Market Cost and Utilization Trends Shape Business Strategy
Patients today have unprecedented choice in where to receive care. Of course, the quality of care is most important, but once the standard of quality is assured, patients often base their decisions on cost, convenience, location and the terms of their benefit plans. To help ensure a steady stream of patients, many hospitals, other facilities and physician practices are forming integrated healthcare systems that offer one-stop shopping for a variety of types of care. Effective strategic decisions about consolidation, expansion, network building and competitive pricing models for these systems must be based upon reliable information about market-level costs and geographically specific trends in service utilization and in venues of care.
Healthcare systems, individual hospitals, ambulatory surgery centers (ASCs), urgent care centers, retail clinics and other types of facilities rely on FH® Inpatient Facility, FH® Outpatient Facility and FH® ASC Facility benchmarks to evaluate facility billing and our professional service benchmarks to gauge staffing costs, as well as FH® Custom Analytics tailored to their needs, to perform a wide range of functions, including:
- Fee schedule creation: With FAIR Health cost information available by facility type, procedure code and geographic area, healthcare systems can determine where their fees stand relative to the market area, and establish a pricing model that fits their objectives.
- Expansion and network building: Our data support decisions on where to locate offices, which types of specialists those offices might need (based on which diagnoses are commonly seen in the area) and strategies for negotiating with those specialists (using our professional fee modules).
- Interpreting trends in venues of service: FAIR Health data can identify shifts in where services are delivered—indicating, for example, that in a given area, hospitals may be losing market share to ASCs, urgent care centers and retail clinics and might want to consider affiliating with or buying such facilities.
- Research: Our FH NPIC® (National Private Insurance Claims) data can support research conducted by affiliated physicians with de-identified member IDs—such as longitudinal studies of a patient’s treatment path—and yield information on diagnoses, venues of service and more.
- Consumer engagement : Hospitals and healthcare systems can strengthen relationships with patients by helping them understand the cost of healthcare and how insurance works. Facilities can license a private-label version of FAIR Health Consumer, FAIR Health’s consumer site, or provide a link from the hospital’s website to our consumer site, to help patients understand the potential costs of care and encourage them to check their coverage with their insurer in advance of treatment. Making consumer tools available to patients in admitting offices when they are completing pre-admission paperwork or in billing offices post-service also can help patients understand their coverage and reduce the burdens for customer service staff.
Location, Location, Location
An ASC company interested in opening facilities in other regions could analyze claims data available through FAIR Health’s FH ASC Facility benchmarks. By evaluating recent trends in place of service and price, it could project revenue in neighboring states and create an expansion strategy offering the best potential for success.