Big or small, health systems cannot transform healthcare delivery on their own. “I think every CEO knows that already, and now they are asking: ‘What is the best way to accomplish that transformation with others? Who is going to be your best partner?’” says Tom Wilhelmsen, president and CEO, Southern New Hampshire Health System.
The right partnership strategy will vary from one health system to the next, depending on the system’s strengths and weaknesses, its strategic plan, and market factors. In New Hampshire, Wilhelmsen and the CEOs of four other health systems—Concord Hospital, Elliot Health System, LRGHealthcare, and Wentworth-Douglass Hospital—decided that creating a network of community health systems was the best approach.
None of the five independent health systems that participate in Granite Health Network (GHN) would be considered large by national standards. But together they employ more than 900 physicians and account for 50 percent of the health care provided in New Hampshire—and they are using that scale to make a big impact.
Efficiencies of scale. Since forming in 2010, all five GHN partners contracted with a single reference lab, collectively saving more than $1 million a year on the analysis of unusual or obscure tests not performed by their own hospital labs.
In addition, they formed the Granite Shield Investment Exchange to self-insure against medical malpractice claims.
Recognizing their shared interest in reducing employee benefit costs, the five health systems also share a common health benefits broker and are moving to a single pharmacy benefit manager and a single broker for long-term disability insurance. By combining employee benefit approaches, they expect to rack up another $2 million in annual savings.
All told, in 2012, the partners collectively saved about $5 million through GHN initiatives. “That is pretty substantial for us, and I think it’s also just the tip of the iceberg,” says Michael Green, president and CEO of Concord Hospital.
Payer strategies. In addition to lowering their costs, the partners are also positioning themselves to protect or increase market share as new payment models gain more prominence. Last year, GHN and Cigna launched a collaborative accountable care organization (ACO) that covers some 23,000 lives, making it the largest ACO in the state.
Designed to achieve the Institute for Healthcare Improvement’s Triple Aim of improved patient experience, lower total medical costs, and better population health, the ACO allows each of the health systems to maintain its independence even as they work together to coordinate patient care. Each system employs registered nurses who serve as clinical care coordinators assigned to navigate care for patients with chronic conditions, help newly discharged patients avoid readmissions, coach patients to get important health screenings, and remind patients to get prescriptions filled.
Cigna pays GHN for the care coordination services that the health systems provide. The partners are also eligible for a shared-savings distribution based on a medical cost target assigned for the GHN partners as a group.
Data analytics. The Cigna relationship makes use of what may be GHN’s most important initiative: the acquisition of data analytics software to provide centralized business intelligence. This allows GHN to measure—and compare—the cost and quality of the care delivered by the five partner health systems and assess the network’s financial and clinical health risk. By integrating medical, pharmacy, financial, and eligibility data from all five systems, GHN can forecast utilization trends, pinpoint patients at risk for high-cost cases, and analyze physician practice trends to understand how they affect cost and risk.
“None of these hospitals could have done all of this on their own—acquired the analytics, had the numbers of lives to look at significant variations in care, or had the benchmarking capability to understand how they are different,” says Rachel Rowe, GHN executive director. “This allows sharing of best practices. We identify the strategies that are working at one hospital versus the others, and determine how we can all learn from those strategies.”
Improvement initiatives. Thanks to GHN’s data analytics capabilities, the five hospitals detected variation in the use of emergency department (ED) services among asthma patients, prompting the ACO’s first population health management initiative. In the past year, the partners have been working to determine best practices and develop a network-wide care model for asthma patients.
Beginning this spring, a patient with chronic and persistent asthma treated by any of the five partner organizations can expect to receive the same evidence-based care at each facility and in their physician practices. GHN providers have committed to integrating the following guidelines and tools into the care management practices for these patients across the network:
Organized as a joint venture partnership, GHN is working in spite of—or perhaps because of—the fact that the partnership has no chairperson or formal hierarchy. The five CEOs serve as a board of directors, but they make decisions by consensus rather than vote. “What drives our organization are the things that we believe need to be accomplished with regard to our scale and our value strategies,” says Wilhelmsen. “And every time we meet, that’s what we’re talking about: how do we move forward with these initiatives? We are not into any focus on governance and control and all that. That’s what keeps us together.”
