A majority of the healthcare providers in the United States suffered financial decline in 2017. Shift towards value-based care system is one of the key factors affecting health of hospitals; however, health networks' pain points vary widely, from a broad shift toward consumerism to talent shortage. A majority of these challenges can be segmented into four broad categories – regulations, capex on technology, incorrect / non-payments and risks such as narrow networks.

Healthcare providers need to tackle problems on multiple fronts to move toward a solution, which must include elements of process improvement, people management, technology enhancement, and ecosystem development.

Contents

This report examines the challenges faced by healthcare providers in the market today and gives solutions to some of these problems. Additionally, sourcing implications arising out of these challenges are also reviewed in the report.

Some of the findings in this report are:

• Obama-era regulations, such as MACRA, and GOP-proposed / -passed bills are putting pressure on hospital margins, with MACRA alone likely to cause a decline in hospital Medicare reimbursement of at least US$250 billion by 2030
• Massive investments into extremely expensive EHR systems with little or no preparedness and vision, leading to poor financial performance
• Continuing fraud, lack of education, and CMS’ inability to address these issues has resulted in doubling of improper payments in past five years, with 2016 reaching ~US$102 billion
• Claims denials totaled more than US$250 billion in 2016 highlighting the payment risk significance for hospitals
• A large part of healthcare providers’ financial challenges stem from inefficient processes (especially front-end) and ineffective care management initiatives; hence, focus on these two segments
• Hospitals should hire visiting physicians/nurses, link incentives with performance, and collaborate with specialists for training purposes to enhance people management
• Technology investment is a must; however, hospitals also need to sort out issues regarding technology illiteracy and improper implementation before achieving ROI
• Increased demand for care initiatives, population health, telehealth, and patient engagement-focused activities
• Learning and development initiatives will increase
• The healthcare provider outsourcing market is highly competitive, with specialists, IT/BPO service providers, and technology vendors

Membership(s)

Healthcare & Life Sciences Business Process Outsourcing