In the past and currently cost accounting for our products (service units of output) have not been used as a measure of quality or payment. Therefore all the incentives are negative by forcing health care to be creative in picking the right codes to maximize our revenue streams that trend to being inadequate because of the imposition of more and more overhead costs related to the regulatory nightmare are designed to keep the patients and families in the dark … then blame us for being inefficient, ineffective and committing fraud and abuse.
Ironically this is not a political issue it is a national problem. And it will take the private sector to solve it.
Obama Care is a symptom not the problem. The problem is us … we continue to let the buyer dictate this heresy and blame us for not implementing it correctly. Obviously, ACO’s, population health and bundling is a move by the professors who run health care to force us towards episodic bundles for the entire continuum without proper preparation and standardization of services. It is their expectations and authority that the private sector will claw down costs just to survive another failed attempt to avoid doing it right.
What can you do to be a part of the solution? The way to win the Monopsony Game (the one buyer market we now have) is as follows:
Integrate standard cost accounting principles into your operational systems.
- Engage a cost accounting expert that also is an expert in Medicare, Medicaid and Private Pay
- Utilize government funding for meaningful purpose software to gear up for episodic payment
- Utilize preadmission costing to negotiate ACO’s and network contracts … be the leader not the follower.
- Utilize the Cost Manager software to assign the workflow, establish the workload and document the outcomes for accountability.
- Optimize revenues through forecasting episodic margins and length of stay and economize costs through point of service measurement of the labor utilization
In summary, this is what my company can bring to your team. Go to www.episodicpricecost.net for our approach to making a profit on the outcome not inadequate income on per diems. Jerry Rhoads, CEO Caregiver Management Systems, Inc.
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