The Big C
And that, essentially, is the crux of the transition most of healthcare will eventually face as the price for healthcare continues to outpace the rate of inflation–capitation. Whatever the mechanism, future healthcare survivors will be determined not by how many widgets they're able to produce, but by how much they save on producing as few widgets as are needed.
"Care has moved from the hospital to the outpatient setting and the reimbursement structure has moved along with it," Harper says. He notes that within Kaiser Permanente, for example, patients can email their physicians to get simple questions addressed without coming in for an office visit, and physician telephone appointments have become a key part of the delivery system, providing patients greater convenience.
This kind of innovation is much easier to incorporate in a capitated environment.
Harper went through some of the metrics to which he pays the most attention. Many of them were undoubtedly foreign to the executives attending his session, but he stressed that they need to become familiar with them.
"Does anyone know what 'days-per-thousand' means?" he asked, to silence. (Hint: it's an inpatient day utilization rate measurement over time.)
While you're thinking about that, what is your days-in-a-skilled-nursing-facility rate?
When you're capitated, you can focus on these things, because they represent expenses, and the name of the game is expense management, Harper says.