- Healthcare organizations have financial and moral reasons to shift their business models to focus on the cost effectiveness of health.
- Organizations that move from fee-for-service to a more comprehensive approach can realize a significant ROI if they adapt their mindset.
- The link between kindness and good health should not be overlooked, according to a keynote presentation by psychiatrist and Columbia University professor Kelli Harding.
DENVER — During his annual industry update, HFMA President and CEO Joseph J. Fifer, FHFMA, CPA, said it’s past time for stakeholders to turn their attention to optimizing the cost effectiveness of health (CEoH) rather than simply focusing on traditional healthcare operations.
Choosing to meet the challenge “is choosing to stay true to the missions of most of our organizations: to help patients, to improve lives,” Fifer said Monday at HFMA's Annual Conference.
A skewed financial structure
The fee-for-service payment system is blocking the transition to CEoH. The system is misaligned with the goal of supporting health while lowering costs as defined on a per member per month basis.
“If you get paid by the component, it sure is asking a lot to pay attention to the complete final product,” Fifer said.
“Consumers, on the other hand, are very much aware of the purchase costs of healthcare encounters over time — at least the portion that they're paying out of pocket. And they're interested in the outcome, not just for the encounter, but [for] their overall health experience.”
“So what we have here obviously is a bit of disconnect to say the least, and it seems complicated and sometimes it's overwhelming.”
The disconnect is unsustainable, with government and commercial payers progressively moving to payment systems that incorporate risk. In addition, “Data about healthcare and health are being gathered and analyzed by big, well-capitalized entities,” Fifer said. “Just think about that for a second. Do you think that just might change how healthcare is purchased?”