases in costs for services. The KFF also finds that there is “significant geographic variation in prices.”  “For example, the average price of a full knee replacement for those in large employer plans increased from $19,595 in 2003 to $34,063 in 2016, growth of 74 percent compared to a 28 percent increase in general inflation,” it reports.

In New York City, the average cost of the same knee replacement is more than double the cost in the Louisville, Ky., area.  Overall, private insurance prices for inpatient hospital services are significantly more than what is paid by Medicare and Medicaid, and the gap is increasing over time, according to the KFF.

Compared to other countries, the KFF finds that the prices in the U.S. are higher for health care and prescription medications, but use of services, such as physician visits, is lower.  And, the average health care spending per person in other comparable countries is half as much. In the U.S. the average health expenditures per person in 2016 was $10,348, compared to $7,919 in Switzerland and $5,551 in Germany.

The U.S. spent 18 percent of its GDP on health care in 2016, compared to 12 percent in Switzerland.  More information: https://kaiserf.am/2yPwrMa

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What ASC’s Need to Know About Bundled Payments in a Value-Based Setting

 

Low cost and high-quality service delivery are the hallmarks of outpatient care in today’s value-based setting. Patients are out searching for providers that offer the best care at the lowest possible cost while payers are also driving care in-network due to the high financial burden of out-of-network arrangements.

To remain competitive, surgery centers must come up with strategies to increase reimbursements that will also be beneficial to patients and payers. One game-changing strategy that ASC’s can use is bundled payments. Unlike the traditional fee-for-service model, bundled payments are well suited for care delivered in today’s value-based environment.   

Bundled payments provide greater incentive for patients to approach ASC’s for surgeries and for payers to move more patients to surgery centers. Patients can avoid having to bear extra financial burden in the form of co-pays, deductibles, and high out-of-pocket payments connected to typical fee-for-service payment arrangements. Payers also get to enjoy significant cost reductions from bundled payments compared to the fee-for-service model.

Surgery centers will experience an increase in case volumes as more companies move into the bundled payments markets, especially if insurance companies decide to adopt it as an alternative payment strategy. 

However, bundled payment arrangements are yet to gain significant traction in the ASC space. The trend is poised to become mainstream as an alternative reimbursement strategy. Alternative payment models, which include those bundled, currently account for 30 percent of industry-wide payments made by Medicare.

Bundled payments could be retrospective or prospective. For prospective bundles, the provider is paid a fixed amount upfront by the insurer for all services to be rendered to the patient. The provider is therefore responsible for any additional cost incurred during administering treatment.  

But the most widely-adopted model used by hospitals is retrospective bundled payment. This operates in a similar fashion to the fee-for-service payment in that payers reimburse providers for the claims raised for the services offered to patients under their program. The payment made by the payers is then compared to the agreed bundled target price and any discrepancy is adjusted for. Providers will be reimbursed for payments made below the target price while payments made by payers above the target price will be retrieved.

ASC’s are better positioned to offer bundled payment arrangements than hospitals. This is because they can provide procedures offered at hospitals at high prices for a much lower rate. Also, it is easier for them to monitor their costs unlike hospitals who deal with a larger number of patients; complicating the task of tracking their cost. 

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Paper Billing Remains Prominent Among Health Care Providers; Price Transparency Improves

 

In a Waystar and HIMSS Analytics study of patients who visited a health care provider in the last year, new trends in price transparency and payments were revealed.  In particular, a majority of providers continue to issue paper statements, and cost estimates at time of service reflect improvement in price transparency, according to a news release on the Patient Payment Checkup Survey.

“Our second annual survey reveals that the health care industry is at a tipping point. Patients want to understand their health care expenses given how much they pay out of pocket,” Matthew Hawkins, CEO of Waystar a provider of revenue cycle technologies, said in the news release.  “At the same time, providers are looking for ways to increase patient satisfaction and simplify their revenue cycles.”

Key findings from the survey, including over 1,000 patients and approximately 900 financial executives in the health care industry, are: Nearly 100 percent of health care executives report that they bill patients using paper statements, however over half of patients said they would prefer to receive and pay their medical bills electronically.

Eighty-five percent of patients responding to the survey felt the same responsibility to pay for health care as they do other services, however less than 20 percent who have commercial insurance plans found it “easy to understand and convenient to pay for” health care costs.  Waystar also finds that cost estimates from their health provider help patients comprehend what they owe. Eighty-six percent of patients who received cost estimates report they understood their payment responsibility, which ultimately helps with faster and easier payment for providers.

