New requirements for value, meaningful use and benefits coverage are pushing providers to improve information technology systems, revamp business strategies and consider organizational partnerships, according to two healthcare leaders in healthcare finance and IT.
Infor Chief Medical Information Officer Dr. Barry Chaiken said changes in the healthcare business model are incentivizing providers to move toward value-based care and risk sharing. This involves more synergy among all facets of a health center, he noted. As someone who helps develop ways of improving providers’ clinical and financial performance through information technology, Chaiken said hospitals need enhanced communication among all their sectors to eliminate silos.
“The new world is looking at everything together and how they impact each other,” he said. “Today, it’s not done that way.”
With millions of previously uninsured individuals now paying for their coverage, Chaiken said the federal health reform law is ushering in a new wave of consumerism.
“Money is coming out of patients’ pockets, rather than payers,” he said. “Consumerism is really starting to take hold because patients are buying everything now.”
Demand for lower prices means hospitals must find ways to reduce additional costs, like those directed toward billing and administration. Mergers have become an increasingly common solution the past decade, even between non-profit and for-profit health centers, according to Michael Burger, Fitch Ratings director of public finance healthcare. But, Burger said the health reform law is ramping up those partnerships to an even greater extent.
When hospitals and clinics are unable to secure funding from investors and struggle to keep up with competitors, these providers often times join larger, more financially viable health systems, Burger said. He added that implementing an electronic health records system is especially difficult for smaller, independent healthcare organizations.
“Smaller providers have less access to capital, which is one reason why they merge with a larger provider,” Burger said. “Even before [the Affordable Care Act], you’ve always had mergers and consolidation within the industry. It’s just more pronounced now.”