There’s been a surge of merger and acquisition (M&A) activity within the healthcare industry. During the first quarter of 2018, there were M&A deals totaling nearly $156B, the strongest start in over a decade.1, 2 While healthcare companies view mergers and acquisitions as strategic growth initiatives, how do they impact their customers – healthcare organizations – and their patients?
If you are in anyway involved in the healthcare contracting process, you know the tremendous challenge that providers, manufacturers and distributors face when attempting to manually align data for pricing accuracy. With thousands of price changes happening each day, all parties to a contract spend an enormous amount of time and money trying to keep up with them.
With the healthcare industry experiencing such a large volume of mergers and acquisitions, many hospitals and health systems are dealing with disparate technologies and its impact on efficiency, data management and cost containment. These obstacles can create an even greater burden on supply chain with misaligned contract pricing and increased supply chain exceptions.
The advantages to cloud computing are many, backed by expansive computing power and improved security and efficiency at a lower cost. In line with the trend across most every industry, healthcare has traction and is gaining momentum in the shift to a cloud computing model for these very same advantages. However, preparing your organization to move your Materials Management Information System (MMIS) / Enterprise Resource Planning (ERP) system to a new cloud technology platform is no easy task, and a change of this magnitude necessitates new thinking. Replacing the MMIS/ERP with cloud-based services impacts many critical facets of your organization including finance, human resources, and supply chain.
How mobile technology investments can fast-track your goals for improved interactions with your customers
Delivering a delightful customer experience starts with understanding the customer’s journey. For most healthcare manufacturers and distributors, there are many touch-points available to engage with customers, with mobile being the area of greatest potential. Just in this year, 52% of all worldwide online traffic was generated through mobile phones — that is up from 50% in the previous year.
While we work hard to avoid mistakes, they also are an opportunity for learning and growth. It may be painful in the moment but over the long run the not-so-perfect can be a catalyst for positive change. This was the case for a leading medical manufacturer when they began to truly understand the importance of credentialing their reps to their customers.
Implementing payables automation software, which includes accounts payable (AP) and electronic payments solutions, is one way of reducing costs in the back office. But, Paystream Advisors found almost 50 percent of healthcare organizations today are still using checks to make the majority of their supplier payments. Manual, paper processes are inefficient, labor intensive and costly. These outdated practices are incapable of supporting today’s increasingly complex payment environment. If you are a healthcare organization that is still relying on paper, here are four reasons why your current payment processes aren’t working for you.
The quality of supply chain data is critical to so many operations within a health system. It really is the foundation for success. At our most recent Supply Chain Summit, representatives from TransForm Shared Service Organization presented their data story on the Summit20 stage.
Within the healthcare industry, the personalized patient journey and experience are key topics being discussed. Cloud and mobile computing technologies are both raising consumer expectations and offering solutions to meet them as well.
The adoption of wearable devices has steadily increased over the past several years since the invention of the smartwatch. The annual shipment of wearable devices is projected to increase to 430 million units by 2022. Wearable devices have also evolved beyond smartwatches to include other technological devices such as glasses, headbands, earpieces and other wearables, however, smartwatches are expected to constitute the largest device in this category.
Perception vs. Reality. Is it negatively impacting your healthcare organization? According to Paystream Advisors, electronic payments could help your organization achieve greater financial health, as well as its broader mission of providing value-based, cost-effective, high quality patient care.
In 2015, the U.S. Department of Health and Human Services (HHS) defined a goal to link 30 percent of Medicare payments to value-based reimbursement (VBR) models by 2016 and increase to 50 percent by the end of 2018. Until this development, Medicare reimbursement was primarily fee-for-service. The shift to a VBR model places more emphasis on the outcome of a treatment plan, that is quality over quantity.
PayStream Advisors reports that nearly three-quarters of invoices handled between healthcare suppliers and healthcare organizations are received in paper format or email. When it comes to payments management, research shows that checks are most often used to make payments. Manual, paper-based payment processes are time-consuming and labor-intensive, resulting in delays, missed early payment discounts and poor provider-supplier relationships. Additionally, high volumes of paper checks can lead to significant processing costs, payment processing errors, and a risk of fraudulent or improperly authorized payments.
As healthcare pushes to become a data-driven industry, we must ensure that we can connect the data from every system to make continued improvements in cost reduction, performance, efficiency and above all else, patient care. After years of automation, healthcare faces a familiar dilemma: disparate systems with similar, yet different data. Back-end and clinical systems are unable to “talk” to each other, and when they do, they aren’t speaking the same language because the data doesn’t necessarily match.
In my two previous blog posts, I covered lessons learned on our journey to GHX ePay implementation, and steps we took to gain executive support for the transition. In this post, I’ll cover another challenge that we successfully overcame – securing customer buy-in for the switch from manual credit card payments to automated electronic payments.
“How much did that procedure cost?” Simple question that is simply too difficult for providers to answer. Supply chain plays perhaps the most critical role in helping the industry get to a clear and reliable answer.
Blockchain is a digital decentralized public database that can be shared among its users. It creates an unalterable digitally signed record of each transaction, called a block. For every new transaction, a new block is created which links with the preceding block, thereby resulting in a chain of blocks; this is how blockchain derives its name. Since the blocks cannot be altered or deleted, it is an accurate repository of every transaction made in a blockchain.
In the first blog post of this series, I briefly described CryoLife’s work to implement the GHX ePay solution, the results we have achieved - including a 94 percent reduction in payment processing fees – and the top three lessons learned on our journey. In this next post, I delve deeper into one of our top success factors – securing executive support for the transition.