However, less than one-third of patients surveyed said they know to ask for a cost estimate at their healthcare provider’s office while 87 percent of health care professionals participating in the survey say that they are able to offer their patients a cost estimate upon request.  “The survey indicates a significant difference between patients and their provider organizations in terms of perceived payment timeliness,” Waystar reports. 

Nearly half (48 percent) of providers said that it takes their patients over three months to pay the full balance of their bill, versus only 24 percent of patients thinking that it takes them longer than three months to pay their balance. “This perception gap may lie in the timing of payer reimbursement.  Patients may believe that they do not owe anything until their payers pay their share,” according to Waystar.

“Our survey reveals that patient consumerism is advancing quickly as organizations adopt advanced payment technology,” Hawkins concludes. “Patients have a higher expectation than they used to have.  It is important that lagging health care organizations improve their patient billing and payment methods faster to remain competitive. 

Patients are already seeking health care from providers whom they trust with both their health and their pocketbooks.  Providers who don’t provide transparency and convenience will be left behind.”

More information: https://bit.ly/2svglBL

 

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The Path to a Partnership

Mergers and acquisitions in the health care sector are expected to be robust in 2018 and continue to grow based on strong activity in the market, and trends such as the shift to value-based care models.  According to the Corporate Advisory Solutions (CAS) fourth quarter 2017 newsletter (https://bit.ly/2KjAn9R), at press time, mergers and acquisitions in the revenue cycle management sector have “remained consistent and we anticipate seeing a high level of activity in 2018.

Technological advances will dominate the conversation for RCM companies and health care providers. 2017 required health care organizations to respond to several challengaes and transformative trends, including the political landscape change, growing role of technology, and shift to value-based care.  USCB America’s recent merger and acquisition of RevSolve Inc. and J&L Teamworks, two health care-related industry leaders, is an example of this trend and how to stay ahead in the competitive marketplace.

RevSolve, a Scottsdale, Ariz.-based company formerly known as Collection Service Bureau Inc., is led by Chris Becraft. The ACA member company founded in 1964 was rebranded as RevSolve, a firm that prides itself on being “the best-in-class revenue solution for health care providers,” according to a press statement on the merger and acquisition released by the USCB America.

J&L Teamworks, also an ACA International member company, was established in 1990 in Lodi, Calif., as a receivables management services firm that works with hospitals, medical groups, clinics and physicians. The company, which was previously privately owned and managed by two business partners, is now part of USCB’s family of employee-owned companies.  

“In today’s fast-paced and competitive environment, it becomes critical to look for avenues to retain tenured and successful employees and to broaden the services offered to our business partners,” said Albert Cadena, USCB America’s CEO and president.  The companies worked with CAS, a merger and acquisition advisory firm and ACA International member based in Philadelphia, throughout the process.

“In my almost 20 years of providing M&A advisory services to the outsourced business services sector, I have not seen a better fit culturally and operationally than what exists between RevSolve and USCB America,” Mark Russell, managing partner at CAS, said in a news release on the merger.  Cadena said the merger with RevSolve and J&L Teamworks was the opportunity he had been seeking.

“I have been searching for a merger/acquisition with companies who specialize in the health care side of our industry for the last eight years or so,” he said. “This was a direction and a goal we needed to move forward with in order to continue to be competitive in the marketplace, acquire talented employees and also to expand our geographical presence.”  Cadena added that the decision to seek agencies to merge with was motivated by needs of his clients in the health care space.

“Health care providers are seeking a partner to provide an array of services in revenue cycle management,” Cadena said.  “We also saw in the industry that smaller companies were seeking for an exit strategy and the expectations from the health care receivable side were making it difficult for some to compete.”  Meanwhile, Becraft shared his resolution for the future of the company.

“In deciding the next chapter of our 53-year-old company, we looked for a partnership that could bring further depth to our health care revenue cycle services, a commitment to expand our presence in Arizona, and a culture that complements ours and that of our clients,” Becraft said. “We nailed every criterion. We are also proud to now be a 100 percent employee-owned company as part of this merger, which is a tremendous benefit to current employees and a huge competitive advantage to acquiring the best talent for the future.

Our staff are really in top spirits about all of it. As employee owners, they have a chance to have more than just a career; they own part of the business.”  Like USCB America, RevSolve was also reviewing its strategic direction for the past few years and how it could capitalize on opportunities available through working with health care provider clients.

“We too needed to be larger, but more importantly, we need to be able to offer a deeper stack of revenue cycle services to our current and prospective clients,” Becraft said. “We had a lot of criteria that included market facing objectives, but also internal ones such as how can this help our employees grow in their careers with the company.”

With this in mind, RevSolve was faced with three choices, he said … “develop the services ourselves, acquire other companies or merge with a complementary company.”  And, according to Becraft, the merger makes sense given the same trend is going on in the health care market.  “Health care providers are merging at breakneck speed and their needs are growing ever larger and more complex,” Becraft said.

