When the pandemic hit in early 2020, financial losses for healthcare organizations were drastic.
“We were essentially hemorrhaging as an industry. In the course of four months, from March to June, it was estimated that the health care industry was losing about $50 billion a month,” says Jason Brown, CEO and Chief Strategy Officer at the marketing firm, Brown Parker & DeMarinis (BPD).
While the cavalry soon arrived in the form of three COVID vaccines, the virus has continued to disrupt operations, most recently due to a surge fueled by the Delta variant. Many health systems are now struggling to determine how they will regain their financial footing in its wake.
A “game changing,” precision marketing approach that helps to identify the most receptive consumers and engages them with personalized messaging, may help organizations do just that. Representatives from AdventHealth and its marketing partners, Optum and BPD, recently discussed this approach during the HealthLeaders Marketing Now Online Summit for Effective Marketing webinar.
Slipping market share
Even before the pandemic, AdventHealth, a 49-hospital system based in Central Florida, was feeling the pressure from an influx of competition and a light flu season resulting in declining ER volume, says Sharon Line Clary, vice president of strategic marketing & communications for AdventHealth. As the marketplace grew more crowded, so did the marketing space.
“We could no longer approach our marketing strategy like we did in the past. We had to find a way to break through the clutter,” says Line Clary.
The organization decided to pilot a precision marketing campaign designed to speak directly to the people who were most likely to use their services, says Anthony Cadieux, executive director of digital marketing strategy for AdventHealth. But they needed digital tools and help from marketing partners to make the leap.
“Cue Optum, which offers incredible visibility across the market to help you identify your best prospects,” says Cadieux. Optum’s detailed insights helped to identify people in the market area who were most likely to align with key hospital services and to create tailored messaging to turn them into customers.
Optum and BPD mined digital data to prioritize 850,000 people, dividing them into 11 specific cohorts, such as young singles without a primary care physician, married individuals with kids, very sick people with more than two or three diseases requiring complex and difficult care, and people of all ages suffering from unexplained stomach and abdominal pains.
BPD then designed unique messaging for each group, taking into account clinical needs, gender, language and culture, which were delivered to people using their preferred media channels at the times they were most likely to see it.
The campaign ran for six months, from October 2019 to March 2020, and was not only focused but nimble. “During the campaign we were optimizing and when people weren’t responding we were changing the message and continually looking at it,” says Line Clary. “We had tremendous results.”
The campaign directed 134,000 patients to AdventHealth, rather than competitor’s emergency departments, during the six-month period, says Cadieux. In terms of total net revenue, the return on marketing investment was a $474 return for every marketing dollar spent.
If your organization is interested in embarking on a similar approach, there are several factors to consider.
Cost. A campaign like this will require an initial budget of up to $250,000 to install the platform to obtain consumer data, and another $250,000 minimum to run the campaign itself, says Brown. “It’s not cheap, but as you can see from the results it’s also not expensive,” he says.
Time. A campaign should last at least six months, ideally 12-months, to be effective.
Flexibility. A precision marketing campaign can be adjusted or turned on and off at any time, says Line Clary. But to do this effectively it requires ongoing monitoring.
Access. Campaign success can be tracked in real time based on patient revenue, but the organization needs to grant access to this information to do so.
Keep in mind, that this is not your traditional marketing approach, so be prepared to learn as you go. Done well, precision marketing can not only help your organization shore up financial losses from the pandemic but may also help to better position your organization for future growth. Adopting a laser focused approach to marketing by reaching out directly to your most likely customers and engaging them in with personalized messaging can provide better results with less wasted effort.
Employers' health and well-being offerings are growing and becoming more nuanced.
Today, employers are getting smart, serious and sophisticated in their approach to employee health and well-being.
In the 10th annual Optum survey of employers across the U.S., 77% said offering employee health and well-being programs is very important to their benefits strategy—up from 64% the year before. Also, 81% expect their investment to continue to increase over the next few years.
