Fragmented Data Can Be Barrier to Population Health, Healthy Margins

Gregory A. Freeman, December 18, 2017

Healthcare financial leaders often lack a true understanding of the cost of care across service lines or populations. Focusing too much on clinical data from the medical record can lead to overlooking critical claims and demographic data.

Managing costs across populations and networks depends on constant and thorough data analysis, but CFOs and other hospital leaders often are working with incomplete data as they make critical decisions about resources and revenue.

Fifty-eight percent of healthcare leader respondents in the June 2017 HealthLeaders Media survey, Cost and Revenue Strategies, cited that the lack of data on the true cost of care was the biggest barrier to achieving sustainable cost reductions.

Data fragmentation will make it difficult for many healthcare organizations to move to value-based care, says SCIO Health Analytics President Rose Higgins. Headquartered in West Hartford, Connecticut, SCIO provides analytics to support healthcare organizations.

"This becomes critical in the path to profitability. Most hospitals and healthcare systems, physician groups as well, are living with a tremendous amount of margin compression," she says. "When you couple that with the uncertainty of payment changes, revisions of the Affordable Care Act, and other developments, it becomes difficult to ensure operational effectiveness without understanding what's occurring in the populations you treat—particularly the populations with which you have risk-based contracts."

Taking on a commercial or CMS-based risk for certain patient populations makes it critical to know the costs of care across all settings of care, she says.

In the HealthLeaders Media survey, 36% of respondents said that they could determine the true cost of care for all (6%) or most (30%) of the care provided, while 51% said they could do it for some care provided, and 13% said that they were unable to determine the true cost for any care that they provided.

"When part of that care takes [you] outside your own borders, you can have leakage of revenue into other organizations," she says. "Making sure you have visibility to available data from those locations in which care delivered is important, or a proxy for that data such as claims data that can give you a more fulsome view into what's transpiring and the financial impact."

Twenty-six percent of survey respondents said they expected that by using information technology to target inappropriate claim denials, this could yield a positive financial impact for their most recent fiscal year.

Partnering

Fragmented data also can be problematic when the organizations looks at profitability and wants to consider partnerships with service lines, because it is important to understand the population and radius of care before aligning with them, she says. Contracting at the network level also requires understanding the potential volume gained in return for offering a lower price, for example.

"Fragmentation of data makes that a tough task for most organizations to accomplish," Higgins says.

Gregory A. Freeman

Gregory A. Freeman is a contributing writer.

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