“The most successful revenue cycle companies are expanding their relationships across multiple lines of services with their clients.”  RevSolve and J&L Teamworks join a host of proud Employee Owners at USCB America, who offer a full enterprise of health care revenue cycle and management solutions, according to the press release from USCB. USCB America has been in business for over 100 years and has been an employee-owned company for almost two decades.

“In both J&L and RevSolve I have seen positive feedback for all the employees, as always the unknown is on the minds of all, and it’s up to USCB to continue on its path of bringing [us] all together as one family,” Cadena said. “I have seen a lot of employees excited about growth opportunities and the options to possibly transfer to other office locations.”

When asked his advice for other companies considering a merger, Cadena said start by taking a look at your long-term goals.  “For us it was to strengthen our family of companies and to continue to provide excellent service to our current and future clients,” Cadena said.

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How ASC’s Can Negotiate for Higher Out-of-Network Reimbursements

In recent times, ambulatory surgery centers (ASC’s) have been confronted with the challenge of effectively negotiating for the highest reimbursement rates on services rendered out-of-network (OON). This was not the case decades ago, specifically in the early 1990s, when providers didn’t have to negotiate on out-of-network services as they were fully reimbursed by payers.

Today, reimbursements for out-of-network services have become very complex. Payers have now developed many tactics to make it difficult for providers to receive their full compensation.

Amongst other tactics adopted, payers now hire vendors to negotiate the lowest reimbursement rates from providers. This has made it possible for providers to be paid very low rates, as low as 20 percent of the compensation due to them, if they fail to actively negotiate for the best rates.

Providers will therefore have to develop strategies to ensure they receive 100 percent of their reimbursements. Here are 2 tips to consider for a successful negotiation:

Be Deliberate and Persistent in Negotiations

When it comes to negotiating for out-of-network reimbursements with payers, providers must be both deliberate and persistent. Vendors hired by payers will do their best to discourage providers from receiving their reimbursements in full.

Vendors receive higher commissions when they successfully negotiate lower reimbursement rates for payers; as such, they would normally develop tactics to out-smart unsuspecting providers when negotiating on behalf of payers. 

Providers must therefore be proactive in the negotiation process. An experienced staff is well-versed in contract negotiation and should see to out-of-network negotiations with vendors. Your center can also recruit experienced out-of-network negotiators to join the company or be contracted to serve as agents for your ASC to negotiate with payers or vendors. 

No matter how long it takes, responding to each counteroffer and following up with appealed underpayments will make a big difference. Be persistent in the negotiation process by making multiple calls, sending emails, and even scheduling meetings to ensure that the highest possible reimbursement rates are received. This strong negotiation process should be employed even if your center has low volume of out-of-network patients.

Appropriate Use of Data

The effective use of data is another strategy that ASC’s need to consider adopting in order to effectively negotiate for higher reimbursement rates. One tactic that payers employ to give the lowest reimbursement rates to providers is offering a different rate for the same procedure previously handled by the provider.

For example, an insurance company that paid 70 percent on a similar case a year ago might want to now offer 40 percent. An ASC can negotiate for the same rate, or maybe even a higher one, if it has data on the previous transaction. 

Payers are often more proactive in collecting and keeping data than providers. Third-party vendors manage their data effectively and use it to negotiate the lowest reimbursements from providers.

Most providers however do not keep track of the data from their previous negotiations; hence the lower reimbursement rates. 

Therefore, if you want to increase your bottom line, learn to be a persistent negotiator and back your strategy with data. When this is done, out-of-network reimbursements can be higher than in-network reimbursements. Your center has the flexibility and opportunity to set higher reimbursement rates that can make up for low rates set by government payers.

 

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News & Notes

Seminar: Duties of Data Furnishers Under the FCRA

If you furnish data for consumer reports, you know the importance of applying the Fair Credit Reporting Act to your current business practices. ACA International will offer a CORE Curriculum seminar May 10 to help you incorporate the FCRA and Regulation V into your Compliance Management System. Participants will also learn how to recognize alerts and respond to claims of identity theft and fraud. Register here: https://bit.ly/2pInq0t

Health Care Prices Reach Five-Year High

Health care prices in February increased by 2.2 percent compared to 2016 and 2 percent in January, the highest rate recorded since January 2012, according to the Altarum Institute’s latest Health Sector Economic Indicators report.  National health spending increased by 4.6 percent compared to 2016. Altarum also reports the health care sector experienced modest job growth during the first two months of this year. https://bit.ly/2pHptCe

 

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Health Care Costs Continue to Impact Consumers’ Decisions to Seek Medical Treatment

 

A new national poll shows that the cost of health care continues to impact whether consumers seek recommended medical care or visit the doctor when they are sick or injured.  The survey, from NORC at the University of Chicago and the West Health Institute shows approximately 40 percent of respondents skip medical care and 44 percent said they didn’t go to the doctor when needed.