And they meet a lot. The five CEOs convene face-to-face for a two-hour session every two weeks—and they have been doing so for more than three years. “We agreed early on that these meetings would be a priority, and that we would show up,” Green says. “We wouldn’t send a representative from our organizations. We would show up.”
Other key leaders convene for their own meetings to figure out how to implement the CEOs’ vision. The chief medical officers from each health system meet at GHN headquarters every two weeks, and so do the CFOs. And eight more leadership groups—CIOs, chief nursing officers, material managers, laboratory directors, and others—convene once a month.
When a GHN initiative requires it, a limited liability corporation (LLC) with its own formal governance is established for that purpose. For example, the medical malpractice insurance company is its own LLC.
GHN operations are managed by Rowe and a growing staff that includes data analysts, a medical director responsible for population health management initiatives, and a director of government affairs and communications. Overhead expenses are prorated based on the relative size of the five partners.
GHN’s successes to date have come pretty easily, Green says, showing that partnerships among like-minded organizations facing the same challenges are well worth pursuing. That said, creating a partnership of independent organizations that compete with one another for patients is no easy task. “You have to constantly work on maintaining and building trust, and you have to learn how to disagree without being disagreeable—because five CEOs are not always going to agree,” he says. “This is a work in progress. We have great aspirations, but it’s not going to come easily.”
Based on their experience, GHN leaders offer several pieces of advice to health systems looking to partner with competitors.
Choose partners based on their track records as partners. Each of the five GHN partners had a working relationship with at least one of the other partners before GHN was formed. For example, Concord Hospital jointly provides cardiac care with one of the health systems and cancer services with another. “We were looking for people with whom we naturally, or over a period of time, had already had an existing business relationship or affinity in terms of how we worked together,” Green says.
Be flexible. Although the GHN partners want to work collaboratively to create the scale that benefits each organization financially, one of the five partners opted not to participate in the professional liability insurance company. “It’s very possible that four organizations want to move forward with an initiative, and one of us says, ‘Not quite yet.’” Wilhelmsen says. “We have to honor that because we have to be respectful of each other.”
Delegate the details. The CEO partners do not get bogged down in implementation challenges. “We say ‘This is what we’re going to do,’ and then we leave it up to somebody else to figure out how to do it,” Green says. “For example, there may be some initiatives for which the costs are split equally, but the basic overhead costs are split on the basis of the size of the organization. The CFOs figured out a formula for how that would work, and everyone readily agreed to that.”
Be mindful of antitrust laws. The GHN partners frequently have a lawyer in their meetings to ensure they avoid any real or perceived antitrust violations.
Be candid. To maintain a healthy relationship for the long term, partners must be able to have difficult conversations. “Obviously, there are going to be sensitive issues—for example, certain things that are someone’s sacred cow,” Wilhelmsen says. “We must have the ability to face each other and discuss things openly, so no one should feel that they can’t raise an issue.”
Focus on the work at hand. GHN leaders set well-defined priorities and strategic objectives each year and revisit them at least every two months—along with a relentless review of performance measures.
To position itself as a value-based network that can assume financial risk for the care of its patients, GHN is measuring quality of care, population wellness, system efficiency, and physician efficiency. “We are driven by what we call our transformation metrics,” Rowe says. “That allows us to understand where to focus our efforts.”
At its core, the GHN partnership is a handshake relationship among five individuals, so any partner could walk away from the relationship. “That’s sort of an ongoing risk that we have,” Green says. “But we mitigate that risk by the more initiatives we consummate and the more we work together and the more economic value that we can demonstrate through the partnership.”
Lola Butcher is a freelance writer and editor based in Missouri.
