As health care becomes more competitive, hospitals and health systems are striving to become efficient and cost-effective. Now more than ever, health care organizations are looking for ways to boost revenue to cover higher health care costs and enable themselves to afford innovative, advancing technologies. To accomplish this, hospital executives must manage perspectives from physicians and financial leaders to ensure all points of view are considered during the decision-making process. In this episode of Value-Based Care Insights, Daniel J. Marino speaks with Dr. George Mayzell and Steven Berger to discuss how organizations can positively engage physicians and CFOs to create a win-win across all departments.
Daniel J. Marino, Managing Partner, Lumina Health Partners
Dr. George Mayzell, Managing Principal, Lumina Health Partners
Steven Berger, Principal, Lumina Health Partners
Episode Discussion Areas:
1. What happens when perspectives differ amongst physicians and financial leaders?
- What and how to improve is driven by a set of metrics. Metrics must be a core part of the conversation.
2. What are the major obstacles organizations must overcome to manage perspectives and engage leaders?
- Physicians must be involved in clinical and financial outcomes.
- Hospitals must manage differently to boost revenue and address both clinical and financial performance to achieve goals.
- CFOs have not traditionally worked well with physicians, and that needs to change.
3. Who’s doing the heavy lifting?
- Incentives must be aligned with all stakeholders (administration, physicians, etc.).
- Leaders should start with clinical improvements, then transition into financial improvements.
- Leaders can use different scenarios to explain varying perspectives.
8 Key Takeaways: Collaboration Strategies for Reducing Costs and Managing Outcomes
- How can organizations cut costs without impacting the delivery of care?
There’s a disconnect between hospital and physician finances, and there’s an understanding that cutting costs across the board doesn’t generally work. The answer involves maintaining the “margin mission” to support the organization’s future plans, while giving clinicians what they need. Often, that’s related to increasing efficiencies.
- CFOs want to see immediate returns on their investment.
Organizations want to ensure they get what they expect, although they understand that sometimes takes time. Setting benchmarks can help identify progress, as can quarterly reporting.
- How can we reimagine health care operationally?
Improving collaboration between physicians and financial leadership to show where opportunities are may create less expensive- and positive outcomes. Actionable information lets finance and physicians agree on what to measure and potential next steps.
- Is it possible to realize cost efficiencies?
Most CFOs are attuned to these issues. Unfortunately, most hospitals don’t have efficient and effective cost accounting systems, and without them, organizations can’t easily show physicians how they’re doing against targets, as well as their peers.
- How do physicians define return on investment (ROI) and contribution margin?
Physicians don’t generally focus on ROI; instead, they’re concerned about their patients and ensuring they achieve great outcomes. They want to be good financial stewards, but they don’t have time to look at it like a finance person would. If you can’t tie financial metrics back to patient care, tension will build between finance leaders and physicians.
- Care management is easier to justify in an ACO.
If an organization is entering into value-based contracts, they can’t succeed without having strong care management. Incentives for physicians as well as finance leaders are a must.
- Design systems to provide the information physicians want.
This includes effective cost accounting systems that show physicians how they’re doing financially. Finance leaders must align clinical and financial outcomes and use good-quality data that can be turned into actionable information.
- What factors contribute to a collaborative model that facilitates good patient care?
Absolute transparency, education, relationship-building, and alignment are key. It’s about getting the right people in the right room with the right information.
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About Value-Based Care Insights Podcast
Value-Based Care Insights is a podcast that explores how to optimize the performance of programs to meet the demands of an increasing value-based care payment environment. Hosted by Dan Marino, the VBCI podcast highlights recognized experts in the field and within Lumina Health Partners.