Taking behavioral health needs seriously
Adopting sophisticated strategies to address complex conditions
Using demographics and technology to innovate programs
The way employers have shifted their approach to employee health and well-being over the past decade has been a remarkable evolution. It will continue to evolve over the coming years, according to the survey. The survey insights suggest opportunities to enhance well-being programs as well as ways to manage the challenges of administering them.
Health care organizations unveil innovations unlocking greater value in enhanced care coordination, collaboration and evidence-based medicine
“Care coordination takes on meaningful value once you know which patients can readily benefit from a targeted care program.” -- Alejandro Reti, M.D., Optum’s chief medical officer for Analytics
As health care organizations continue to create value-based care initiatives, being able to accurately identify patients who will benefit most from targeted care interventions is critical. But, with more patients moving into population health programs and an ever-expanding information pipeline, how do you know if you are targeting the right patients for such interventions? “It’s all about choosing the appropriate focus,” says Alejandro Reti, M.D., Optum’s chief medical officer for Analytics.
Breaking Through the Data: Whose Care Are You Coordinating?
Reti proposes that organizations need to view value-based care through a new lens for it to have the biggest clinical and financial impact. “Care coordination doesn't resolve all health care challenges. You need to know which patients can readily benefit from a targeted care program,” says Reti. “All barriers to health are not equal.” Reti notes that Optum is working with care providers to understand the concept of impressionable risk to better characterize the differences between patients who respond to programs and those who don’t.
“A program’s effectiveness relies on the strategic selection of risk analytics,” says Reti. For example, hospitals often design programs focused on reducing avoidable hospitalizations but make the mistake of relying solely on a total cost predictive model to direct patients to that program. While it’s true that there is a strong relationship between total costs and hospitalization rates, Reti believes there are better ways of using analytics to identify patients who are at risk of being hospitalized, such as focusing on those who have conditions that can be treated in an outpatient setting. “Models that look at risk of hospitalization or even risk of avoidable hospitalization are a better choice,” he says.
Using analytics, health care organizations can uncover recent hospitalizations, complex chronic diseases, and signs of poor disease control or therapy adherence to find patients who need help. Analytics can also be used to identify patients who require costly care, such as those undergoing active cancer treatments or in a terminal stage of an illness. “One of the things we are doing right now is looking at behavioral health and other factors to better identify patients likely to be responsive, so we can help advise hospitals on which types of programs better fit which patients,” says Reti.
At the same time, Reti points out recent studies on value-based care initiatives, particularly those aimed at reducing inpatient utilization and reducing total costs, have shown mixed results over the last few years. “One reason for this is hospitals are diluting what is already too little activity across too many patients,” says Reti. “If 10 percent of your total attributed population is qualifying for the high-risk program, and you are trying to reach them all, that is too many.”
Redefining Care Spectrum Strategies
Meanwhile, care providers are developing new approaches to meeting the full spectrum of patient care needs, including medical treatment, prescriptions and care plan adherence – with a spotlight on primary care. “Engaging the primary care provider in the process is incredibly important,” says Reti. “More organizations we work with are taking steps to do things as simple as identifying overlooked gaps in care at every specialist and primary care visit.” These data help them be more vigilant about addressing evidence-based quality measures, such as controlled blood pressure or blood sugar, and focus responsibility for action onto each clinician involved in a patient’s care.
“One medical group we work with has been particularly successful at focused information sharing,” says Reti. When the group began sharing information about patients with diabetes who had poor blood sugar control, they discovered that high-performing physicians tended to be more willing to make adjustments to their pharmaceutical regimens. They were also more likely to bring patients in for a visit every three months instead of every six, he notes.
Having a plan that addresses prescription drug adherence is another key component of care. This requires stronger collaboration among pharmacists, physicians and other care providers, as well as a sharp focus on data and analytics to ensure information is shared and that prescribing patterns fit into the patient’s overall care plan. “At Optum, research tells us that medication adherence is associated with fewer avoidable admissions,” says Reti. “The right predictive model can prospectively identify patients likely to have adherence issues.”
