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How eConsults improve health system revenue strategy by optimizing referral management

Featured in Healthcare Business Today,  Payers and Providers, April 2020

By: Mark Cittadino, Head of Health System Sales, AristaMD

 Fee-for-service (FFS) remains the most common health system revenue strategy across the United States. For FFS health systems, it’s imperative to support network optimization strategies in order to solidify revenue flow and efficiency. FFS health systems must balance competing issues such as improving patient retention, reducing readmissions, and efficiently distributing low- and high-acuity cases to maximize the value of specialty care within these systems. In addressing each of these and other initiatives, communication is essential. eConsults provide a secure and documented messaging platform that facilitates direct communication between primary care providers (PCPs) and specialists, directly benefitting FFS health systems by supporting their revenue strategy in several ways.  

  1. Improve patient retention

For healthcare organizations across the board, improving patient retention, or reducing patient leakage, is a vitally important goal for shoring up revenue. The reason for this is clear: patient leakage is expensive.

  • According to 2018 survey data, 43% of healthcare organizations are losing more than 10% of revenue

  • 19% of healthcare organizations are losing more than 20% of revenue as a result of patient leakage

  • 54% of referrals lead to completed specialist appointments

  • According to Health Care Dive, almost half of doctors struggle to determine what specialists are in-network

Adopting an eConsult platform can assist with retaining patients for specialty care and related services, both increasing FFS revenue and improving performance under value-based care arrangements. By leveraging eConsults, health systems can increase utilization of in-network system specialists by keeping primary care physicians connected with them, helping avoid leaking patients outside of the system in two ways:

  1. Patients needing specialty care that may have gone without are still in-network, being treated by their primary care provider.

  2. Patients in need of a face-to-face specialist appointment will funnel into in-network health system specialists, who may have already weighed in on the patient case via eConsult. Improved information regarding in-network specialists can help avoid a third of out-of-network referrals, the doctors estimated. This greatly reduces the chance of patient leakage and thus improves FFS revenue reimbursement.

       2. Maximize specialist visit revenue

eConsults can increase efficiency within specialist queues by better equipping primary care settings with necessary resources to handle low-acuity cases. By leveraging eConsults within primary care, PCPs are able to treat a significantly higher percentage of routing and low-acuity referrals. Over 70% of eConsults enable PCPs to manage their patients within the primary care setting. This immediately expedites care for patients and frees face-to-face specialist appointment queues for higher-acuity and higher-billing patients. 

Besides triaging specialist queues by enabling PCPs to treat low-acuity patients, eConsults also allow PCPs to receive complete workup guidance, including diagnostics and testing. This means, oftentimes, all necessary workup can be completed prior to a specialist visit in a more cost-effective setting. Patients properly prepped for specialist visits help optimize FFS specialist revenue and ancillary service revenue. In addition, patients in need of a face-to-face specialist visit can be more effectively prepared for their appointment (steered to in-network locations of care) by their PCP, backed by specialist recommendations for baseline workups. This results in a more time- and cost-efficient visit with the specialist. 

  1. Reduce readmissions

Hospital readmissions account for another vital metric by which health systems are evaluated. Related to congestive heart failure (CHF), more than one-half of health systems pay penalties for readmissions, hospitals with higher readmission rates are more likely to also have high harm rates for their patients.

In the context of readmissions, care team communication takes on new significance, as often multiple doctors are involved in a patient’s care plan. Miscommunication among doctors, and indeed between doctors and the patient, is not at all uncommon, with as many as 26% of patients reporting that they received conflicting information from their various doctors. Where eConsults come into play is by connecting care teams so that everyone involved in a patient’s care is updated and current on all treatments and recommendations.

Additionally, eConsults allow patients to get the care they need, faster. Through this improved access to care, lower-acuity patients will be less likely to resort to emergency and hospital settings for care that could otherwise be handled within primary care. Primary intervention has proven to improve management of chronic conditions and post-treatment follow up, as a 2014 paper found that following up with a PCP after undergoing a high-risk surgery reduced the risk of patients being readmitted.

Thus, by improving coordination among teams of physicians and by better equipping primary care to handle post-treatment follow up visits, eConsults can help health systems reduce hospital readmissions by up to 17.1%. This helps FFS systems curtail costly readmission penalties and provide greater quality of care for admitted patients, both during and after their hospital stay.

  1. Minimize uncompensated care provisioned within hospital settings to increase capacity for compensated fee-for-service care

In addition to reducing costly readmissions, eConsults also help address another issue with hospital patient flow: mitigating uncompensated care in hospital settings. Many hospitals, particularly those in rural areas, struggle to maintain their operating margin, in large part due to uncompensated care. Patients whose primary care providers lack adequate resources to treat them often wind up in emergency settings, but they lack the financial resources to cover the cost of hospital care, creating a profit loss while utilizing health system resources.

eConsults can address two major causes of uncompensated hospital care: unnecessary referrals that go unfulfilled by patients who cannot afford specialist appointments and wind up in emergency rooms, and a lack of adequate primary care resources to treat low-acuity patients. FFS systems can leverage eConsults to better provide “right time, right place, right provider” care in a care more affordable setting, both reducing uncompensated visits and freeing up hospital resources for higher-acuity patients.

Some health systems already provide support to federally qualified health centers (FQHCs) that provide care to underserved populations. For such health systems, this is a sound investment, as they prefer to avoid having these patients come to the ER for primary care that should be conducted in a more appropriate setting. Investments in telehealth can similarly be an integral part of a solid health system revenue strategy. For example, Sutter Health supports an Emergency Department Information Exchange platform that providers and paramedics have access to, enabling these medical professionals to see all relevant health information and mitigate uncompensated hospital stays as a result. Enabling an FQHC to leverage telehealth technologies like eConsults would further empower these providers to provide efficient care.

  1. Capture additional patients in-network

An alternative strategy to primary care expansion is for organizations to create clinically integrated networks (CINs) of independent providers aligned with their own networks. These relationships can then be used to steer patients to specialists within network. In this scenario, eConsults can be leveraged as a means of capturing specialty care referrals from local primary care practices. Specialists can identify patients in need of specialty referrals and subsequently see these patients, providing necessary care while enabling FFS healthcare organizations to thrive. These visits are reliably higher-acuity, while lower-acuity (and lower-billing) patients not in need of a face-to-face referral are efficiently (and more effectively) managed within primary care.

Conclusion

For FFS health systems aiming to more efficiently manage healthcare resources, eConsults provide a technology-based option that addresses, both directly and indirectly, some of the most pressing concerns when it comes to optimizing health system revenue strategy—and, importantly, bettering patient outcomes. As a means of communication, eConsults can help health organizations better coordinate care, reducing costly readmissions and ensuring that patients who are discharged have a well-organized care plan. eConsults can help better optimize specialist patient queues, granting higher-acuity patients efficient access to the face-to-face care they need, thereby improving quality of care and revenue. And eConsults are an excellent means of both retaining patients and expanding the patient population of a health organization by capturing higher-acuity patients for in-network specialists. Overall, eConsults are highly effective in facilitating successful revenue strategies for FFS health systems, and this telehealth technology provides a clear method for these health systems to improve resource allocation to improve delivery of care for health organizations, doctors, and patients alike.

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