According to an article by Rene Letourneau, for HealthLeaders Media, December 1, 2014, where he interviewed a number of CFOs, there are 5 Big Hospital CFO Concerns for 2015. Now almost in the middle of 2015, do you agree with his prognostications?
- Declining Utilization
As hospitals move towards a value-based system, the quality of care improves and so too, do patient outcomes. With that success comes reduced patient volume (and revenue) as inpatient care declines. All that can have a negative impact on the hospital revenue cycle.
Medicaid expansion offers only short term help as more patients coming from the previously uninsured low-income population. “Bigger forces will continue to drive down utilization.”
Better ways of delivering care must be found that do not impact the revenue stream or the quality of care in a negative way. Balance has to be found.
- High Deductible Health Plans
As patients are now faced with higher deductibles, it is expected that collections in 2015 will increase unless CFOs “rethink internal processes in order to protect revenue.”
Through outreach and early and frequent patient engagement, CFOs are considering moving the revenue cycle process upfront to forestall collection issues at the back end. Solutions considered include educating patients about their financial obligation early and offering options to facilitate payment either through upfront payment or financial assistance.
- Downgraded Credit Ratings
“As we move away from fee-for-service reimbursements, the investments we have to make are not capital investments. They are operating investments that cannot be capitalized or amortized.”
Equipment and facilities can be capitalized but “integrating our physicians and becoming a clinically integrated network” cannot be capitalized.
- Medicaid Expansion Woes
“Many health systems in states that are not expanding Medicaid are facing real financial peril due to significant cuts to the Disproportionate Share Hospital program, which makes federal payments to qualifying hospitals that serve a large number of Medicaid and uninsured individuals.”
Even for hospitals in states that have expanded Medicaid there is risk. “As we all know, when the economy takes a downturn, one of the first places states look to cut is Medicaid so having more Medicaid beneficiaries means having more risk.”
- Making EHRs Pay Off with Actionable Action
“Once an EHR is up and running, the key to maximizing it from the financial perspective is to extract and analyze the data in a way that leads to standardization of care and a reduction in the use and duplication of expensive clinical resources.”
Read the entire article written by Rene Letourneau, for HealthLeaders Media , December 1, 2014.