With hospital margins thin and disruptors such as retain clinics penetrating the healthcare industry, health systems are looking to tighten up their revenue cycle processes and procedures as they brace for change.
With the first quarter of the year in the books, some trends are starting to emerge, and may give a clue as to how the rest of the year will play out. Artificial intelligence, telemedicine and platforms for real-time payments could very well reshape the industry by year’s end, or at least move providers toward convenience, consumerism and technological innovation.
In such a complex environment, making accurate predictions can be a challenge. But Seth Cohen is giving it his best shot.
Cohen is the president and co-founder of OODA Health, based in San Francisco, and he’s been watching these trends and others with a critical eye. The startup’s mission is to overhaul the process through which care is paid, and while that gives the company a stake in how things play out, Cohen is taking a macro view — and thinks there are a few things to watch out for as 2019’s second quarter gets under way.
A lot of people are buzzing about AI and its potential for transformative change in healthcare. Cohen said it would pay to be cautious about how it’s applied.
“I generally am a bit weary of how frequently AI is offered up as a panacea for abroad range of healthcare issues,” he said. “I do not see it having universal benefit, or spread like peanut butter over the entire healthcare system. It needs to follow a rules-based protocol, and AI doesn’t do that well.”
One area in which AI could be hugely valuable is in respect to clinical documentation, which would have ripple effects on a provider’s revenue cycle. The current push is to more efficiently capture information about a clinical encounter, which affords health systems a better handle on things like patient history, clinical outcome, recovery, readmission, and other factors that can easily affect a provider’s ability to collect revenue.
“Capturing all that information historically has been hard, and the data has been fragmented and unstructured,” said Cohen. “AI is structuring that information so we can benefit far more than we have before.”
There’s an opportunity for AI when it comes to the delivery of care — for example, being able to read imaging more effectively. But rules and procedures for AI have to be put into place in terms of the administration of care, he said.
PAYERS AND REAL-TIME PAYMENTS
Another prediction for 2019 is the continued emergence of platforms for real-time payments. It seems intuitive that a provider would want to get paid in real time, and certainly patients appreciate having clarity and certainty around what they owe. An effective strategy for improving the revenue cycle is giving consumers a clear picture of their financial obligations, as they’re more apt to work out payments for their care.
But payers may be on board with real-time payments as well.
“There’s this common assumption that the insurance companies make money off the fact that they withhold payment and delay payment,” said Cohen. “What we find is the payers are taxed by this system as much as anyone else. They’re very concerned about the impact on patient experience.
“No one really has any loyalty to their health plans today,” he said, “so they are very eager to build a value proposition with a member … especially if the market becomes more competitive with new entrants.”
Payers often have to keep millions of dollars in reserve because they don’t know how much they’ll end up owing. Two months from now, they could finally adjudicate a claim that represents a million dollar expense — one they couldn’t have forecasted. That prevents them from using that capital to invest in their business.
Real-time payments just might be a step in the right direction for all involved: Payer, provider and patient.
One revenue stream that could be beneficial to providers is in the realm of telemedicine, an increasingly popular model in which patients connect to doctors and nurses remotely, offering convenience and in particular access to consumers who can’t easily make a trip to the hospital.
Due partly to cost, Cohen predicts employers will look to the maturing telehealth model when investing in specific therapeutic needs. It’s an opportunity to meet patients where they are; many people prefer to do things from the comfort of their own home, and with the model coming into its own, remote care is starting to cover specific ailments such a diabetes.
“I would say it’s less about, ‘Is it the right model?’ and more about, ‘How do you get it embedded in a way that’s convenient for users?'” said Cohen.
Telemedicine used to be a siloed offering, he said. But now, when someone goes to the homepage for their health plan, they’re often presented with a standard triage flow. Based on that, they can secure a screen with a telemedicine specialist.
“Providers will offer it a lot more,” said Cohen. “It will become a standard part of a health plan. You’ll see digital-only plans — a product offered which is digital-only for a certain rate. This would require you to go to a telemedicine offering as your first point of care rather than a PCP.
“It makes a ton of sense,” he said. “Getting quality care and meeting inside four walls don’t necessarily have to go together. To buy groceries, you don’t have to go to a building anymore. So why do we have to do that in healthcare?”
One final prediction for the year: Startups will be squeezing their way into the healthcare space, and they’ll partner with health plans to achieve scale.
“Some of the innovators that have partnered with health plans have been some of the most successful,” Cohen said. “Teladoc, for example, is a big business because they work with health plans and they’re scaled to them. A number of innovative companies have reached scale by working with health plans. It’s hard to be outside of the health plans and get scale, because that’s what the health plans offered.