Finally, it’s critical to look at behavioral health and nonmedical support. Care providers need better behavioral health data, such as routinely collected depression scores, says Reti. He points out that pairing behavioral health specialists with clinical health specialists has been effective in addressing conditions such as depression and anxiety. “The evidence overwhelmingly supports the complicating effects of depression on chronic disease management,” says Reti. “Addressing the social sphere is also necessary to make a difference with some of the most challenged and often highest-cost patients,” he adds. For example, Florida Hospital in Orlando has been a pioneer in addressing homelessness as a path to reducing uncompensated care. By the time the hospital had spent $1.6 million of a pledged $6 million for supportive housing, they had already seen a $2.5 million reduction in uncompensated care.1
With a sharp focus on identifying the right patients for interventions, a comprehensive approach to patient care and purposeful collaboration among care providers, health care organizations are well-equipped to support positive clinical outcomes. “You need to be prepared to go where the trouble is and be prepared to make a difference,” says Reti.
Healthcare organizations are adopting innovative practices as they prepare for a new future
"The modern revenue cycle is becoming much more efficient using a technology platform that brings intelligence to the process." —Todd Gustin, SVP and general manager, revenue cycle technology solutions and professional services at Optum360
Today’s hospital revenue cycle wasn’t designed to handle the rapid changes taking place in healthcare—which is why it’s getting a much-needed overhaul, according to Todd Gustin, SVP and general manager, revenue cycle technology solutions and professional services at Optum360. "Much of the industry’s revenue cycle initiatives have been focused on resolving symptoms without getting to the root cause of challenges. This is why healthcare organizations require a more holistic approach that Optum360 offers," says Gustin.Hospitals and health systems need advanced solutions that support both where they are today in the fee-for-service world and the new processes they’re developing in light of the changing operating environment and healthcare economy.
Gustin says the modern revenue cycle can do just that. It’s flexible, easy to scale, and can quickly adapt to everything from new regulations to evolving industry dynamics. This is because it incorporates three key components: cost-saving automation, efficient staffing, and standardized technology. "As the transition to value-based care increases over the next couple of years, now is the time to take action and assess your revenue cycle’s readiness to continue to support both of these environments," he says.
Identifying top targets for cost-saving automation
The modern revenue cycle system helps healthcare organizations roll out cost-saving automation in critical areas such as health information management (HIM). For example, healthcare organizations are investing in technologies that integrate patient information from disparate systems to create a single patient financial record. Having a patient’s financial information in one place allows organizations to capture lost revenue from unbilled claims, reduce A/R days, improve HIM workflow, and create new efficiencies allowing for reallocation of staff and resources.
Patient access is another area where the modern revenue cycle promotes innovative, cost-saving changes. "It’s important to think about how consumers play into the revenue cycle in order to improve the patient experience, be more efficient, and reduce costs," says Gustin. To that end, sophisticated organizations use technology, analytics, and smarter processes that enable patients to register online, receive up-front cost estimates, pay their bills before getting treatment, and receive streamlined bills that are easy to understand. This improves the patient experience and reduces self-pay collections.
The modern revenue cycle also supports hospitals as they create more efficient payer processes, says Gustin. "There are a lot of great technologies and process improvements that fix errors on the back end of the revenue cycle, but it’s important to eliminate errors and the issues that ultimately cause denial up-front," he adds. "You need a denial prevention solution that ultimately reduces costs for providers and the payer."
The benefits of the modern technology platform
"Advanced technology platforms enable healthcare organizations to be competitive in today’s fee-for-service market, address current pressures, and rise to the next level of modernizing the revenue cycle and supporting innovation," says Gustin.
"Healthcare organizations must have a high-functioning technology platform to interact more effectively with patients and payers," he notes. "The modern revenue cycle is becoming much more efficient using a technology platform that brings intelligence to the process." Some of that intelligence will come through automation and smart technology." Current examples include computer-assisted coding and clinical documentation improvement, both of which are supported by natural language processing and designed to automate and drive results from unstructured data.
