Hospitals and health systems in rural areas face enormous operational and financial challenges.
Rural markets represent 20% of healthcare in the U.S. but 1 in 4 rural hospitals are at extreme risk of closure. Over half of independent hospitals in rural areas are operating at a loss. Often these organizations receive lower reimbursements than hospitals in major metro areas for the same procedures. Without adequate data to generate meaningful insights, many rural providers are operating without the line of sight needed to tackle these problems.
In a Becker’s webinar sponsored by Claritev, Chris Kemp, senior vice president, provider markets at Claritev, and Brian Burnside, president and CEO, Carlinville Area Hospitals & Clinics in Illinois, discussed how rural healthcare organizations can use data science to support strategic growth, improve revenue and contain costs.
Here are three key takeaways from their conversation:
- Data enabled Carlinville Area Hospitals & Clinics to reduce patient leakage and double its revenue.
According to Medicare, Carlinville Area Hospitals & Clinics is classified as a critical access hospital. In recent years, however, the organization has transformed itself into a comprehensive rural health system that provides patients with strong primary care and access to specialists. Carlinville Area Hospitals & Clinics expects to double its net patient revenue between 2020 and 2025.
Data played a central role in this evolution. Mr. Burnside explained that by analyzing data, the team discovered significant patient leakage, as people transferred from Carlinville’s ER to other institutions for care. This led to lost revenue, even though Carlinville’s staff possessed significant critical care skills.
“We made decisions to transfer patients in the past,” he said. “Once we were able to identify which patients we could serve better, that knowledge fueled our growth.” - Analyzing publicly available claims information can be costly and resource intensive for hospitals and health systems.
While valuable insights reside within claims-related big data, it’s often challenging for healthcare organizations — especially smaller organizations — to analyze the information on their own. Each payer’s files contain unique nuances that need to be sorted out. Without a high degree of claim scrubbing, some pieces of information remain hidden.
“The resources required to really analyze publicly available claims information and identify meaningful conclusions were more than what my organization could spare,” Mr. Burnside said.
To plug data gaps and generate actionable insights, Carlinville Area Hospitals & Clinics turned to Claritev for help. Claritev recognizes that both a robust discovery process and access to information are needed for successful data analysis. Mr. Kemp observed that data is just data if hospitals and health systems are unable to answer key strategic questions. A defined approach to discovery is needed to understand organizational dynamics.
Once Claritev completes the discovery process for a client, it can access up to 500 billion rate records from over 150 payers. which are updated monthly. However, that isn’t all. “We also get direct data from provider files and we purchase additional data sources, such as Medicare Advantage information,” Mr. Kemp said. “As we engage with organizations like Carlinville, we obtain access to their claims data.” - When it comes to negotiating fair rates with payers, data is a superpower.
Applying data science to publicly available claims data is powerful for hospitals and health systems. It allows leaders to ensure their organizations receive every dollar from payers they’re entitled to.
Through Claritev, Carlinville Area Hospitals & Clinics discovered that one payer paid them $3,733 for an MRI lumbar spine. That payer reimbursed a competitor, peer hospital in a similar rural market $4,557 for the same procedure.
“This type of information will pay dividends for us as we work through payer negotiations,” Mr. Burnside said. “I can’t stress enough how insightful it is for me to see where those differences in reimbursements are. Up to this point, I had been blind.”
When data science is embedded into an organization’s strategic planning process, it’s possible to identify market dynamics and determine whether reimbursement and pricing are maximized. Mr. Kemp noted that with real-time actionable data, hospitals and health systems can answer the large revenue-improvement and cost-containment questions that have been opaque for so long.
Healthcare organizations like Carlinville Area Hospitals & Clinics continue to discover how impactful data can be for transparency, quality and network design. “I believe that the data available to rural and urban hospitals is a new superpower for us,” Mr. Burnside said. “We can use this information to make the right decisions for our markets.”
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