Preparing for Future Payment Reform
Federal payment reform appears poised to emerge, and once it does, providers may need to change quickly. To succeed under payment reform, providers can begin today to build their competencies in three key areas:
Integration: The ultimate success of payment reform will depend heavily on collaboration among stakeholders across the care continuum, especially between physicians and hospitals. While all stakeholders are making efforts to improve the quality of their own processes, transformation will require hospitals, physicians, and other providers from across the care continuum to work together to bring the needed change.
Risk Management: Payment reform may shift portions or all of the financial risks among industry stakeholders, making the ability to manage these risks essential for success under payment reform. The two most important changes for providers will involve the financial risk of managing a population’s health and the risk associated with quality and efficiency.
Pricing. Establishing an accurate price in relationship to cost has been hard enough under traditional fee-for-service payment. Under payment reform, providers will need to set prices for brand new bundles of services at levels that allow them to recoup costs (both direct and indirect), include some measure of the risk involved in providing the service, and incorporate a margin that allows the provider to make necessary capital reinvestments and fund programs central to the mission of the organization.
To
develop these competencies, provider organizations will need to
be able to access accurate cost information, to base decisions
on real-time clinical and financial information, to understand
their competitive markets and the populations they cover, and to
educate and empower their entire organizations to seize the
opportunities of change.