"Data that previously required a lot of time, resources, and hands-on labor to evaluate—and in some cases, was too complex to understand—can now be analyzed through a technology that uses automation and looks at both financial and clinical data in ways that weren't previously available," says Gustin. In turn, this improves coding and documentation methods as well as claims processes, such as by reducing denials and speeding up reimbursement.
New staffing models support the transition to value
Finally, having an efficient revenue cycle staffing model is essential as value-based care continues to unfold. The modern revenue cycle includes a staffing plan supported by a common technology platform, centralization, targeted data, and advanced workflow initiatives. For example, with these advances, organizations can shift staff around more quickly based on work volumes, as well as increase productivity and accountability through better metrics and reporting processes. "New staffing models, like the rest of a high-functioning revenue cycle, provide the flexibility, scalability, and standardized approach to support the healthcare organization," says Gustin.
Healthcare organizations are collaborating with healthcare services experts as they navigate growing challenges and create new opportunities
"The right expert can bring together the best-of-breed technology, a highly scaled platform, operational talent, and the expertise to solve the challenges that health systems and providers have today." —Todd Gustin, SVP and general manager, revenue cycle technology solutions and professional services, Optum360
As hospitals and health systems maneuver through the new healthcare landscape, they are shifting to a modern revenue cycle and bringing on strategic partners who can accelerate their path to success. "Healthcare organizations are feeling a tremendous amount of pressure across the revenue cycle from reimbursement changes, growth in consumerism, and increasing regulations," says Todd Gustin, SVP and general manager, revenue cycle technology solutions and professional services at Optum360. "As a result, they are looking carefully at what initiatives should be driven by internal experts vs. those, such as revenue cycle, that are best suited for an external partner with the right expertise."
First and foremost, Gustin recommends that hospitals and health systems partner with a healthcare services organization that offers multiple solutions, including oversight of the entire revenue cycle. "It is not about solving one particular challenge; you have to look at things more holistically," says Gustin. How do you find a partner who can handle your organization’s unique revenue cycle goals? Consider Gustin’s road map to a successful collaboration.
Start with a partner who will modernize your revenue cycle
"A strong partner will be ready to take your revenue cycle to the next level of efficiency and innovation by deploying the right people, processes, and technology," says Gustin. "The right expert can bring together the best-of-breed technology, a highly scaled platform, operational talent, and the expertise to solve the challenges that health systems and providers have today. They provide the stability and efficiency a healthcare organization needs to be competitive in this market environment."
Make sure your partner can scale key areas and predict costs
What kind of scalability does your potential partner have? "They should be able to apply technologies and processes to scale to make significant changes. A strong partner will have a broad customer base, like Optum360, which has 1,600 clients, so they can leverage their expertise and learn from their operations to improve and refine their offerings," says Gustin. A partner should also be able to offer predictable revenue cycle performance and costs. "You don’t want to be burdened with unknowns around infrastructure, technology-related investments, or additional capital."
Choose a partner who is innovative, collaborative, and future-focused
Healthcare organizations need a flexible, strategic partner who can help navigate challenges such as the demands of the savvy healthcare consumer. Technology advancements, consumerism, and rising costs are changing how patients interact with the healthcare system. Consumers are shopping around for health services; they want pre-service pricing estimates, 24/7 access to care, and electronic communication with their provider through mobile devices. These shifts are driving healthcare organizations to change their registration and billing processes—and for that, they need a sophisticated partner.
"A potential partner should be able to explain how they can help you impact the financial relationship that a patient has with a health system," says Gustin. For example, the partner should have solutions for common issues such as creating better pricing transparency, he notes. Some hospitals and health systems looking to increase their competitiveness are turning to outside partners for solutions that allow patients to estimate the cost of care, helping them make better healthcare decisions.
