At the Margins

Our latest insight into health care margin improvement efforts

What we learned from C-suite executives on price transparency

Bethany Black February 8, 2016

With the rise of high-deductible health plans (HDHPs) and varied government mandates, executives are rightly worried about staying competitive in an increasingly price-sensitive world. Across 2015, Advisory Board consultants sat down with C-suite executives nationwide to discuss their price transparency strategies.

Our team found that, by and large, most organizations are taking one of three approaches, ranging from doing nothing to doing too much too fast. While the approaches might vary drastically, one aspect of our conversations remained consistent. The executives we spoke with expressed a desire to do more.

Let’s examine why these approaches often fall short and how progressive organizations are approaching price transparency.

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No rest for the weary: After ICD-10, it's time to focus on quality

Rebecca Beattie February 5, 2016

Last year, all of the hospital executives I talked to were frantically preparing for the impending ICD-10 transition, upgrading computer systems and training staff to use thousands of new codes.

Now that the transition has come and gone, and has by almost all accounts been far smoother than anticipated, you may be tempted to shift your focus to other areas. However, with the Centers for Medicare and Medicaid Services (CMS’s) increasing emphasis on tying reimbursement to quality, be sure that all of the investments you made continue to work for you.

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Do your physicians need supply cost motivation? Try CJR.

Brian Pellegrini January 29, 2016

The Comprehensive Care for Joint Replacement (CJR) Final Rule is out. And, while we know that reducing post-acute care costs is the biggest opportunity, CJR should also prompt you to take a closer look—yet again—at internal supply costs.

I know that we’ve been talking about supply cost for years, and I also know that supply cost savings are not likely to inflect your overall episodic payment. However, I am confident that CJR is a great opportunity to target these costs.

With everyone thinking about the complete episode of lower-extremity joint replacements under CJR, it’s not a big stretch to engage your physicians in a conversation focused on medical device costs. Also, medical device savings will directly impact your bottom line, regardless of how your organization performs under CJR.

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CFOs' top priority for CJR: Reduce post-acute care costs

Eric Fontana January 11, 2016

Over 600 members joined us for our full review of the Comprehensive Care for Joint Replacement (CJR) Final Rule. By popular demand, we’ll be hosting a second presentation on January 12 at 3 p.m. ET, where we’ll cover key highlights of the program and discuss important next steps for participants and what non-participants should watch out for.

Read on to find out where your peers are focusing their energies with respect to the CJR program and bundled payments more broadly.

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How much is unchecked energy use costing you?

by Victoria Niblock January 8, 2016

When we think about climate change, the first offenders that come to mind are typically from the utility or auto industries. However, the health care sector also has a large and costly environmental footprint. The health care industry accounts for 8% of U.S. greenhouse gas emissions and carbon dioxide emissions, and in particular hospitals are among the country’s most energy-intensive facilities.

The cost of this unchecked energy usage comes not only at the peril of our population’s health, but also with a huge price tag. On average, a health system spends 2-5% of its annual operating expense on energy.

The good news is that there is significant opportunity for health systems to both curb energy use and to reduce their overall energy spend.

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Five strategies you need to succeed in the emerging episodic world

Bethany Black December 18, 2015

2018 might seem like a long way off. But in the world of bundled payments, it’s not.

Medicare has set a goal of shifting 50% of Medicare payments to alternate forms by 2018. As bundled payments have gained prominence in recent years as one of those alternative payment methods, employers and health plans have begun experimenting with pilot programs and scaling successful models.

Early preparation is critical. Let’s review specific tactics that our Payment Integrity Compass team shares with members to ensure success with commercial bundled payment agreements.

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Four takeaways from Intermountain on transforming supply chain

Harry Kirschner December 2, 2015

Recently, the Advisory Board’s Spend Performance Solutions teamed up with Intermountain and invited 25+ supply chain leaders from across the country to travel to Salt Lake City, Utah, to get a look “under the hood” of its high-performing Supply Chain Organization (SCO).

Since its formation 10 years ago, Intermountain’s SCO has delivered $500M+ in savings for the health system that serves 22 hospitals in Utah and Idaho. This impressive feat earned Intermountain four national supply chain awards. As a result, we were excited to learn how they focus on creating value beyond price, refining stakeholder engagement, and effectively leveraging technology and analytics.

Joe Walsh, Intermountain’s vice president of supply chain and CPO, and his team spoke to us about transforming the supply chain function to achieve its full potential. Based on their results, they believe supply chain can be a strategic asset for helping health care organizations thrive in a value-based economy. Our day-long discussion allowed the entire group to share numerous perspectives and tactics. Below are four key insights for organizations looking to follow Intermountain’s path towards supply chain transformation and innovation.

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ICD-10 from the inside: Why SSM Healthcare stopped sweating the small stuff

Alex Guambana November 19, 2015

This is part of a series of weekly posts from the frontlines of the ICD-10 transition. Each blog post will recap interviews with Advisory Board members who talk to us about the transition at their organization. Make sure you're subscribed to our blog so you don't miss out.

While ICD-10 has not been the juggernaut everyone expected, few organizations are coming away completely unscathed. For an industry not known for efficiency or adaptability, there is the danger that small-scale coding and billing hiccups could exact a cumulative toll on the productivity of health care organizations. But larger concerns are also starting to take center stage.

We spoke with Carole McEwan, ICD-10 Project Manager for SSM Healthcare, to learn her take on the road ahead. In charge of the ICD-10 response for a major health system covering most of the Midwest, Carole was understandably hesitant to call ICD-10 a non-event. Yet rather than sweat the small stuff, Carole recommends focusing on larger, and arguably more realistic, concerns: payer denials and physician practice coding.

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