Interviewed for this article (in order of appearance): Michael B. Green is president and CEO, Concord Hospital, Concord, N.H. Rachel Rowe is executive director, Granite Healthcare Network, Concord, N.H. (email@example.com). Thomas E. Wilhelmsen Jr. is president and CEO, Southern New Hampshire Health System, Nashua, N.H.
Xtend Healthcare: Helping Organizations Optimize Their Revenue Cycle
In this business profile, Mike Morris, president of Xtend Healthcare, discusses the value of partnering with a revenue cycle management vendor that has deep experience in delivering strong ROI.
AvaSure: Using Video Monitoring to Improve Patient Safety and Achieve Cost Efficiencies
Professional Credit: ‘The New Deal’ Approach to Healthcare Collections is Data-Driven and Consumer-Focused
Medxcel Facilities Management: Working Smarter to Make Organizations Safer
The Claro Group: Partnering for Performance Improvement
In this Business Profile, Larry Volkmar, a managing director in the performance improvement
practice at The Claro Group, discusses key strategies for improving
clinical and financial performance.
Deloitte: Taking Data Analytics to the Next Level
In this Business Profile, Christine Santos, chief of strategic business analytics for
Providence Health Services and Chris DeBeer, principal at Deloitte
Consulting LLP explain the value of enterprise data analytics.
PatientMatters: A Patient-Centered Financial Experience
In this Business Profile, Sheila Schweitzer, founder and CEO of PatientMatters, offers insights
on ways hospitals and healthcare systems can address rising patient
6 Patient Revenue Cycle Metrics You Should Be Tracking (and How to Improve Your Results)
Patient financial engagement is more challenging than ever – and more critical. With patient responsibility as a percentage of revenue on the rise, providers have seen their billing-related costs and accounts receivable levels increase. If increasing collection yield and reducing costs are a priority for your organization, the metrics outlined in this presentation will provide the framework you need to understand what’s working and what’s not, in order to guide your overall patient financial engagement initiatives and optimize results.
10 Ways to Reduce Patient Statement Volume (and Reduce Costs)
No two patients are the same. Each has a very personal healthcare experience, and each has distinct financial needs and preferences that have an impact on how, when and if they chose to pay their healthcare bill. It’s no longer effective to apply static billing techniques to solve the complex challenge of collecting balances from patients. The need to tailor financial conversations and payment options to individual needs and preferences is critical. This presentation provides 10 recommendations that will not only help you improve payment performance through a more tailored approach, but take control of rising collection costs.
Reduce Patient Balances Sent to Collection Agencies: Approaching New Problems with New Approaches
This white paper, written by Apex Vice President of Solutions and Services, Carrie Romandine, discusses the importance of patient segmentation and messaging specifically related to the patient revenue cycle. Applying strategic messaging that is tailored to each patient type will not only better educate consumers on payment options specific to their billing needs, but it will maximize the amount collected before sending to collections. Further, targeted messaging should be applied across all points of patient interaction (i.e. point of service, customer service, patient statements) and analyzed regularly for maximized results.
The Future of Online Patient Billing Portals
This white paper, written by Apex President Patrick Maurer, discusses methods to increase patient adoption of online payments. Providers are now seeking ways to incrementally collect more payments due from patients as well as speeding up the rate of collections. This white paper shows why patient-centric approaches to online payment portals are important complements to traditional provider-centric approaches.
Payment Portals Can Improve Self-Pay Collections and Support Meaningful Use
Increased electronic engagement between healthcare providers and patients provides significant opportunities for improving revenue cycle metrics and encouraging patients to access EHRs. This article, written by Apex Founder and CEO Brian Kueppers, explores a number of strategies to create synergy between patient billing, online payment portals and electronic health record (EHR) software to realize a high ROI in speed to payment, patient satisfaction and portal adoption for meaningful use.
