At the Margins

Our latest insight into health care margin improvement efforts

Optimizing total joint performance in an era of uncertainty

by Sean Angert, MBA, National Partner September 15, 2017

Sean Angert, MBA

In its July 13 proposal to take total knee replacements off the inpatient only list, CMS has effectively opened the door for total knee arthroplasty to become an outpatient service.

Potential implications of such a shift include a significant payment rate reduction, given the much lower reimbursement for procedures in the outpatient setting, well as an interactive effect on volumes eligible for CMS's Comprehensive Care for Joint Replacement (CJR) bundled payment model. In addition, competition for those procedures deemed clinically appropriate to remain in the inpatient setting likely would intensify.

The uncertainty about the future direction of payment for total joint procedures creates a complicated—and evolving—strategic challenge for health systems. That said, the changes will not happen overnight. Following the removal of partial knee arthroplasty in 2005 from the inpatient only list, the shift to outpatient has been steady but slow; in 2015, 48% of all Medicare cases involving partial knee arthroplasty were performed on an outpatient basis.

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Do your physicians speak finance?

by John Johnston, SVP and National Partner, and Vincent Joseph, VP September 6, 2017

Most finance leaders have at one time or another struggled to communicate with physicians about financial issues. Numerous administrators report that sometimes they come away from financial discussions feeling as if they have been speaking a foreign language. In fact, that's a pretty accurate characterization. Health care finance really is a language unto itself and can be quite foreign to most physicians.

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Quick poll: How consolidated is your revenue cycle?

by Eric Fontana and Robin Brand August 30, 2017

In the face of continued margin pressure, providers are looking for ways to increase the efficiency of the revenue cycle and constrain its associated costs.

One tried-and-true strategy for improving revenue cycle efficiency is to centralize and consolidate revenue cycle functions. But since most large systems have already centralized at least some revenue cycle functions from the front to the back office, it is not clear how much financial opportunity remains in further consolidation.

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Quick poll: Tell us about your outpatient CDI capabilities

by Eric Fontana and Robin Brand August 28, 2017

Inpatient clinical documentation improvement (CDI) programs are fairly ubiquitous at most hospitals. The reason is obvious: More accurate documentation helps optimize reimbursement by accurately capturing patient acuity.

However, progressive organizations are now considering the impact of clinical documentation beyond reimbursement alone, to include quality performance and risk adjustment—and are realizing they can't limit their CDI efforts to the inpatient space in order to achieve those goals.

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CMS appears set to cancel mandatory episodic payments

Eric Fontana August 14, 2017

On Thursday, the Office of Management and Budget (OMB) appears to have begun reviewing a new proposed rule titled: "Cancellation of Advancing Care Coordination through Episode Payment and Cardiac Rehabilitation Incentive Payment Models; Changes to Comprehensive Care for Joint Replacement Payment Model."

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Why the two-midnight rule should stay on all hospitals' radars

by Eric Fontana and Lulis Navarro August 8, 2017

With the lengthy "probe and educate" period completed, the two-midnight rule has largely fallen out of the news headlines. But as QIO (Quality Improvement Organizations) reviews resume and RAC (Recovery Audit Contractor) audits loom on the horizon, providers need to remain alert and proactively identify areas that may come under scrutiny.

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Volume shifts and penalty shake-ups: What you need to know about CMS's inpatient final rule

Eric Fontana August 3, 2017

Wednesday evening, CMS released the Inpatient Prospective Payment System (IPPS) Final Rule for FY 2018.

We'll be spending the next few weeks reviewing all 2,462 pages, and you can join our webinar on Thursday August 24th at 3 p.m. ET for the key takeaways. We'll examine the key updates for Medicare payments next fiscal year, including a positive payment rate update, expected growth in Medicare DSH payments, and updates to the quality reporting and pay-for-performance programs.

In the meantime, here are our early takeaways, focusing especially on two key aspects of April's IPPS proposed rule: the proposed coding shifts and changes to the hospital readmissions program methodology.

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The big PSI-90 change that could impact your P4P performance

by Eric Fontana and Kenna Hawes July 26, 2017

You might be familiar with the PSI-90, a patient safety measure included in CMS's Inpatient Quality Reporting Program (IQR), Value-Based Purchasing Program (VBP), and Hospital-Acquired Conditions Program (HAC).

What you might not know is that the PSI-90 measure is being updated, and these modifications might impact your finances through the HAC and VBP programs. Read on for answers to members' top questions about these changes.

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