The 2017 annual survey of hospital CEOs conducted by the American College of Healthcare Executives revealed that financial challenges was their number one concern. Healthcare providers and executives are still trying to grapple with the shift of healthcare from a fee-for-service to a value-based model. As a result of this shift, there has been a marked decline in reimbursement from the government as well as private insurance groups.
The adoption of technological advancements, in healthcare or any industry for that matter, varies for a number of reasons and happens along a predictable continuum. When a new technology emerges, there will be people who adopt at the earliest stages (innovators), early adopters, those in the early majority, those in the late majority, and laggards who resist the adoption altogether. The reasons for these different rates of adoption are varied as well. Some see cost as a prohibitive factor. Some do not trust new technologies and want to make sure that they have been fully vetted before bringing them into their own practice. Others are simply comfortable with their current way of doing things and don't seek out a change.
Like most manufacturers, CryoLife has been challenged to increase operational efficiency and cut costs without negatively impacting product and service quality. Upon examining our processes, we identified accounts receivable (AR) as a significant area for savings.
We manually processed a wide range of payment forms from customers: credit cards, automated clearing house (ACH) payments, wire payments and checks. Payment processing was time consuming, labor intensive and costly. We spent $1.4M annually in credit card processing fees, budgeting $100k per month – that caught the attention of the C-suite.
Even though the European version of the unique device identification regulation was introduced almost four years after the U.S. UDI rule, it stands to broaden the value of the rule with the expanded coverage for implantable devices and the requirement related to generation of real world evidence on the performance of medical devices. Since the U.S. Food and Drug Administration (FDA) UDI rule was introduced, similar mandates have been included in the U.S but only went into effect this year.
The strategic value of supply chain in tackling costs, eliminating waste and driving efficiency has never been more important — or in the spotlight. GHX honors the Best 50 U.S. healthcare organizations for improving operational performance and driving down costs through supply chain automation each year at the GHX Supply Chain Summit. The competition to win gets a little more challenging each year as winners achieve new levels of efficiency, making the accomplishment more noteworthy with each passing year.
We're sitting on the cusp of a technological revolution that will surpass any such shifts we have seen in the past. The speed at which new technologies are disrupting business as usual across so many different industries and practices is unprecedented, and it comes with both a promise and a threat. It promises to make our lives easier, more efficient, and better connected while at the same time threatening to upend norms we've come to depend upon and disrupt management systems that have been in place for decades.
The healthcare industry is at the forefront of this dual promise/threat. Here is a look at the benefits that these new technologies can bring.
Incorporating and maintaining accurate product data within one’s item master is a critical step in gaining visibility, driving purchasing accuracy and capturing revenue. Problems with item master data, whether it is related to incomplete, duplicate or missing information, is painfully felt throughout the value chain in lost savings, reduced charge capture and potential lost revenue. In clinical areas, confusing and duplicate item descriptions can leave clinicians frustrated with search efforts and manually documenting supplies which can lead to further revenue losses. Efforts to pinpoint and address the specific issues can no longer be pushed aside with hospitals already working within thin margins that are likely to get even thinner.
One of the key questions I hear consistently is: how can I design a supply chain for my organization that is truly effective and strategic for my organization? What are the important things I should be prioritizing?
We rely on data every day but getting to the point of truly relevant data is a process. Relevant customer data is more than who buys from me. It is all of the information that describes the people and companies that you care about, and it is everything related to who made it, who buys it, who uses it, who holds the contract and more.
The importance of a well-executed vendor and business associate management plan cannot be overstated. It is certainly obvious from headlines over the last several years that organizations that don’t put the time in are risking financial ramifications as well as damage to reputation, which can be even more costly. The good news is that focusing your efforts on vendor and business associate(BA) management brings value to organizations in multiple ways. By putting into place processes that improve visibility into your vendor population and management of business associate relationships you improve compliance with the Health Insurance Portability and Accountability Act (HIPAA) Final Omnibus Rule, are better prepared for an Office for Civil Rights (OCR) audit, and internally gain greater operational efficiency from more streamlined processes.
Supplies in the category of maintenance, repairs and operations (MRO) can be particularly challenging – and costly - for healthcare providers to manage. While the products may cost only a few dollars each, the overall cost to procure these items can equal - or exceed – the cost of the products themselves.
In many cases, hospital maintenance staff will go out and shop at local stores for these items using their purchasing cards. Not only are the products procured this way often more expensive than those from suppliers with which the hospital has contracted, there are also the added labor costs and other expenses associated with staff members shopping at various local stores. It is clear that gaining visibility into and control over these items presents a significant opportunity for cost savings.
Epayable solutions are widely accepted in many industries as the standard for business-to-business transactions. The healthcare industry, however, has been slow to adopt this payment method. The delay in adopting electronic payments has resulted in inefficiencies that make it more challenging for healthcare to deliver against its mission to strip waste from the system.
Successful supplier and provider relationships are forged by information sharing that allows the provider to secure the data and information it needs for daily business practices and tasks throughout its organization. Legal and contracting documentation, accounts payable (AP) data, purchasing data and compliance documents all need to be vetted, stored and updated on a regular basis.
The holy grail of electronic health record (EHR) systems is to enable healthcare organizations to deliver more effective and efficient patient care. However, when the data within these EHRs is siloed within certain departments or contain inaccurate or incomplete information, it becomes nearly impossible to accurately track medical costs, reorder necessary supplies and support the industry’s mission to provide that desired level of outstanding patient care.