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Value-Based Reimbursement Knowledge Hub

Health care payment reform aims to fix the broken reimbursement system in the U.S. See what it takes to thrive in this new, value-based payment environment.

Hospital & Health System Success

Robust data

To understand whether value is being achieved in healthcare, proper measurement is critical. How will practices know if they are providing quality care at reasonable cost? The answer is with robust healthcare data.

To succeed under value based payment models, practices need healthcare data solutions that provide the total picture of care for all patients: where patients go outside of the practice, lab results, prescription data, eligibility, and healthcare costs.

Here are three essential categories of healthcare data that healthcare organizations must have visibility and access to in order to succeed in value based healthcare.

Health care data for managing costs

One of the keystones of payment reform is better management of costs. This requires practices and health systems to have solutions that provide deep insight into productivity and other costs associated with providing care.

Practices also need to consider using data to discuss costs with patients, enlisting their involvement to ensure that treatments occur in the most cost-effective way that serves patients’ needs. Financial counseling can enable practices to direct patients to lower-cost procedures and help them avoid unnecessary care—both of which will be required under many forms of payment reform.

Health care data for connectivity

To improve care and lower costs, practices also need healthcare data solutions that easily connect them to other healthcare providers and services, to enable efficient data exchange. Healthcare data solutions that offer a seamless, cost-effective method for connectivity and data exchange can help practices reduce costs through efficient, accurate communication. When connectivity is part of practices’ operations, they can meet foundational payment reform requirements, cut costs for duplicate testing and redundant care, and ensure that they have data at the point of care, to achieve the quality care goals some payment reforms will set.

To do this, practices need healthcare data solutions with an electronic health records (EHR) system that:
  • Can establish reliable, efficient electronic healthcare data exchange with payers, hospitals, labs, imaging centers, state registries, and other entities that provide services to patients
  • Tracks patient lab and prescription orders, including providing results and alerting practices when action is needed; and
  • Is ready—and certified—for the demands of Stage 2 Meaningful Use and other payment reform initiatives

Health care data for referral management

Finally, and equally as important, healthcare organizations need healthcare data solutions to manage referrals and keep a complete record of care for each patient. This must happen to ensure that patients get the best care at the most reasonable cost.

In order to do this effectively, practices need:
  • Access to the location, capabilities, quality, and cost of third-party healthcare service providers, both inside and outside their network
  • Effective healthcare data exchange with local hospitals to track patient admissions, and discharges and transfers (ADT), including automatic notification when patients are admitted or discharged; and
  • Convenient options to make the above information accessible to both providers and patients
Care management & quality management

One way the health care industry can address spiraling costs is by reducing hospitalizations. The method by which to do that is population health management—that is, employing effective care management strategies that identify particular groups of patients based on their conditions and needs, and care for them in a way that keeps them healthier and away from more expensive procedures. Providers who excel at efficient care management will emerge as the low-cost, high quality providers who thrive under health care reform.

Good population health management requires providers to: 

Perform high-risk care management. Providers need to be able to identify which patients need which prevention at what time—and get it to them. With strong care management, health care providers are identifying high-risk patients, tracking the services they receive and proactively communicating about their health needs. This helps their highest risk patients achieve good health outcomes and avoid unnecessary hospitalizations or use of emergency services such as the ER.

Develop and monitor care plans. Care monitoring is the process of checking on patients’ status and needs, as well as the services they are getting to address those needs. Proper care management and monitoring are necessary to measure and evaluate progress toward health outcomes, activities that health care reform programs require of participants to demonstrate good population health management.

Coordinate care with other providers. Health care now requires services from a range of providers—primary care physicians, specialists, nurses, technicians, other clinicians—but each individual member of the team has limited interaction with the patient. As a result, the health care team's view of the patient can become fragmented into disconnected facts.1 Having the right electronic health record (EHR) system in place can help with effective care management by integrating and organizing patient health information, and facilitating its instant distribution and availability among all authorized providers involved in a patient's care.
Use appropriate patient engagement tools. Good population health management requires understanding patients’ health care needs and communicating effectively with them to ensure they receive the right care at the right time. A comprehensive set of patient communication capabilities must include:
  • Reaching patients via phone, text message, or email in to inform them of their health care needs and get them into the office for treatment
  • Enabling two-way communication with patients to keep them on track while efficiently answering questions they have about their care; this can often be efficiently achieved with a patient portal that enables a secure messaging exchange between patients and a practice or health system
  • Communicating results of third-party orders (such as labs) to patients in order to guide their behavior; again, a patient portal can be an enormous help in maintaining this connection and effectively making results available.
Revenue cycle management

To succeed under new, quality-focused payment models, healthcare organizations need to move beyond typical revenue cycle management systems and adopt tools that are more sophisticated. Conventional revenue cycle management solutions are simply not sufficient for meeting the demands of new reimbursement models, which require the ability to track and submit cost and quality data, as well as receive and appropriately distribute compensation based on practice performance.

In recent years, the healthcare revenue cycle has taken a backseat to other initiatives that have demanded providers’ focus on initiatives such Meaningful Use. But with payment reform now becoming a reality, physician practices must consider new revenue cycle management solutions as the old way of submitting and tracking payment—the fee-for-service method of performing a service, submitting a claim, and getting paid for the service—becomes outdated.

Medical practices and health systems will need to either transition to a new revenue cycle management system, or make sure their current healthcare revenue cycle vendor can handle the new requirements. Organizations should look to revenue cycle management solutions that offer all of the following:
  • Efficient billing, invoicing, claims processing and other revenue cycle management activities designed to keep denials low, days in accounts receivable (DAR) down, and providers focused on patient care
  • Ongoing visibility into financial performance, so practices and health systems can make improvements based on results and plan intelligently for the future
  • The ability to reconcile group and individual payments against services provided, to track costs and outcomes
Close coordination with electronic health record (EHR) software to link clinical and financial outcomes, demonstrate success, and identify where improvements are needed to provide the highest quality patient care while maximizing reimbursement.

1 Improved care coordination. Available at:


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