At the Margins

Our latest insight into health care margin improvement efforts

Maximize your reimbursement with accurate HCC capture

Robin Brand and Jamie Landsman April 18, 2018

Hierarchical Condition Categories (HCCs) have been included in Medicare's methodology for risk adjusting provider payment since 2004. And while not new, they continue to be a topic of concern for many health systems. This concern is being driven by two larger industry trends: the tightening of margins, and increasing enrollment in Medicare Advantage (MA) plans.

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What do finance leaders have to do with high-reliability patient care?

John Johnston, CPA, MHA March 29, 2018

The challenges hospitals and health systems face in providing patient care with consistently high levels of safety and quality have never been more complicated, or more important. Inpatient admission data from hospital and health system members of Advisory Board's technology programs consistently show patient severity levels increasing over the past three years—indicating that hospital inpatients are sicker and that managing their outcomes is more difficult. At the same time, public awareness of safety failures—together with increased attention to quality metrics by consumers and payers—means that performance shortfalls are under greater scrutiny. Furthermore, publicly reported metrics such as rates of hospital-acquired conditions (HACs) and readmissions carry the potential for payment penalties imposed by health plans and government payers alike.

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'Change is coming': 4 takeaways on the HHS secretary's vision for our industry

by Trevor Goldsmith March 22, 2018

"Change is possible, change is necessary, and change is coming."

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3 reasons the Bipartisan Budget Act of 2018 might signal bad news to come for providers

Trevor Goldsmith March 14, 2018

With the benefit of hindsight, the Bipartisan Budget Act (BBA) of 2018 not only looks like the most significant health care legislation since 2015's MACRA—it also appears to validate the power of major advocacy organizations to push through incremental legislative change in an otherwise gridlocked political environment.

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The BPCI Advanced application period ends Monday. Should you apply?

Trevor Goldsmith March 7, 2018

In early January, CMS opened up the application period for Bundled Payments for Care Improvement (BPCI) Advanced, the first new payment model to be proposed under the Trump administration.

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Quick poll: What are your top strategic challenges and priorities across 2018?

Eric Fontana , Robin Brand March 1, 2018

What's keeping you up at night? How to improve your patients' financial experience? Denials prevention and management? Payer contracting strategy?

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The promise—and pitfalls—of integrating corporate services

John Johnston, CPA, MHA February 22, 2018

The past few years have seen a frenzy of health system mergers, as providers look to consolidation as a means to get on solid strategic and financial ground for a very challenging future. But for many, while consolidation has often succeeded in bringing greater price leverage and buying power, the larger, hoped-for financial benefits have been elusive. According to a study of recent mergers and acquisitions, 59% of acquired hospitals failed to outperform their market peers two years after acquisition. Moreover, one in five acquired hospitals actually went from having positive margins before being acquired to negative margins two years after the acquisition.

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Want to improve your margin performance? We can help.

by Eric Fontana and Trevor Goldsmith February 8, 2018

Hospitals and health systems feeling margin pressures are not alone. Moody's recently predicted that not-for-profits health systems' operating cash flow will shrink by 2% to 4% over the next 18 months. Indeed, in an environment of rising costs and uncertain revenue growth, there are no shortage of reasons for flagging margins.

But although the cost and revenue challenges are industry wide, their exact impact can differ significantly from hospital to hospital. To define and implement an effective margin strategy, hospitals need to understand the root causes of their margin performance. 

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