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Alternative reimbursement strategies and the total cost of care

Podcast - July 1, 2019

Billing & Collections

Value-Based Operations

Practice Efficiency

Doral Davis-Jacobsen, MBA, FACMPE, is a leader in the medical consulting industry and specializes in value-based contracting and payment reform. She recently sat down with MGMA senior editor Daniel Williams to discuss reimbursement models and the total cost of care. 

Reimbursement can be what we make it

Jacobsen's background expands into areas such as revenue cycle and claims management, practice management, executive leadership and even time spent from the payer's viewpoint. She uses all of these experiences to create a comprehensive wealth of information to provide to her consulting clients. She gave us some tips and advice on leveraging strengths in the practice by thinking outside of the box while also better understanding alternative payment options and the structures behind them.
What sparked Jacobsen’s passion for alternative reimbursement strategies was actually a personal experience. Approximately 16 years ago she had a 2-year-old daughter diagnosed with a muscle condition in the eye that prevents it from focusing appropriately. They consulted with an ophthalmologist who advised a series of three surgeries to correct it. She took it upon herself to do some research and found that there had been some success with vision therapy instead. Through it all, her daughter is now 18 with perfect vision and zero complications without having any procedures performed. From that experience, she started to evaluate how much money and trauma they avoided by this alternative pathway, knowing this could not be the only place in healthcare reimbursement with such inefficiencies and began to dive deeper.

How we better understand the payers

Payers are a complex factor in the way providers are compensated and for a medical practice's bottom-line reimbursement. Jacobsen believes that understanding them with a partnership or collaborative sense can alter the way these entities are aligned. Something as simple as visiting a payer's website and contacting a representative to discuss strategy could elicit many advantages. She trusts, and has proven, building a relationship with these organizations provide opportunities to demonstrate the practice’s value to the insurance company and highlight areas that they can both improve upon. Things such as preventative care, more follow-up calls or patient engagement are potential areas that could incur savings on behalf of the patient, practice and payer. Making insurance companies aware of these value propositions should shed some light into the initiatives being taken and provide information around the benefits available to them.

The shift from fee-for-service to value-based reimbursement

While healthcare is forever changing, one of the biggest changes is the shift from fee-for-service to a value-based reimbursement model. Jacobsen said that there are two key points to consider when evaluating the potential savings in a value-based model:
  1. More services performed might not mean more money in a value-based system.
  2. We really should be providing the appropriate amount of care in the most cost-effective setting.
Instead of counting the number of codes that are submitted and evaluating the reimbursement potential off how many can be submitted, we should instead be looking at the savings from the lens of the previously mentioned patient, practice, and payer. She has had several success stories whether it be understanding the savings of performing an orthopedic surgery in an ambulatory center versus the hospital or having care navigators that help hold patients accountable for their overall health and enhance collaborative access. These instances were evaluated from a total cost perspective on behalf of all parties and moved forward if it proved beneficial to the groups, which they did.

How it ties together

While there are some difficulties within healthcare such as the disconnect between systems or complex billing guidelines that create some barriers to optimization, a continuous push to evaluate these operations are necessary to reach a more inclusive end result. Developing new processes that look at the reimbursement models and patient from a more holistic approach may be one of the key successes to solving for the complexity of our current configurations.

Like it was discussed, developing relationships and understanding the benefits to the patient, practice, and payer should create an environment for collaboration and improvement across the realm of reimbursement.

Additional resources

Continue your knowledge with MGMA best seller, The Physician Billing Process: Navigating Potholes on the Road to Getting Paid, 3rd Edition, containing expert analysis and guidance to help you navigate the billing and reimbursement landscape.

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