Large Health System Drives 10% UP (Patient Payments) and 10% DOWN (Billing-related Costs)
Faced with a rising tide of bad debt, a large Southeastern healthcare system was seeing a sharp decline in net patient revenues. The need to improve collections was dire. By integrating critical tools and processes, the health system was able to increase online payments and improve its financial position. Taking a holistic approach increased overall collection yield by 10% while costs came down because the number of statements sent to patients fell by 10%, which equated to a $1.3M annualized improvement in patient cash over a six-month period. This case study explains how.
ICD-10: Managing Performance
With the ICD10 deadline quickly approaching and daily responsibilities not slowing down, final preparations for October 1 require strategic prioritization and laser focus.
Clarity Drives Collections
Read how Gwinnett Medical Center provides clear connections to financial information, offers multiple payment options for patients, and gives onsite staff the ability to collect payments at multiple points throughout the care process.
Orlando Health Gains Insight into Denials, Reduces A/R Days with RelayAnalytics Acuity
Read how Orlando Health was able to perform deeper dives into claims data to help the health system see claim rejections more quickly–even on the front end–and reduce A/R days.
Revenue Cycle Payment Clarity
To maintain fiscal fitness and boost patient satisfaction and loyalty, healthcare providers need visibility into when and how much they will be paid–by whom–and the ability to better navigate obstacles to payment. They need payment clarity. This whitepaper illuminates this concept that is winning fans at forward-thinking hospitals.
Streamlining the Patient Billing Process
Financial services staff are always looking for ways to improve the verification, billing and collections processes, and Munson Healthcare is no different. Read about how they streamlined the billing process to produce cleaner bills on the front end and helped financial services staff collect more than $1 million in additional upfront annual revenue in one year.
Wallace Thomson Hospital Automates to Maximize Limited Resources
Effective revenue cycle management can be a challenge for any hospital, but for smaller providers it is even tougher. Read how Wallace Thomson identified unreimbursed procedures, streamlined claims management, and improved its ability to determine charity eligibility.
7 Steps for Building and Funding Sustainability Projects
Before launching an energy-efficiency initiative, it’s important to build a solid business case and understand the funding options and potential incentives that are available. Healthcare leaders should consider taking the steps outlined in the whitepaper to ease the process of gaining approval, piloting, implementing, and supporting sustainability projects. You will find that investing in sustainability and energy efficiency helps hospitals add cash to their bottom line. Discover how hospitals and health systems have various options for funding energy-efficient and renewable-energy initiatives, depending on their current financial structure and strategy.
Key Capital Considerations for Mergers and Acquisitions
Health care is a dynamic mergers and acquisitions market with numerous hospitals and health systems contemplating or pursuing formal arrangements with other entities. These relationships often pose a strategic benefit, such as enhancing competencies across the continuum, facilitating economies of scale, or giving the participants a competitive advantage in a crowded market. Underpinning any profitable acquisition is a robust capital planning strategy that ensures an organization reserves sufficient funds and efficiently onboards partners that advance the enterprise mission and values.
Key Capital Considerations for Mergers and Acquisitions
The success of healthcare mergers, acquisitions, and other affiliations is predicated in part on available capital, and the need for and sources of funding are considerations present throughout the partnering process, from choosing a partner to evaluating an arrangement’s capital needs to selecting an integration model to finding the right money source to finance the deal. This whitepaper offers several strategies that health system leaders have used to assess and manage capital needs for their growing networks.
Trend Watch: Providers adapt as value-based care moves from hype to reality
Announcements from several commercial payers and the Centers for Medicare and Medicaid Services (CMS) early in 2015 around increased efforts to form value-based contracts with providers seemed to point to an impending rise in risk-based contracting. Rather than wait for disruption from the outside in, health care providers are now making inroads on collaborating with payers on various risk-based contracting models to increase the value of health care from within.
Yuma Regional Medical Center case study
Yuma Regional Medical Center (YRMC) is a not-for-profit hospital serving a population of roughly 200,000 in Yuma and the surrounding communities.
Before becoming a ZirMed client, Yuma was attempting to manually monitor hundreds of thousands of charges which led to significant charge capture leakage. Learn how Yuma & ZirMed worked together to address underlying collections issues at the front end, thus increasing Yuma’s overall bottom line.