“The February survey of more than 1,300 adults offers new insights into how Americans feel about the costs of health care and how they report those costs affect their medical decisions and personal finances,” according to a news release from NORC at the University of Chicago, a nonpartisan research institution.

Other findings in the survey include:

About 30 percent of respondents reported that they had to decide between paying for medical bills or essentials such as food, heating or housing during the last year.

More people fear the medical bills that come with a serious illness over being sick (40 percent versus 33 percent, respectively.)

Respondents who said they skip recommended medical care were about two times more likely to fear getting sick (47 percent versus 24 percent, respectively) and the costs of care (60 percent versus 27 percent, respectively.)

“The high cost of health care has become a public health crisis that cuts across all ages as more Americans are delaying or going without recommended medical tests and treatments,” Zia Agha, chief medical officer at the West Health Institute, a nonprofit applied medical research organization based in San Diego, said in the news release. “According to this survey, most Americans do not feel they are getting a good value for their health care dollars, and the rising cost of health care is clearly having a direct consequence on American’s health-and financial well-being.”

Respondents to the survey also avoid medications due to the cost. “About one-in-three respondents report they did not fill a prescription or took less than the prescribed dose to save money. Dental care also suffered. Nearly half say they went without a routine cleaning or check up in the last year, and 39 percent say they did not go to the dentist when they needed treatment,” according to the news release.  They also experience financial consequences due to the cost of health care and medical bills are often unexpected.

Over half of survey respondents said they have serious financial consequences due to the costs of health care. The consequences include using all or most of their savings (36 percent); borrowing money or adding to their credit card debt (32 percent); and lowering contributions to a savings plan (41 percent.)  

Over half of survey respondents also said they received a medical bill for care they thought was paid for through their health insurance and a similar amount said they received bills at a higher amount than they expected. More than 25 percent of respondents said a medical bill was sent to a collection agency within the last year.  

ACA International members may find more information on health care collections and billing practices through ACA SearchPoint™ (https://www.acainternational.org/searchpoint) using the health care tag.

More information on the survey:  https://bit.ly/2GggwWK

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Top 3 Reasons Why Some ASC’s Fail

In today’s value-based setting, ambulatory surgery centers (ASC’s) are fast emerging as the preferred choice for outpatient surgical procedures. However, research by the Advisory Board shows that since 2009, nearly half of new ASC’s that open also close. 

The reality is that many surgery centers can falter if they fail to pay attention to critical areas of inefficiencies and risk.

Here are 3 common reasons why some ASC’s fail and how they can be avoided: 

1. Failure to Attract Cases with High Reimbursements

The ability of ASC’s to drive high case volume to their facilities has been identified as crucial to their long-term growth. In order to remain competitive in an environment with low reimbursements, ASC’s will need to target more cases with higher profits. 

Relying solely on procedures with low reimbursement rates will not position a center to stay ahead of the competition. ASC’s will need to expand their areas of specialization by adding new procedures with high reimbursements. For instance, procedures such as major spine cases and total joint replacements (TJR) have the potential to generate higher profits.

2. Failure to Prioritize Patient Care

The quality of care delivered to patients must be a major concern for ASC’s. This is becoming more important today considering the shift towards consumerism in healthcare. More than ever before, patient care is taking center stage as being one of the most crucial factors contributing to the success of a surgery center.  

A strong culture of patient care is required in centers to prevent infections, complications and low patient satisfaction ratings. According to Aziz Berjis, DPM, Founder and Director of Glendale Outpatient Surgery Center; the “patient care has to come first.” As long as ASC’s stick with a high level of quality in patient care they will continue to attract more patients.

3. Poorly Managed Contracts

Effectively managing payor contracts is crucial to the growth of a surgery center. However, centers face numerous challenges in successfully managing the contracts they have with payors. 

A common challenge is that ASC administrators are overly burdened with so many tasks that they are unable to dedicate the time and focus needed to effectively manage payor contracts, especially those that are soon expiring.

With careful planning, ASC’s can allocate more time to negotiating payor contracts. This can be done by either forming a team in the organization saddled with the responsibility of payor contract negotiation or by recruiting more hands if the present staff strength is low.

By paying more attention to payor relationships, ASC’s can negotiate contracts that will lead to significant cost reduction. This will in turn enable them to save more money to fund the growth of their centers.

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