Integration: Early in the game of healthcare reform

At the recent annual J.P. Morgan Healthcare Conference in San Francisco—“where Wall Street meets healthcare to talk business,” according to HealthLeaders the themes ranged from preparing for the newly insured to continuing the expansion of clinically integrated networks. The conference included both for-profit and not-for-profit health systems discussing what had helped make them successful in this early stage of healthcare reform.

Clinical integration is a hot topic for any healthcare system, regardless of profit status in this early stage of healthcare reform. And that’s because success is dependent on it. As Chicago-based Advocate Health Care executive vice president Lee B. Sacks MD noted at the conference, “Clinical integration has allowed us to advance in value-based care.”

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Sustainability Can Really Pay Off

The core mandates of the Affordable Care Act are to increase access to healthcare, while decreasing costs and limiting waste. Every U.S. healthcare organization today is looking for ways to align with healthcare reform in order to meet these goals. While companies are instituting a number of different initiatives, there is one that we believe strongly in that has recently been getting more and more interest from the industry – sustainability.

According to a recent study from the Commonwealth Fund, sustainability initiatives could save the healthcare industry up to $5.4 billion over five years, and $15 billion over 10 years. Those are some really big numbers.

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Year in Review and Look Ahead

This week seems like a good time to reflect back on 2012 and the healthcare industry. In a year full of newsworthy events, the Supreme Court’s ruling to uphold the Affordable Care Act stands out as one of the most notable. The high court’s decision ended speculation and provided forward direction and greater clarity for the healthcare industry.

The impact is felt widely throughout the industry and by all healthcare executives. I recently read an article by HealthLeaders about itssecond annual CFO Exchange. For the exchange, HealthLeaders brought together 30 finance leaders from hospitals and systems nationwide for a discussion about how their organizations were “tackling some of the more demanding healthcare mandates in history while maintaining a grip on their purse strings.”

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Transportation Steps into the National Healthcare Spotlight

Earlier this month in Healthcare Finance News, an article called “8 kinds of waste driving healthcare costs” really caught my attention. I was pleased to see that healthcare transportation has become part of the national healthcare dialogue. Marc Hafer, author of the book Simpler Healthcare, shared his views on eight different areas that could “inhibit patient flow, add cost, increase poor quality and infection and decrease patient and clinician satisfaction.”

First on the list: “transportation.” We know from our discussions with healthcare supply chain managers that transportation is not a core competency of healthcare systems or providers. But, while many organizations outsource many other areas (laundry, food service, EMS), a large number continue to retain their own transportation operations, often with minimal technology for tracking.

But perhaps the tide is turning.

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A Change in the Wind

I suspect many of us in this industry have been having the same types of conversations over the last three weeks.  Now that the Affordable Care Act (ACA) is moving forward, we all will continue what will certainly be a long journey towards changing the way healthcare does business.  Value-based purchasing, creation of accountable care organizations and national bundled payment pilots will force healthcare to strike the balance between cost and quality, without sacrificing either.

To me, this change in how we do business means that some of the truths we have always known need to be challenged.  For example, in the purchased services world

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A Common Sense Approach to Business Strategy

I read a blog post recently that I found very insightful.  This blog from the  Harvard Business Review, reflected on the fact that all too often, management’s first instinct is to attack issues by redrawing the organization chart.  Instead, it is suggested, they should look at the inner workings of the company including decision rights, information flow and motivators to understand the “DNA” that makes up their organizations.

As an example, they discuss a company that in the early 1990s had disappointing company performance. Under a restructuring plan, costs fell by 18%, but over the next 8 years, those same layers that had been cut out, crept back in.

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