HFMA Offers Recommendations to Senate to Reduce Total Cost of Care while Improving Patient Outcomes
On behalf of the Healthcare Financial Management Association’s 38,000 members, I would like to commend you and the members of the Senate Committee on Health, Education, Labor & Pensions for your work to-date in exploring solutions that will reduce the total cost of care by reducing unnecessary utilization, increasing transparency, eliminating unnecessary administrative burdens (administrative simplification), and leveraging innovation.
HFMA is the nation's leading membership organization for healthcare financial management professionals. As an organization, we are committed to helping our members improve the management of and compliance with the numerous rules and regulations that govern the industry. Our members are widely diverse, employed by hospitals, integrated delivery systems, managed care organizations, ambulatory and long-term care facilities, physician practices, accounting and consulting firms, and insurance companies. Members' positions include chief executive officer, chief financial officer, controller, patient accounts manager, accountant, and consultant. Like you, our members are deeply concerned about the unsustainable growth in the cost of healthcare goods and services.
While the federal government has aggressively led efforts to reduce the total cost of care and improve outcomes for Medicare and Medicaid beneficiaries, we believe there is more that can be done. Specifically, in addition to public programs, there is a tremendous opportunity for the federal government to drive innovation in the private sector through the Federal Employees Health Benefit Plan (FEHBP). The federal government is the largest single employer in the country. As such, the FEHBP spends $40 billion covering approximately 8.2 million federal employees, retirees, and their dependents. across all fifty states and U.S. Territories. Given the scale of the FEHBP, we believe that changes implemented to it will spill over into other private market health plans (e.g. ERISA plans and those offered in the individual and small group markets). Therefore, HFMA’s members recommend Congress require FEHBP participating health plans and providers use alternative payment models, price transparency tools, and innovative benefit designs. We also strongly recommend that Congress require FEHBP participating plans undertake targeted efforts to simplify administrative processes. In response to these requirements, we believe health plans and providers would make investments that they would deploy to other commercially insured populations (both employer and individual market) to amortize these costs over a larger population.
Therefore, HFMA would like to offer specific recommendations, included in Attachment I to reduce the total cost of care while improving patient outcomes. These recommendations are informed by our members’ experiences as financial stewards for health plans, health systems, and physician practices, and by our extensive cross-sector research on healthcare value and the impact of value-based payment on total cost of care as well as our consumerism initiatives.