Editor's note: This blog post is written by Alex Tolbert, founder of Bernard Health.
Our healthcare system is broken partly because consumers don't
know what anything costs. As patients become more proactive in making informed
healthcare decisions, we all agree this should be fixed. But why is it so hard?
Achieving price transparency in healthcare is difficult because healthcare
business models rely heavily on a lack of transparency.
Insurers, hospitals and providers want a better healthcare
system as much as anyone, but can't afford to inflict damage on their businesses
by making prices transparent overnight.
To better understand how transparency affects healthcare, let's
take a look at the business models for insurers and hospitals.
Insurer Business Model
If prices were completely transparent, then insurance companies
who had negotiated the lowest prices would begin to lose their primary
advantage. This is because that pricing information would give medical
providers and other insurance companies more power when negotiating and
competing with them.
An insurer's business model can be boiled down to this:
- Negotiate discounted prices with providers.
- Insure people, collect premiums.
- Pay claims to providers at discounted prices.
- Keep the difference.
Since that is the business, here is how you win financially:
- Negotiate the lowest prices with
- Offer the lowest premiums so you can attract
the most insured people.
- Enjoy the virtuous cycle that ensues.
What virtuous cycle?
The more people you insure, the lower the prices you can get
from providers. If you can get the lowest prices, you can offer the lowest
premiums. Offering the lowest premiums will win you the most insured people,
and so you can continue to negotiate the lowest prices from providers. And so
Hospital System Business
If prices were completely transparent, then it would be
difficult for the hospitals to justify the high prices they charge for things
available elsewhere for a fraction of the price. In other words, if everyone
knew that "Procedure ABC" costs $3,800 at the hospital and $600 for the same
quality at a standalone facility next door, the hospital would lose a lot of
The typical hospital system business model can be boiled down to
- Negotiate prices with insurers to be
- Get paid at those prices on patient claims
submitted to insurers.
- Pay your doctors, "midlevel" providers, nurses
and facility/equipment costs.
- Keep the difference.
Since this is the business, here is how you win financially:
- Negotiate the highest prices with insurers.
- See as many patients as possible.
- Submit as many claims as possible for each
It's a lot easier to do more tests/procedures per patient than
to attract more patients. As such, your contracted prices for tests and
procedures are really important.
Fortunately, as a hospital system, your size gives you leverage
when negotiating with insurers. The insurers need you in their network more
than they need a given imaging center. As a result, you're able to negotiate prices that are a lot higher and still be in-network.
Fueling the Movement Toward
Creating a better healthcare system starts with price
transparency. The growth of health savings accounts and transparency start-ups,
like Healthcare Blue Book and Change:Healthcare have fueled the movement toward
In addition, insurers and hospitals are working hard to provide
transparency. To offset the damage transparency will inflict on their business
models, they're working to develop other competitive advantages.
As consumers continue to share the burden of ever-increasing
healthcare costs, it's only fair that they be armed with the information needed
to make informed decisions about their healthcare. This transparency will lead
to a better-functioning and lower-cost system with happier providers and
Editor's note: This article was posted with permission from its author, Christine Gondos, Igloo Software. She can be reached at firstname.lastname@example.org.
The fastpaced healthcare industry is continuously evolving --
whether it be newly released studies, new best practices or new techniques, the
healthcare community thrives off of innovation.
annual conferences provide the opportunity for healthcare professionals to
connect, the majority of professionals rely on email to exchange new findings.
Healthcare professionals have recently placed an importance on social media
networks (such as Twitter) as an additional outlet to exchange ideas. While
social media provides an opportunity for medical professionals to connect and
discuss best practices, this ultimately becomes problematic due to the
confidential nature of the discussions.
how can healthcare professionals network, engage in conversations about practice and
share knowledge while maintaining confidentiality and ethical standards?
Software's Senior Vice President of Marketing & Operations, Andrew Dixon
recently presented at the CIO Healthcare Summit where he discussed "How Healthcare Organizations are Moving from Social Media Marketing to Social
Business Strategy." Instead of connecting on public social networks, more and
more healthcare organizations are creating a social business strategy so they
can collaborate on their own private network.
Secure enterprise social platform
organizations like Igloo unite healthcare professionals, practitioners and
patients so they can collaborate on ideas and keep information in one area. After a patient leaves the office, you no longer need to feel that
sense of ambiguity questioning if you remembered everything he or she said. No
longer does a conversation need to live in the room you had it; nor your email
inbox, nor your notebook.
Enterprise social software erases ambiguity and allows information to be
accessible yet secure. Here are four use cases of how enterprise
social software enables healthcare professionals to stay connected outside the office.
- Kimberly-Clark Clinical Solutions
is a health division of a large consumer goods company that has a very large
health product portfolio including medical devices & infection prevention.
To facilitate research, they launched a social extranet solution to act as a
product evaluation center for open innovation & customer engagement.
- Ontario Health Quality Council,
an independent provincial body for patient care, coordinates a myriad of
stakeholders in a member portal to report on the health system's effectiveness
and opportunities for process improvement.
