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ICYMI: Trending Healthcare Topics for July 2016

By August 3, 2016April 23rd, 2024No Comments

ICYMI: Trending Healthcare Topics for July 2016

By Dan D'Orazio, CEO, Sage Growth Partners | August 3, 2016

An overview of the changes, trends, and newsmakers from the past month

Market trends defined by the nationwide shift to value based care dominates this month’s topics, while growth in telehealth and delivery care innovation strategies also round out the top news of July.

Transition to value based care:

  • Hospital consolidations continuing to rise: Kaurman Hall and Associates reported that hospital mergers and acquisitions rose by 6.1 percent when compared to 2015, as market players find ways to reduce costs and amplify competitive positions while transitioning into the value-based care (VBC) continuum.
  • More than half of payers’ business is already value-basedA McKesson report reveals that 58 percent of healthcare payers’ businesses have already shifted to full value-based reimbursement (VBR) models, a 10 percent increase since 2014. On the payment end, bundled payment is projected to grow fastest over the next five years, ahead of capitation and shared risk growth.
  • Cardiac care the next target of CMS’ bundled paymentsThe new cardiac program aims to make hospitals in 98 markets financially accountable for the cost and quality of all care associated with bypass surgery and heart attacks while reducing costs. In 2014 alone, hospitalizations for heart attacks for more than 200,000 beneficiaries cost Medicare over $6 billion.
  • Initial data imminent, but limited for CMS’ CJR bundled payment model: CMS is poised to release the first quarter’s performance data, but as recently pointed out in an article by Kelly Price, VP of DataGen, the initial data will fail to show performance on most episodes.
  • VBC bringing in multidisciplinary leadership roles: The national push towards value based care has driven hospitals to hire chief clinical officers with distinct duties compared to the chief medical officer. At a general level, CCOs must understand lean performance principles, adopt a management style that helps reduce waste and improve care quality, be familiar with EHR, and work to integrate quality data with better processes.

Innovation in healthcare delivery: 

  • Policymakers pushing to influence innovation: Iterative innovation is key to solving long-term, complex healthcare delivery problems. Policymakers are incentivizing organizations to adopt innovative strategies to deal with the one percent of healthcare customers that account for 25 percent of all expenditures, whether through risk adjustment schemes or by laying greater emphasis on consumerism in healthcare.
  • Hospitals learning from hospitality: Hospitals are looking to the hospitality industry to learn how to focus on delivering a more holistic consumer experience.  Paul Westbrook, former VP of patient experience at Inova Health System in Virginia, spoke about how such an initiative must be led by the senior leadership and penciled out target areas of focus like culture, communication, human resources processes, leadership development, and service excellence.
  • Big players taking steps into telehealthThomas Jefferson University Hospital and Mayo Clinic have jumped onto the growing telehealth bandwagon by making positive moves to extend patient services. Under the guidance of Stephen Klasko, MD, Jefferson organized programs to train physicians in telehealth and subsequently incentivized participation in such sessions. Mayo, on the other hand, strives to transition from a technology focused telehealth program to a clinically focused one, using telehealth as a catalyst for such initiatives.

Contentious government calls:

  • New, simpler ratings for hospitals are here, and big hospitals are not happyCMS is all set to move ahead with one to five star ratings for hospitals based on 64 individual measures that are already public on the government’s Hospital Compare website. The move has received considerable backlash from the industry and Congress in general but CMS is intent on offering patients a simplistic form of quality measurement compared to the complex measures that were previously used.  
  • Is the next generation ACO model failing? Centers for Medicare & Medicaid Services (CMS) faced setbacks in its “Next Generation” Accountable Care Organization (ACO) model program when more high profile ACOs exited from the Pioneer ACO program citing difficulties in cost target set by CMS. CMS is moving forward with the program as it strives to fixes difficulties associated with the shared savings program and plans to soon announce participants for 2017.
  • Government wildly underestimates Medicaid patient expensesThe government’s error in forecasting Medicaid expenses for 2015 was brought to light after the annual report revealed the average Medicaid enrollee costed 50 percent higher than expected. Medicaid expansion has led to increasing costs with Medicaid spending reached $554.3 billion in 2015.