The Healthcare environment in the United States is evolving rapidly due to the pressures to reduce costs. The Affordable Card Act (ACA) has provisions that expand coverage via Health Exchanges as well as expansions of the Medicaid program. Due to budget pressures, states are migrating from State run Medicaid to Medicaid being managed by Managed Health Care Plans. Coventry has a significant presence in the Managed Medicaid market. Aetna significantly increases their presence in Managed Medicaid and lower priced insurance plan options with the recently announced acquisition of Coventry. Given the migration of new patients to lower priced insurance plans (via the future Health Exchanges) as well as expanded Medicaid coverage, this is a potential growth opportunity for Aetna. Appears that Aetna believes in this potential opportunity due to the premium they paid for Coventry (over $5.0B).
For your Pediatric practice, it is critical to monitor the reimbursement trends by plan as these changes in the Healthcare system continue to occur. Pediatric offices usually provide one of the lowest costs of Healthcare delivery from the perspective of plans and employers. Leveraging the facilities of a Pediatric Office is in alignment with the interest of the Healthcare system by promoting wellness versus ‘sick care’. Also, services in pediatric offices are more cost effective than in hospital settings. Small Pediatric Practices can effectively manage this complex environment by adding new patients, providing quality care, and by implementing strong management of the practice revenue cycle. If a practice is unable to grow patients as well as manage their Pediatric Practice Revenue cycle effectively, they will eventually dissolve or merge with a Hospital System or large Medical Group.
Health insurers identify how to save money by lowering reimbursements – unfortunately, many use the ‘squeaky wheel’ type of rewards/evaluation. For example, a Health Insurer will not increase rates on all providers on their ‘independent products’ while negotiating high single digit rates with the Hospital System that uses their size as leverage. If the small Pediatric office does not have solid IT systems that allows them to evaluate their reimbursements, they might be underpaid compared to the Hospital System located in the same area. If your Pediatric practice provides high-quality and consistent medical care, the practice show be rewarded on the care provided. The Health Insurance companies prefer that practices are managed like the average Pediatric practice country versus Pediatric practices that consistently achieve collection rates above 99% of the contract amount. This is a good time to benchmark the collection rate and check the controls and systems in place that optimize not only the collection rate but also the Accounts Receivable (AR) days. Through good benchmarking and management of the revenue cycle, your practice can be confident on how to manage the changes in the Healthcare market like the Aetna acquisition of Coventry.
best EHR
Is there a Potential Impact on Pediatric Practice Revenue due to Aetna Acquisition of Coventry?
How Aligned are your consultants to the Goals of Your Pediatric Practice?
A Pediatric practice needs to successfully work with both internal and external stakeholders to be successful. These stakeholders include employees and external vendors/companies and sometimes, consultants. There can be misalignment of the goals of each of these stakeholders with the goals of your Pediatric Practice. There are a number of questions to ask a consultant to insure they represent your best interests.
Some of these questions could include:
-Is the consultant recommending a product or service due to an alliance with their firm or due to quality of the product for your practice? For instance, a company that sells servers will have a bias to recommend server E.H.R. systems due to their revenue being made based on providing advice and maintaining servers. If a consultant speaks at an event sponsored by a Vendor, this might indicate that there is a bias for this vendor. A question to ask: Is the speaking engagement with a particular vendor due to the vendor providing them customers that they can charge their consultant service and do they speak equally at events for all vendors in the same state (not just the ones that send them practices)?
-Having a consultant choose an E.H.R. service, could cause a Pediatric office to obtain an ‘old’ technology product or a product that does not appropriately balance the revenue/cost needs of the practice with the desire for a consultant to provide a service. Some consultants might not have the technical expertise to make the ‘right’ decision for your Pediatric Practice. Recommend asking any “E.H.R. consultant” how long they have managed a practice as well as their experiences with optimizing revenue for a practice (there are many with great experiences and unfortunately some with none to minimal experience). Equal time should be spent discussing the revenue cycle/practice management as well as clinical aspects of the E.H.R.. Consulting advice should look to optimize revenue, minimize burden, cost and start-up time. The practice is ‘on the hook’ for long-term operation of a system/process and the receiving end of decisions made regarding a system.
-Does this consultant make more or less money if the practice identifies a solution that requires minimal work on their part? Why would a consultant that charges by the hour (whether paid for by the practice or the government) seek a system that reduces billable hours? The long-term operational burdens are the responsibilities of the practice not a consultant.
Exceptional consultants with a solid history should be able to balance the needs of their clients with the need to optimize their own billable hours. Great consultants know and understand the revenue cycle and provide hints on how to reduce administrative burdens of Pediatric Practices. With all the conflicting priorities and needs of a Pediatric Practice, it is important for a practice owner to select the ‘best’ consultants/advisors for their particular needs.
