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Posted on April 21, 2016 by West Corporation 


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Trouble with the Cost Curve

By Colin Roberts
High-risk patients—those with chronic conditions, for example—are the primary drivers of cost in healthcare today, due to the level of coordination and number of personal interactions required to successfully manage their health and treatment.

As providers seek opportunities to bend the healthcare cost curve in a more favorable direction, they might wish to pay closer attention to the “care curve” and whether they should really handle every patient, regardless of health status or requirements, exactly the same. I think what they see may surprise them.

Let’s face it, patients have different requirements and needs, depending on their level of risk. Dedicating resources—like licensed clinical staff—to handle requests from low-risk patients, or patients just seeking general information, is simply unsustainable from a cost and efficiency standpoint.

Communication strategies and tactics vary from hospital to hospital, but each deals with the challenges of reducing costs while accommodating the varying needs of a growing patient population. The strategic use of automation technology based on where patients are on the spectrum of risk allows your organization to put a “human touch” where it is most needed: in areas relating to chronic care and transition care management; and provide customer-friendly, intelligent automation for patients who require more basic services, like routine care management.

When looking at the ways in which West’s technologies help health systems, we always look at how we can assist in driving efficiencies. One way in doing this is to leverage technology in places where people are being used to do the work. In today’s world of healthcare, people are being used to administer all facets of care along the cost/risk curve. For example, many health systems answer all phone calls with people, rather than enabling self-service within an IVR phone system.

Consider—if your organization requires a person to schedule every appointment or give them directions to your facility, it costs you money, time, and resources better served elsewhere. What makes self-service so critical is that every time a live person at your organization picks up the phone, that call becomes significantly more expensive than if it was handled with automated technology.

Thankfully, with today’s technology, even automated processes can be highly personalized—both in message (i.e., specific to the individual patient) and the mode of communication (i.e., the patient’s preferred communication channel: phone call, text, email, etc.).

As we move down the cost/risk curve, there is greater application of technology to support patients. For example, on one side of this curve we have the access center/call center, and on the other side we have doctors, nurses, and other licensed staff. In the middle are varying degrees of technology applications, and it’s those health systems who get this mix right who will be best positioned to drive costs out of their model.

The reimbursement model is shifting along this same curve: as the market moves to a more Value Based model, the higher risk patients are going to become more of a focus, because they are driving the high costs. As revenue models become tied to the “outcomes” of these patients, then more care will need to be applied to these patients. Because of this, a health system has two options: 1) hire more care managers (RNs, MAs, etc.) to help manage these patients, or 2) apply technology down the curve so that those care managers can be better dispersed across the top of the curve where the sick are costing $$$.

Colin Roberts, Senior Director, Healthcare Product Integration at West Corporation, has more than a decade of expertise in health analytics, patient engagement and payment integrity. Reach him at croberts@west.com.

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