American Association of Provider Compensation Professionals’ Post

High Labor Expenses Continue to Challenge Healthcare Providers Healthcare providers are grappling with persistently high labor costs, with medical groups’ median investment per employed physician surpassing $300,000 for the first time in the third quarter of 2024, according to Kaufman Hall. Medical groups’ median investment per employed physician reached $304,312, reflecting a financial strain that may render current physician employment models unsustainable. "This increase suggests that organizations need to reassess how they manage and compensate physician workforces," said Matthew Bates, managing director and physician enterprise service line leader at Kaufman Hall. Erik Swanson, senior vice president and data analytics group leader at Kaufman Hall, emphasized the need for cost containment. "If this trend of higher expenses and sicker patients continues, organizations must find ways to manage their financial health proactively," Swanson said. Read more at, https://lnkd.in/d6kpkk9r | The Health Colossus #healthcare #economy #thehealthcolossus #labor #costs #expenses #kaufmanhall #report #health #news

CMS’s 2025 physician payment rule just dropped, with a 2.83% cut to the conversion factor. While that might seem minor on paper, it has a real impact on both physicians and hospitals. For physicians, this means doing more with less—smaller budgets, tougher choices on staffing, and harder decisions on whether to take on Medicare patients. For practices, especially those in rural or underserved areas, this can be a huge strain. As a recruiter in the healthcare field, it’s extremely frustrating to watch this unfold. I’m constantly working with healthcare leaders who are trying to balance tight margins with patient safety, physician retention, and other critical KPIs. Every reduction like this just makes it harder for them to build sustainable teams and ensure the high standards of care their patients deserve. How are you seeing this affect your work or organization? Let’s keep the conversation going—I'd love to hear your thoughts. #HealthcareRecruitment #PhysicianReimbursement #CMS #HealthcareChallenges #PatientAccess #TrinityProfessionals #HealthcareRecruitment #TalentStrategy #HealthcareFinance

While reimbursement rates for hospitals consistently climb with inflation, including a 2.6% increase going into effect later this year, the reimbursement rates for doctor’s offices do not. We quantified the potential financial impact of the proposed changes to providers by looking at our top 100 small practice customers who see the highest percentage of Medicare patients. If the proposed cut is approved, the average practice stands to lose $56,000 annually. The effect could be greater among larger practices, especially those in specialty disciplines who see a disproportionate number of older patients. Bob Segert - Chairman and CEO of athenahealth - had this to say, "Doctor’s offices are the front door of the American healthcare system. We owe it to them to support H.R. 2474 and put an end to annual Congressional stop-gap spending bills. Now is the time to invest in the policies, programs, and technologies that build more resiliency in this most critical infrastructure and support those who support us in our time of need. Our collective health depends on it." Read more from Bob Segert here: https://bit.ly/4eag247 #Healthcare #PhysicianReimbursement #MedicareReimbursement

Hey everyone! Did you know that the healthcare industry is booming, set to hit $11.9 trillion by 2025? But with growth comes its fair share of challenges, especially in healthcare IT. In 2024, we're seeing firsthand how rising healthcare costs are straining budgets and how the shortage of healthcare professionals is impacting patient care. Plus, navigating complex regulatory changes is no easy feat! An article written by DocResponse, "Here Are 7 Big Issues Facing Healthcare Right Now," highlights a few of the current trends to expect to continue into 2025. Here are a few worth mentioning.. 1. Rising Healthcare Costs: Healthcare expenses have surged globally, posing a financial strain on individuals and economies. Implications: Patients face financial instability, defer essential treatments and risk bankruptcy. Solution: Leveraging Health Information Technology (HIT) like Electronic Health Records (EHRs) to reduce outpatient care costs and enhance efficiency. 2. Shortage of Healthcare Professionals: Critical staffing shortages due to pandemic-related stress and high turnover rates. Implications: Increased demand for services, compromised quality of care, and financial strain on hospitals. Solution: Implementing technology-driven solutions like telehealth to expand access to care and reduce workload stress. 3. Regulatory Changes Impacting Healthcare Providers: Constant evolution of federal and state-level regulations, adding complexity to compliance. Implications: Financial uncertainty, operational disruption, and data privacy concerns. Solution: Establishing compliance committees, adopting advanced health information systems, and conducting regular audits to ensure adherence. Are there any other trends in Healthcare worth mentioning? Would love to hear my networks thoughts! #HealthcareIT #Innovation #DigitalHealth #HealthcareChallenges

Another physician pay cut in 2025 is unsustainable. I hope congress can look at this cut as I do. Physicians are the backbone to the whole healthcare system and play a vital role in the healthcare ecosystem. If we continue to cut our support system, the system will fail. Physicians are operating on very thin margins in a time of rising costs. Currently, they have to see more patients today just to cover their cost which leads to poor patient care and outcomes. They cannot raise prices like other industries and will be forced to close their doors. If this happens, patients will have no choice but to present to the ERs with issues that could have been handled in an office setting. Our healthcare system is going in the wrong direction, and the first fix needs to be paying physicians accordingly. #congress #medicarefeeschedule #2025feeschedule