Are your patients curious about learning more
information about what you said in a recent appointment? While you may question the
validity of checking Wikipedia or the intimidating results Google reports back,
patients often feel alone when they leave their provider's appointment.
Healthcare organizations realize this and have bridged the gap by offering
patients a portal where they can connect.
National Medical Center provides patients with a secure, private virtual
place where they can ask questions, find answers and share experiences around a
specific health condition. Their Emergency Medical Services for Children
Program (EMSC) National Resource Center also provides a secure portal for
grantees to interact and share information with each other in support of EMSC's
national child advocacy programs.
Want to bring together key stakeholders within a healthcare
association to work together and improve healthcare delivery? A
conference may be a great way to get everyone together, but how will you
Enterprise social software platforms provide practitioners a
specific work area where they can collaborate on documents and share best
Drug Information Association uses a social
extranet to connect their 18,000 members in the biopharmaceutical industry for
online learning, collaboration and managing their communities of practice.
Since adopting this new form of technology, their collaboration tools are now
streamlined and this area facilitates knowledge exchange and relationship
building in a private member portal for their 32 special interest groups.
American Academy of Family Physicians (AAFP),
representing more than 100,000 family
physicians and medical students nationwide, improved their collaboration since
launching an online community for peer networking, information sharing and
practice transformation. Members have access to online seminars, practice
tools and the "Ask An Expert" area. Known as Delta Exchange, the award-winning online
network connects physicians, clinical staff, office staff and primary
care-focused residency programs committed to the Patient Centered Medical Home.
wholly-owned subsidiary of the American Academy of Family Physicians (AAFP)
also capitalized on the benefits of social collaboration. In an effort to
improve patient care and assist primary care physicians with medical practice
redesign, over 500 practices and more than 5,000 medical professionals across
the country connect and collaborate using Igloo Software.
External facing communities (extranets) have gained
tremendous momentum for healthcare organizations. Effective collaboration,
improved knowledge sharing, and accessibility anywhere - it is no wonder that
more and more healthcare organizations like The College of Family Physicians of Canada,
are adopting social intranets to collaborate inside their organization.
Bye bye filing cabinets and shared folders.
The organizations mentioned
above stay organized with hierarchical storage of documents with unlimited folders, inline preview
and full version control. Organizations and associations in the
healthcare industry now have the power to stay connected to other healthcare
professionals, practitioners and patients in a secure environment where
confidential information is safe.
For more information, visit http://www.igloosoftware.com/blogs/inside-igloo/continuingtheconversationoutsidethedoctorsoffice4waystostayconnected
Editor's note: This blog is written by Anthony J. Hall, RN, BSN,
behavioral health charge nurse at Atlanta Medical Center.
The Affordable Care Act (ACA) means major changes in the way
Americans view health issues and treatment options. While there is increased
optimism building around the plan's effect on patient care, healthcare
providers will bear the burden of the plan's negative impacts, such as a
shortage of primary care providers. Though the full impact on the medical
profession has been hard to gauge, providers can be primed for some positive
adjustments as a result of ACA.
It's easy to see the immediate benefits of the ACA for healthcare
recipients - many more families will be able to schedule regular visits to a
general practitioner or family clinic, meaning more check-ups and preventative
For healthcare professionals, this increased patient load means
more providers will be needed; some will gain traction in positions of greater
authority as those with less experience are hired. The shortage of primary care
physicians will mean increased access to nurse practitioners (NPs) and
physician assistants (PAs), allowing localized healthcare to more patients, making
it unnecessary to travel to distant hospitals.
The increased presence of non-physician providers such as
laboratory professionals, respiratory technicians, NPs and PAs in
decision-making positions will bring a heightened awareness and a sense of
respect that has been long overdue. In my work with patients and the general
public, I've encountered many people who are uncertain of the role these
professionals play; by virtue of increased demand, more patients will become
aware of our importance in healthcare.
While many hospital systems are consolidating, combining forces
and units to avoid producing duplicate services, job cuts in the hospital sector
will provide an upswing in business for small practices, family clinics and
general practitioners. This change is likely to mean an increase in employment
for providers in all areas of specialization.
If you are interested in submitting to the Politics of Healthcare
blog, please contact Kelly Wolfgang at email@example.com.
Editor's note: This blog is written by Miguel
A. Bustillos, department chair and professor at California University of
Management & Sciences in Virginia.
us have heard about the Medicaid expansion and how states like Florida, Texas
and Virginia are against it. Some do not understand why the Medicaid expansion
has become such a big issue or what exactly the Medicaid expansion is.
Medicaid expansion, expected to be fully implemented by 2014, is a plan under the
Patient Protection and Affordable Care Act (PPACA) to expand medical coverage
for a number of people who do not qualify under the current plan. The Medicaid expansion
mandates that a state must meet PPACA standards to receive full federal funding,
which is needed to increase the current plan. The largest problem involving the
mandate is how states will cover the "new eligibles," those patients who are
receiving Medicaid assistance for the first time. It is estimated that 15.9
million new enrollees will participate in the plan by 2019.
federal government currently pays, on average, about 57% of the total cost of
Medicaid enrollees in each state. Of those that qualify for Medicaid, only 62%
have signed up for Medicaid benefits, leaving the remaining 38% without benefits.
