3 Insider Tips on Cutting Costs without Strangling Growth

Philip Betbeze, for HealthLeaders Media , July 25, 2014

3. Prove your quality and outcomes; get enhanced revenues

I don't think folks are really aggressively looking at how to get after enhanced revenues in their market for the same level of volume. By that I mean a lot of stuff you read in your magazine and others is that the price we get for episodes of care is being ratcheted down by payers. Woe is us.

Well, that may be, but if you have a strong accountable care organization or clinical structure, it is possible for you to take control of that. Payers tell us they're surprised we have the highest charges in terms of what they're contracted to pay us, but they also say when they look at total cost of care data, we are lower and our quality and patient safety is better.

That's what the game is about.

Another example: We earn an ACO agreement with Aetna and when they sell it I get 100% of that volume. I accept a reduced revenue per patient, but I get fourfold more volume. That's why growth is so important. With systems like ours, we have high fixed costs, and you have to cover that."

Philip Betbeze is senior leadership editor with HealthLeaders Media.
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