narrow network

— Photo from Bundesarchiv, Bild 183-J28413

This MedPage article looks at how the move to value-based payment is hammering the bottom lines of many hospitals. Nonetheless, analysts say that systems will see a turnaround  once the  sector more fully adopts the value-based care model.

“The bad news is that probably will take a while.”

Most  systems are said to be  on the expense side, by identifying and eliminating unneeded procedures and imaging, and developing protocols for better and more efficient care. But, of course, this can have a major downside for revenue.
Reimbursement shifts are taking longer than most providers expected, Jeff Hoffman of Kurt Salmon’s Health Care Group said.
MedPage paraphrased him as saying that “new technologies to improve care and patient access, such as telemedicine, cost money. Providers are also buying primary care medical groups and refocusing their processes and protocols to create narrow networks that serve defined populations.
“That’s a huge expense that will continue to drain health system resources, whereas achieving real value under population health models remains elusive for many as health systems struggle to manage chronic patient populations and transitions into, and from, post-acute environments….”

Mr. Hoffman said: “So for a long time, healthcare providers will be trying to reduce the number of customers they have and how much those customers pay. That’s not a recipe to increase profits.”

MedPage added: “But once those base investments are made, Hoffman said, health networks can start driving new sources of revenue, use data analytics to target care to individuals who use an outsized amount of the network’s resources, and even create their own insurance plans or partner with insurers to target their narrow network populations. That’s the promise of population health management, which is distinct from value-based care and which most providers won’t achieve for some time.”