For many years, hospitals have relied on a fee-for-service based revenue system to generate income. With recent advancements in healthcare, many hospitals are now being required to transition to a value-based reimbursement revenue system to remain competitive in the market.
A value-based reimbursement system is designed to incentivize a reduction in the cost of services associated with treating a specific patient population. At the end of the year, hospitals receive a portion of the money they were able to save, making a value-based reimbursement system beneficial over time.
Transitioning to this type of fee structure can be difficult, but here are three key things a hospital can do to ensure a smooth transition in the future.
1. Learn to effectively manage shared savings programs to maximize end-of-year payouts.
There are many different types of shared savings programs that are willing to partner with hospitals to create a value-based reimbursement contract. The most standardized of these programs is the Medicare Shared Savings Program.
If hospitals want to receive payment for their attention to the value of care given to Medicare patients, it's essential that a dedicated employee understands how to track the quality measures (30-day readmission rates, 90-day readmission rates, etc.) set forth by Medicare.
2. Reduce operating costs without sacrificing quality.
Hospitals often find it difficult to adjust to the measures required to meet minimum payment standards under a value-based reimbursement contract. Until the transition to this new revenue structure is complete, it can be helpful to lower operating costs to prevent significant financial losses.
Implementing cost-saving measures like standardized layouts in all medical supply rooms to promote efficiency and tracking unused medical items that get discarded to help reduce waste can be beneficial in lowering operating costs.
3. Attract more patients.
The more patients a hospital is able to treat, the more money they will be eligible to receive at the end of the year through a value-based reimbursement contract. As a hospital transition from a fee-for-service revenue system to one that is based on the quality of care received by patients, patients will be more likely to utilize that hospital's services over another.
The more closely a hospital aligns its practices with the measures outlined in a value-based reimbursement contract, the more patients it will be able to attract during the transitional phase.
Healthcare contracts play a vital role in allowing hospitals to generate revenue. By switching to a value-based reimbursement contract, a hospital can increase its potential revenue over time. For more information, contact HEALTHCENTS or a similar company.Share