Reforming with a New 50-Bed Acute Care Facility
Kindred Hospital Rehabilitation Services works with partners to audit the market and the facility’s role in that market to identify opportunities for improvement. This approach leads to successes; Kindred’s clinical rehab and management expertise complements our partners’ strengths. Every facility and challenge is unique, and requires a full objective analysis.
5-Minute Briefing on Revenue Integrity Through HIM WhitePaper Hospitals FS
As the critical link between patient care and reimbursement, health information enables more complete and accurate revenue capture. This 5-Minute White Paper Briefing shares how to achieve cost-effective revenue integrity by your optimizing HIM systems.
5-Minute Briefing on Accelerating Cash Flow Through HIM WhitePaper Hospitals FS
Speedier cash flow starts with better CDI and coding. This 5-Minute White Paper Briefing explains how providers can improve vital measures of technical and business performance to accelerate cash flow.
5-Minute Briefing on Reducing the Cost of RCM WhitePaper Hospitals FS
Qualified coders are getting harder to come by, and even the most seasoned professional can struggle with the complexity of ICD-10. This 5-Minute White Paper Briefing explains how partnerships can help improve coding and other key RCM operations potentially at a cost savings.
Providers Focus Too Much On Revenue Cycle Management
The point of managing your revenue cycle isn’t just to improve revenue and cash flow. It’s to do those things effectively by consistently following best practices— while spending as little time, money, and energy on them as possible.
Lucille Packard Children’s Hospital Stanford Case Study
How Lucile Packard Children’s Hospital Stanford increased payments received within 45 days by 20% and reduced paper submission claims by 70% by using ZirMed solutions.
Using Predictive Modeling To Detect Meaningful Correlations Across Claims Denials Data
The reasons claims are denied are so varied that managing denials can feel like chasing a thousand different tails. This situation is not surprising given that a hypothetical denial rate of just 5 percent translates to tens of thousands of denied claims per year for large hospitals—where real‐world denial rates often range from 12 to 22 percent. Read about how predictive modeling can detect meaningful correlations across claims denials data.
ZOLL and Emergency Mobile Health Care Case Study
Emergency Mobile Health Care (EMHC) was founded to be and remains an exclusively locally owned and operated emergency medical service organization; today EMHC serves a population of more than a million people in and around Memphis, answering 75,000 calls each year.
Maximizing Medicare Reimbursements White Paper
Since the Physician Quality Reporting Initiative (PQRI) introduction, CMS has paid more than $100 million in bonus payments to participants. However, these bonuses ended in 2015; providers who successfully meet the reporting requirements in 2016 will avoid the 2% negative payment adjustment in 2018, so now is the time to act! Included in this whitepaper are implications of increasing patient responsibility, collections best practices, and collections and internal control solutions.
Denials Deconstructed: Getting Your Claims Paid
Getting paid what your physician deserves—that’s the goal of every biller. Yet even for the best billers, achieving that success can be elusive when denials stand in the way of success, presenting challenges at every turn. Denials aren’t going away, but you can learn techniques to manage and even prevent them.Join practice management expert Elizabeth W. Woodcock, MBA, FACMPE, CPC, to: Discover methods to translate denial data into business intelligence to improve your bottom line, determine staff productivity benchmarks for billers, and recognize common mistakes in denial management.
Automation and Operational Improvement Drive Sustainable Results
Physician practices must improve organizational efficiency to compete in this era of reduced reimbursement and escalating administrative costs.
Revenue Cycle Management Resolves Migration Implementation Issues
Many healthcare organizations are pursuing next-generation health information systems solutions. Learn more about Navigant's work with University of Michigan Health System.
Partnering For Success – Provider Achieves Strength in Stability
The proper implementation of healthcare information technology systems is crucial to an organization’s financial health.
Building a Clinically-Integrated Network
As value-based payment models evolve, providers are challenged to maintain superior clinical outcomes while controlling costs.
