A new study published in Modern Healthcare found that medical waste accounts for roughly one quarter of all U.S. healthcare spending accounting for approximately $760-$935 billion annually. This is precisely why the government is focused on value-based care, transparency, and alternative payment models. The report highlights the data the government has been using to drive their quality and value initiatives and changes to improve accountability. Becker’s reported last week that 2,583 hospitals will receive cuts from 0.01 – 3% and 56 hospitals are facing the maximum Medicare readmission penalties for fiscal year 2020. (Readmission Penalties)
The waste study was divided into six categories and not surprising the two most significant categories were: administrative complexity and pricing failure. Cost savings mechanisms will be required not optional. The oncology service line has a very large spend, which makes it visible to CMS and a good place to deploy savings mechanisms and programs. The goal is to ensure quality while controlling cost. This is the thought behind the proposed Radiation Oncology Alternative Payment Model (RO-APM 5527-P).
While the government doesn’t anticipate zero waste, they do expect to see significant improvement. It is feasible and will be required. In oncology the largest form of waste observed is the prior authorization process which is falls under the administrative complexity category. Former CMS Administrator Dr. Don Berwick, stated:
“The solution to healthcare waste will need to be a political one. People must mobilize to say, “ ’It’s enough. We’re not going to put up with this kind of administrative waste,” he said. “ ’We’re not going to put up with this obscene pricing. It’s time to stop.’ I don’t know without that kind of political force, how these circumstances can be changed.”
Transparency will drive accountability from payers and providers. The data is key for providers and payers to create models that will not inhibit timely care, yet still provide quality care and value for the patients. Operations and workflow will need to be reviewed and analyzed to help practices and service lines navigate the requirement to reduce waste using data analytics, technology, and process and improvement methodologies.
At Legion Healthcare Partners we are using our software, data analytics, and expertise to help oncology practices be prepared for the pending changes, models and initiatives to eliminate waste. Our knowledge of all levels and aspects of oncology allow us to deploy solutions with and impact on quality, finance and efficiency and operations.
If you want to learn more about operational efficiency and upcoming changes join Legion Healthcare Providers at our open forum symposium in Dallas, Tx November 7th and 8th. The Oncology Think Tank will allow discussions on waste, operational efficiency, outcomes and finances plus much more. The Oncology Think Tank will unpack and discuss issues such as operations, workforce optimization, costing, billing and coding, the APM, effective transitional leadership, mergers and acquisitions, employment models, viability plus much more.
The team at Legion Healthcare Partners is committed to helping you and your team ensure financial viability and quality patient care.