Are GLP-1s making your healthcare budget obese? Recent studies show that many patients stop taking weight loss medications before any clinical benefit can be realized. Employers are seeing this trend and starting to rethink their approach to coverage for these expensive medications. One approach to providing a benefit without canceling coverage is through a weight loss HRA. In this model, the employers decides how much to provide as a defined contribution and employees use the HRA to pay for the medication. Moreover, the cash price for these medications are significantly lower than PBM negotiated rates, allowing employers and employees alike to save. Want more? Check out our video in the pinned comment below with Jane Suttmeier, MBA on the Forma Weight Loss HRA #GLP1 #EmployeeBenefits #PBM

https://lnkd.in/eDpUBMTJ Why should anyone beg for economic equity and health equity for our patients. The message is clear. The priority is clear. Human resource is just as valuable as any other resource and it is time to put value to it. #HR10073

❓Why do healthcare costs keep rising above inflation? It's not a simple question, and there isn't a simple answer. But let's explore this by comparing and contrasting a healthy market with US healthcare. ⚖️ 𝐇𝐞𝐚𝐥𝐭𝐡𝐲 𝐔𝐒 𝐌𝐚𝐫𝐤𝐞𝐭 Hundreds of millions of consumers: ✅ Know what they need ✅ Know what it costs ✅ Pay for each good or service ✅ Keep prices in check by making one of three decisions: (1) Yes (2) No (3) Yes to an alternative 💡Turns out options (2) and (3) have extraordinary power to keep prices in check. Need convincing? Look no further than Amazon. 🏥𝐔𝐒 𝐇𝐞𝐚𝐥𝐭𝐡𝐜𝐚𝐫𝐞 ❌ Not always clear what you need without the help of a healthcare professional ❌ Price is difficult to know in advance or at the point of care (although this is improving) ❌ Prices are negotiated in aggregate by a small set of people working on behalf of consumers rather than hundreds of millions of consumers working on behalf of themselves. ❌ Majority of healthcare costs are incurred beyond the deductible/coinsurance/copays ❌ When you're really sick, economics go out the window, and the price doesn't matter 💡The result? ➝ "Yes"/"No" decisions don't carry their typical financial disincentive/incentive ➝ "Yes" doesn't turn to "No" as prices rise ➝ "Yes" doesn't turn to "No" as the value of a service decreases ➝ "Yes to an alternative" is severely underutilized 📈 Costs continue to rise This is one angle, but it's not the only one. And there's a lot more to unpack here. What's your take?

Navigating Inflation: Strategies for Sustaining Quality Patient Care In the face of rising inflation, the patient care industry confronts substantial challenges affecting operational costs, pricing strategies, workforce dynamics, and overall quality of care. Recent insights from Practical Patient Care highlight how healthcare providers can navigate these complexities through strategic cost management, innovative technologies, and collaborative partnerships. Rising prices for medical supplies, energy, and labor significantly strain healthcare budgets, while insurance reimbursement rates often lag, complicating financial stability. Providers are also grappling with the added challenge of ensuring accessibility for uninsured and underinsured patients. To mitigate these impacts, healthcare organizations can optimize supply chains, invest in energy-efficient technologies, and streamline administrative processes. Embracing telemedicine and digital health tools not only reduces costs but also improves patient access and outcomes. Collaborative efforts with suppliers and insurers, alongside active policy advocacy, are crucial in securing fair pricing and fostering sustainable practices. By adopting these strategies, the patient care industry can better manage the effects of inflation, ensuring that quality care remains accessible to all. Read more on this insightful article: https://lnkd.in/e8a43KU3 📰 Stay ahead of the curve by following Practical Patient Care on LinkedIn for more industry news and insights. You can also access our latest edition here: https://lnkd.in/guUBWkRE #PracticalPatientCare #Healthcare #Inflation #CostManagement

Over the past few days, I dove into RAND 5.0; I’m really into data that sheds light on healthcare prices, and there’s some really interesting stuff here.   Consistent with prior studies, 5.0 highlights that commercial reimbursements are materially higher than governmental programs, there’s a lot of price disparity both within markets and across markets, and – based on the quality measures cited in the report – there’s not a clear linkage between price and quality.   One thing that surprised me a bit was how much the report leaned into employers using these results to make benefit plan decisions. Directionally, I think there’s excellent research and information here, but there can be some pretty big gaps between directional and actionable.   There’s certainly no perfect dataset to support these kind of decisions, but some considerations specific to an employer are:   + What health plans and networks are represented in the data? + How much have provider contracts changed from 2022 (the study baseline) to current? + Is this data applicable to my specific population / can we extrapolate? As a whole, the study indicates it covers about 6% of the private market, but some states (e.g., Texas) appear to cover <1% of the private market. + Do I care about the prices I pay relative to Medicare, or do I care about the prices I pay? + What is the best measure of provider quality?   Directionally, it’s valuable to know, in aggregate, who the high-cost providers are in a given market. But to make informed decisions, it’s critical to understand TPA-specific and network-specific contracts at those providers, and it’s also really important to understand the actual price differential – it doesn’t matter to my benefits budget if Medicare pays a higher reimbursement to a Teaching Hospital.   We are still in the very, very early stages of being able to use hospital (HPT) and payer (TiC) price transparency data to make actionable benefits program decisions; however, in theory, the HPT/TiC data do allow for this deeper level of analysis (by health plan, by network, actual price comparisons), though you also need to ask the hard questions about data quality and data reliability. And we will continue to have an ongoing challenge of determining the best approach to assess the quality of healthcare.   What do you think employers can do with RAND / HPT / TiC? #healthcare #pricetransparency #employeebenefits