Additionally, a strategic partner should be innovative regarding the provider-payer relationship. "It’s important that providers and payers collaborate and eliminate the friction and waste that typically occurs between the two," says Gustin. "This has become an important role that health systems are looking for their partners to fill. It’s common to have a denials process which results in a lot of re-work that is inefficient, costly, and ultimately creates confusion for patients in the process. A strong partner will uncover problems, determine if they involve more than one payer, and find a solution that serves both payers and providers."
Renewing your focus on clinical innovations
The increasingly complex nature of healthcare is motivating healthcare organizations to partner with experts who can guide critical revenue cycle changes. When hospitals and health systems make the leap and find a trusted healthcare services company, they can return their focus to clinical areas, create new quality initiatives, and further prepare for value-based care.
Leaders must prioritize investments that improve patient care and the ability to manage financial risk.
“If you are able to use integrated data to drive strategic decision-making, you are really getting to value-based care nirvana.” — Amanda Skinner, vice president and general manager of managed value and risk analytics at Optum
In 2010, when value-based care seemed imminent, large healthcare organizations sprang into action, making significant investments in technology and population health management models. But the rest of the industry has not moved as quickly due to market pressures, uncertainty around healthcare reform, and a host of other factors. Taking a wait-and-see attitude, however, brings its own challenges, says Amanda Skinner, vice president and general manager of managed value and risk analytics at Optum. “The incremental approach makes the transition difficult because you are trying to live in two worlds.”
Breaking Through Bottlenecks and Assessing Readiness
Indeed, healthcare organizations that have succeeded under fee-for-service are reticent to dismantle their entire business and care delivery system to transition to an alternative payment model, says Skinner. Lack of payer pressure in some markets has also been a de-motivator. Ultimately, says Skinner, “regardless of what happens with healthcare reform, the idea of tying provider compensation to value is here to stay.” Healthcare organizations should plan now for how they will address external pressures pushing them closer to value-based care and what that means from an investment perspective, says Skinner.
Those healthcare organizations ready to accelerate must assess internal readiness for change and success under value-based models. “Leaders need to look at internal resources, core competencies, and existing technologies to determine if they have the ability to be successful at being accountable for the total cost of care while improving quality,” says Skinner.
Understanding Your Market’s Trends
Hospitals and health systems must be able to recognize their specific market factors, including competition from physicians and other organizations. Physician activities, such as consolidation patterns and an appetite for risk, must be carefully assessed to understand their impact. “Some hospitals and health systems may want to drive that trajectory as opposed to waiting to see what happens from the competition in the market,” says Skinner. Moreover, organizations looking to expand their provider network will need a growth strategy. “There are many options, including building new practices, acquiring existing groups, or forming a partnership or affiliation.”
Finding the Balance Between Physician Engagement and Acute Care Success
Nimbleness is essential when it comes to transforming a care delivery model, says Skinner. “Change can be difficult in complex organizations, but having better information enables and encourages care delivery transformation.” This involves understanding the intricacies of value-based care contracts and how they impact the total enterprise, as well as community obligations. For example, if a hospital-owned physician practice enters into an ACO care model, the practice will probably be required to reduce its utilization of unnecessary inpatient services. “You need to know how you will respond,” says Skinner. “Will you close beds, repurpose parts of your facilities, or is there a new strategy for continued enterprise growth?”
Skinner says, “It is also critical to engage physicians in meaningful ways, including asking them to be partners in changing care delivery processes, how their care teams are constructed, and how they operate the practice.” This may mean reevaluating compensation models for hospital-owned practices. “If you pay physicians based upon volume, but reimbursement is based on quality performance, there will be some tension,” she says.
For healthcare organizations that have already taken on some risk, are growing their network, and are using technology and analytics to speed their transition to value-based care, Skinner also recommends looking at strategic partnerships. “It is expensive to invest in infrastructure and develop the right analytic competencies to support all of your activities,” she says. Explore different types of partnerships, including working exclusively with a skilled expert who has multiple competencies and can guide value-based care strategies. Or, consider sharing infrastructure with other provider organizations while partnering with a vendor that has scaled these services in the past.
