I hear a lot of complaining and expect to hear more in the near future. In December 2013 I forecasted that 2014 was going to be a tough year for healthcare professionals. So far and based on the numbers I’m seeing I was right. Not everyone is hurting, no pun intended, as some wise healthcare professionals who have listened are doing better than the average but overall is not looking good.
Lets’ consider the facts:
- Weather. We have faced one of the most challenging winters in many years. Schools have closed; businesses have shut down and in some areas commerce have ground to a halt. In fact, we could say that the weather has resulted in a quarantine of sorts which by default prevented cross contamination of germs which by default reduced the number of patients needed medical services. Another consequence of the same is less money to go around. Just go ahead and figure it out based on the previously information provided.
- Healthcare Reform. Reduction in networks by insurance companies, higher deductibles, lower reimbursements, more expensive plans and a different kind of patients without insurance are some of the effects of healthcare reform.
- Cost of doing business. Have you noticed that everything is more expensive? I was actually looking at some of the items we resell and realized that my wholesale costs in some items is getting close to the reduced price I was charging. Good thing I caught it or I would have been losing money without noticing in a short time period.
- Legislation and rules. How many of you have conducted a HIPAA Security Risk Analysis? I have done quite a few and a couple of things I can tell you about them are:
o They are not easy or cheap;
o After you are done with the Security Risk Analysis comes the real work in the form of the Security Management Plan.
o Risk Analysis and Security Management are HIPAA Security, Omnibus Rule and Meaningful Use requirements;
o Even Business Associates must comply with these rules.
o In short, the increased requirements imposed by Legislation are increasing the overhead of all healthcare professionals and Business Associates so my cost of doing business is increasing.
- PQRS. If you don’t know what this is you are either blessed or lost. Anyways PQRS is another way to report data to the Federal Government and depending on your specialty your reimbursement may be reduced if you fail to do so.
- Electronic Health Records (EHRs). EHRs are not perfect nor have they matured to the point of making our life simpler. I do not want to be critical about this new technology as I own a company that created one of these products but overall many of our colleagues do not speak kindly of this “innovation” and have decided to settle after trying two to three different systems.
- Meaningful Use. By now I know of quite a few Practices and Organizations that have received the incentive for meaningful use. However; quite a few of them simply attested to information they have no clue about. Also, beware of EHR sales people who say that their system takes care of all Meaningful Use requirements as I found out this statement to be false in every single case I looked into. Also keep in mind that failure to be truthful in your meaningful use attestation is equivalent to fraud regardless of whether you knew about it or not.
- ICD 10. The impact of ICD-10 is going to be massive and most people don’t understand this yet. At the very least consider that even every Insurance company is going to have a different algorithm to process payment and while there is a possibility that all some of them will use the same language the order of operations or verification process are more than likely going to be different. All I’m writing about is software operations and intercommunications between different parties. Anyway, the end result is going to be an exponential increase in denials until everyone figures out what and how.
Looks bleak but it doesn’t have to be so. My recommendations to mitigate or overcome these issues are quite simple:
1. Get a line of credit ASAP. If you don’t at least have liquid assets to cover your expenses for at least six months;
2. Diversify your income. Even if everything you do is healthcare related consider different sources of revenue;
3. Stay informed. Learn the rules or get someone to advise you as misinformation is plenty and this is not a time to learn by mistakes;
4. Plan ahead. The time to buy lifejackets is not when your ship is sinking. Analyze your situation, consider how the changes will affect you and take control by drafting a plan of action.
I realize that there is a lot going on in healthcare, it is not going away. It’s just going to be a little more challenging and it will require some true business expertise.