Generally, those that are not taking the benefit either don't know that they
qualify or refused the benefit.
were to accept the Medicaid expansion, they would continue to pay for the
benefits of the 62% that are currently covered; in addition, they will have to
cover the 38% that qualified under the previous requirement, but did not take
the benefit. According to the new mandate, states must also provide for the new
the Medicaid expansion mandate, the federal government will continue to pay the
cost for about 57% of the 62% that are currently taking the benefit. With the
new law, the 38% that did not receive benefits will now either take the benefit
or pay a tax penalty. Some states believe that those who are qualified will
take the benefit rather than pay the penalty. Despite the "new enrollee" status
of those patients, the government will not support funding for any persons who
previously qualified but did not receive benefits.
regards to the true new eligible, the states believe that the cost of providing
Medicaid is just too large for any state to handle. To lessen the burden, the federal government has
penned an agreement to cover 93% of the cost of the true "new enrollees" till
the year 2020.
will decline to take on the Medicaid expansion because it's a voluntary program.
The new law can be very taxing to any state's budget and in most cases, there
are not enough incentives for states to adapt the program.
federal government is, however, not worried. When Medicaid was first signed
into law in 1965, only six states agreed to participate. But by 1982, every
state had joined. As 2014 comes along, and the law comes into full effect, it
will be interesting to see what develops and what does not. With the cost of
providing healthcare to so many people being so high, and the fact that
Medicare benefits will be cut to fund the Medicaid expansion, I foresee much
resistance on its implementation.
reported on Newswise, the
following is a statement by Jo Ivey Boufford, MD, president of The New York
Academy of Medicine, one of the nation's oldest and most prestigious medical
academies, on the seriousness of gun violence as a major public health issue.
The statement is in response to deadly incidents of gun violence in Newtown,
CT, Webster, NY, and the shooting of 15 individuals, three of whom died, during
separate acts of gun violence in Chicago, IL on New Year's Day.
"As a nation, we can only improve the health of the
public when we get our priorities straight. Recent acts of gun violence in
Chicago, Webster, NY, and Newtown, CT cannot be ignored. Neither can the 31,000
Americans who die each year at the hands of a gun. This number exceeds the
number of babies who die each year during their first year of life (25,000) or
people who die from AIDS (9,500) or illicit drugs (17,000).
institute protective measures enforcing speed limits and requiring the use of
safety belts; we implement public health measures such as child vaccinations
and regulations around the safety of food, drugs, and products. Yet guns escape
this type of regulation despite their significant contribution to the mortality
rate each year. We must view gun violence as a serious threat to the public's
health if we want to reduce the number of deaths associated with guns.
can start by banning the sale of assault rifles, high-capacity magazines, and
other facilitators of mass murder. And we must allow government agencies like
the Centers for Disease Control and Prevention to fully exercise their duties
in both surveillance of the incidence and impact of gun violence, and in
educating the public on steps for preventing death and injury through the use
evidence is clear, and we must now take action to protect our neighbors and
ourselves from this devastating public health crisis."
the American Nurses Association and the American College of Emergency
Physicians, two prominent and national healthcare organizations, issued calls
for a ban on the sale of assault weapons.
ADVANCE for Nurse Practitioners & Physician Assistants
asked its readers, "Do you think it is the responsibility of healthcare provider
organizations to urge this type of action?"
some readers had to say:
- "We can
all do our part. As nurses, as humans." - Teanne
stand in a trauma unit for one night and come back and give me your
answer." - Melissa
Absolutely! It's everyone's responsibility to speak up for what they
believe!" - Kelli
not. I have stood in the trauma unit for 15 years and taking away my legal
guns, which I carry concealed because I am licensed to do so, and taking
away my rifles, which I enjoy shooting responsibly, will do nothing to
stop the common street thug with an illegal weapon, other than allow me no
protection for myself and my property when I'm leaving the trauma unit at
midnight, sitting at a red light, and getting jacked by said thug." -
of our ER staff is armed; we see what's out there. As the Boy Scouts say,
be prepared. The bad guys will always find guns; we need to be able to
defend ourselves." - Diana
Prior trauma nurse here at Miami Dade County. Some individuals have no
business having weapons. Period." - Teresa
is definitely not the responsibility of healthcare provider organizations.
This is a civil liberty. I'm sure many members of the groups do not
support a ban. These groups should focus on healthcare issues." -
mental illness awareness and research would be a wiser choice! Let's be
honest, what health professional has not taken some form of weapon to work
with them?" - Susan
you agree with Boufford's statement and the calls for action by the American
Nurses Association and the American College of Emergency Physicians? Weigh in
on the comments below.
Editor's note: We welcome your comments and topic suggestions;
contact blog author Kelly Wolfgang at firstname.lastname@example.org.