Creating a Value-Focused Investment Strategy
While healthcare organizations tend to focus on investments in patient care, those that also invest in technology and services—such as robust analytic capabilities, interventional programs to coordinate care and increase patient access, and change management processes to support care delivery transformation—improve their ability to manage financial risk and position themselves to thrive in a value-based world, says Skinner. These organizations have focused on translating their data into meaningful information that advances their contracting strategy, quality improvement, network development, care coordination, and patient engagement. “If you are able to use integrated data to drive strategic decision-making, you are really getting to value-based care nirvana,” says Skinner.
Value-based care is changing how providers negotiate and partner with payers
“[Payers and providers] must understand that they need to collaborate, operate off of shared data, and have a shared source of what is true.” — Amanda Skinner, vice president and general manager of managed value and risk analytics at Optum
As providers design value-based care strategies, some are exploring unique solutions to age-old problems, such as how to partner and negotiate effectively with payers. “Payers and providers have maintained disparate data and held different vantage points, and now we are moving to a world where providers must adopt some of the capabilities of health plans,” says Amanda Skinner, vice president and general manager of managed value and risk analytics at Optum. “As a result, providers are evolving to take on accountability that payers have historically had,” she adds. The challenge is also to operate in a fee-for-service environment while focusing on alternative payment models. “It’s a skill set that is hard to find, and one that requires integrating clinical and business analytics,” says Skinner.
The Art of Cooperation and Competition
To that point, provider organizations are increasingly seeking actionable information about their clinical and financial performance to negotiate better risk-based contracts and form stronger partnerships with payers. “It’s essential that they now see the whole enterprise, including the sensitive interplay between acute care, ambulatory operations, physician practices, clinical outcomes, and their postacute care networks, as well as the financial impact of their value-based contracting strategies,” says Skinner.
Having a blended view of clinical and payer data is important. “People often try to pit the data against each other, saying clinical data from the EMR is better than claims data or vice versa,” says Skinner. Both are critical to providers when it comes to value-based contracts. Clinical data from the EMR and ancillary systems offers real-time detail on what is happening with a patient. “This is important to building both an individual patient and a population-level view,” says Skinner.
At the same time, claims data often includes information about care delivered in settings that use a different medical record, which means it can provide a more comprehensive picture of patient care and reimbursement across the continuum, particularly if patients haven’t received all their services within a closed delivery system. “So the greater partnership around integrating these data sources in real time is becoming more significant,” says Skinner. “This is all leading to a place where payers and providers need to find a way to not just converge, but to move towards ‘coopetition,’ which means to cooperate while competing,” she adds. “They must understand that they need to collaborate, operate off of shared data, and have a shared source of what is true.”
Providers and Payers Collaborate to Serve Self-Insured Populations
With this in mind, many providers and payers are starting to forge common ground through new partnerships that focus on improving value for a hospital’s self-insured employee population. The hospital contracts with payers to be a third-party administrator. “This is where provider organizations and payers work well together and are able to develop a lot of expertise around succeeding together in value-based care,” says Skinner. Provider organizations that self-insure their employee population gain access to claims data because they are both employer and payer. “Also, as payer and provider, they have aligned financial incentives. The result is provider organizations are starting to bend the cost curve of their own self-insured population, while improving the quality of care and health of their employees, and seeing a real partnership form with payers,” adds Skinner.
Moreover, these partnerships can help create more flexibility in allowing providers and payers quicker access to each other’s real-time data. “However, payers will have to accelerate their claims adjudication process for this to be completely effective,” says Skinner. “Having up to a three-month lag for adjudication makes it challenging.”
As providers take on more risk, explore new relationships with payers, and gain access to new data, they will need to determine the best analytics strategy for value-based care and decide whether it makes sense to work with a partner, says Skinner. “An advanced healthcare services organization that has navigated complex provider and payer partnerships will have the expertise to integrate clinical, operating, and financial information, along with claims data, into a comprehensive picture. They will have not just data, but knowledge.”