Financial Sustainability Report: March 2020

The March issue of the Financial Sustainability Report, sponsored by Kaufman Hall, provides insights and guidance for healthcare finance leaders ranging from accessing untapped opportunities for cost savings to using risk stratification to improve the organization’s position in negotiating risk contracts.

Cost reduction strategies

Are hospitals culling all the savings they can from purchased services?
By Jan van Londen 
The very real possibility of being able to reduce purchased services spend by 10% to 15% offers hospitals and health systems a compelling reason to pursue such an effort. 

Total cost of care

How providers can avoid being at a disadvantage when negotiating risk contracts
By Daniel J. Marino and George Mayzell, MD, MBA, FACHE
Risk stratification is an effective short-term strategy for providers seeking to negotiate risk contracts with payers from a position of strength as they pursue the long-term strategy of developing cost accounting systems that can help them understand their total costs of care.

Employer-Sponsored Insurance

Walmart’s moves to ‘curated networks’ focuses on improved quality and downstream savings
By Richard Daly 
Walmart plans a ground-breaking test of narrow networks for its employee health plan that aims to elicit physician support of its metrics around quality and outcomes.

Care Management

Care management and reduced LOS: How to connect the dots
From our sponsor, Kaufman Hall
By Lance Robinson
Hospital leaders have often focused their efforts to reduce costs on optimizing labor, supplies and facilities. But emerging care management strategies can help hospitals significantly reduce patients’ length of stay (LOS), saving millions of dollars annuallyml

Consumerism and Margin Management

Why a focus on margin management is critical in a consumer-centric healthcare market
By Eric C. Reese, PhD
Providers that remain focused on service-by-service approach to care delivery will find themselves out of step with today’s consumer-focused healthcare system. 

Hospital pricing

New report: Patients and insurance companies in the United States pay higher prices for almost everything healthcare-related
By Chad Mulvany, FHFMA
HFMA’s Chad Mulvany says to expect more research reports calling into question hospital pricing (both within and across geographies and comparing HOPD pricing for the same services provided in the freestanding setting) in 2020.

Strategic Planning

Why health systems need a hybrid strategy and ambidextrous leadership to ensure financial sustainability
By David G. Anderson, PhD, And Steve Weylandt, MHA
In today’s complex healthcare environment, health systems require an effective hybrid strategy that accounts for the fundamental differences among the various markets in which they compete, including inpatient, population health and emerging markets.