Winning in the Post-Acute Marketplace
Read more about factors contributing to the changes in the post-acute marketplace and what it means for manufacturers, physicians, clinicians, patients, and post-acute facilities as they anticipate the transition to the second curve.
Building A Common Vision with Employed Physicians
HSG helped the physicians and executives of St. Claire Regional in Morehead, Kentucky, define their shared vision for how the group would evolve over the next decade. As well as, develop the strategic and operational priorities which refocused and accelerated the group’s evolution.
Practice Performance Improvement
The client was a nine-hospital health system with 14 clinics serving communities in a multi-state market with very limited access to care, poor economic conditions, high unemployment, and a heavy Medicare/Medicaid/uninsured payer mix. In most of these communities, the system was the sole source of care.
Though the clinics were of substantial size (they employed 98 physicians) and comprised of multiple specialists, the physicians functioned as individuals and the practices lacked any real group culture.
Clinical Integration Without Spending a Fortune
Clinical integration can be expensive, but it doesn’t have to be, as this four-step road map for developing a CIN proves. Does it have to cost millions to initiate a clinical integration strategy?
Contrary to popular belief, we have clients who have generated substantial shared savings and a significant ROI over time, without massive investments. Yes, some financial capital is required for resources the CIN providers can’t bring to the table themselves. But the size of that investment can be miniscule relative to the value it produces: improved outcomes and documentation for payers.
Adding Value to Physician Compensation
Today’s concerns about physician compensation are the result of the changing healthcare environment. The transition to value is slow, but finally becoming a reality. Proactive hospitals want to ensure that provider incentives are properly aligned with ever-increasing value-based demands.
This report focuses on the three big questions HSG receives about adding value to physician compensation; Why are organizations redesigning their provider compensation plans? What elements and parameters must be part of successful compensation plans? How are organizations implementing compensation changes?
Effective Revenue Cycle Management in Your Network
Revenue Cycle Management has become an even more complex issue with declining reimbursements, implementation of Electronic Health Records, evolving local carrier determinations (LCD), and payer credentialing [The emphasis on healthcare fraud, abuse and compliance has increased the importance of accuracy of data reporting and claims filing).
The efficiency of a medical practice’s billing operations has critical impact on the financial performance. In many cases, patient billings are the primary revenue source that pays staff salaries, provider compensation and overhead operating cost. Inefficiencies or inaccurate billing will contribute to operating losses.
Succeeding in Value-Based Care
This publication identifies and outlines the necessary characteristics of a fully-functioning clinically integrated network (CIN). What it doesn’t do is detail how hospitals and providers can participate in the value-based care environment during the development process.
One common misconception is that the CIN can’t do anything significant until it has obtained the FTC’s “clinically integrated” stamp of approval. While the network must satisfy the FTC’s definition of clinical integration before single signature contracting for FFS rates and contracts can legally start, hospitals and providers can enjoy three key benefits during the development process.
Therapy: Benefits at All Levels of Care
Nearly half of all Medicare beneficiaries treated in the hospital will need post-acute care services after discharge. For these patients, a stay in an inpatient rehabilitation facility, skilled nursing facility or other post-acute care setting comes between hospital and home.
Does Your Budgeting Process Lack Accountability?
With the proper process, tools, and feedback mechanisms in place, budgeting can be a valuable exercise for organizations while helping hold organizational leaders accountable. Having a proper monthly variance review process is one of the most critical factors in creating a more efficient and accurate budget. Monthly variance reporting puts parameters around what is to be expected during the upcoming budget entry process.
Cost Accounting: the Key to Cost Management and Profitability
Managing the cost of patient care is the top strategic priority of most hospital CFOs today. As healthcare shifts to more data-driven decision making, having clear visibility into key volume, cost and profitability measures across clinical service lines is becoming increasingly important for both long-range and tactical planning activities. In turn, the cost accounting function in healthcare provider organizations is becoming an increasingly important and strategic function. This whitepaper includes five strategies for efficient and accurate cost accounting and service line analytics and keys to overcoming the associated challenges.