Healthcare leadership is challenged daily to make informed decisions, cutting off wasted resources while ensuring safety and satisfaction in the Patient Journey. One way this is periodically re-evaluated is through EHR Data Analysis: pulling data and looking at patterns and areas for improvement. It uncovers the bigger picture in a large ocean of data enabling healthcare leadership to hone processes but we should expect more than just the ability to run queries and get a basic visualization from data. A Streamed Data Analytics platform takes this to the next level.
Intelligent software is revolutionizing lean process improvement, getting actionable insights into our hands faster than ever before and on a continual bases. The goal is to support a growing need to expand the capacity for the human brain, break down variables and uncover hidden trends in data down to the hour of the day. Results and recommendations for change are now backed by Data Science employing Artificial Intelligence, Machine Learning and predictive analytics and are not from long process trial and error. Have you ever wished you could connect your data to the minds of mathematicians? By doing so, you can learn, for example:
Who is coming into my Emergency Department?
When are they coming?
Will I have what they need?
What will I do if I don’t have what they need?
When the above questions are answered, you clear the way for happier healthcare professionals, more satisfied patients and optimal care. Streamed data analytics software like Bernoulli Optimizer exists and gives powerful insights into the health of your hospital through granular EHR data analysis in a faster and more cost effective way. You could, for example, process 6 months or 6 years of data, with insightful analytic reports and corrective recommendations in a matter of weeks rather than months or greater. Target specific goals or pain points like, “what is the best time to start/end a shift?”, “What is the average Length Of Stay for ESI3 patients?” or allow the engine to identify and refine optimization opportunities from your data by your of the day, week, month, year.
Sound vague? That’s because the capabilities for types of data that can be crunched are endless. Provider functionality, staff/patient ratios, patient flow, number of beds, ESI variability, multi. department process, etc. This data can be gathered and processed now, however, until recently, it took months to retrieve because collection and the process to make sense of it was manual. Optimization engines powered by AI, Machine Learning, and predictive analytics automate production of data analysis to produce useful, analytic reports. It turns data into actionable insights faster.
Pair the data with leadership teams, internal lean teams or a contracted lean consulting firm to get the answers you need right now along with best practice recommendations for how to use it. Forgo the lengthy trials to “see” if a change works and use a what-if simulator to put the change into action. Modeling and simulation will show you where the ripple starts and stops and enable continuous optimization within your ED and connecting departments.
Fitch: Small not-for-profit hospitals see biggest margin rebound
Not-for-profit hospitals’ and health systems’ median operating margins bounced back more than 10% in 2018 over the prior year following two straight years of margin declines, with the biggest gains concentrated at the low end of the ratings spectrum, according to a new report from Fitch Ratings.
The median operating margin was 2.1% in 2018 across the 220 not-for-profit hospitals and health systems Fitch rates, compared with 1.9% in 2017. Within that, AA-rated providers saw their median operating margins decline from 5.1% to 4.5% during that time. At the other end of the spectrum, providers rated BBB- saw their margins improve from -1.2% to -0.7%.
It’s a “very good sign” for the industry that the lower-rated credits performed better, as they tend to be more vulnerable to the whims of the market than higher-rated systems, said Kevin Holloran, author of the report and senior director with Fitch.
“We’re not out of the woods yet,” he said. “But it’s important to note those smaller credits made the most meaningful gains. This shouldn’t be a flash in the pan. It should be an industrywide shift.”
Fitch still maintains a negative outlook for the not-for-profit hospital sector, as it has for about two years, but Holloran said the agency will likely revisit that in November or December. He thinks operating profitability bottomed out in 2017, and will continue to inch back up in the coming years.
“The main story this year was we did not see an across-the-board degradation of margins,” Holloran said. “We saw the industry pick itself up by the bootstraps.”
Hospitals and health systems at the lower end of the rating spectrum tend to be nimbler and can implement changes more quickly than larger systems, which tend to be perpetually digesting mergers or other bold changes that draw time and expertise away from fundamental operations, Holloran said. And since lower-rated systems tend to be smaller, even minor gains or losses have a meaningful impact on their overall operating results.
As far as why operational strength is returning to the sector, Holloran said it’s just because they’re doing the “basic blocking and tackling.” They’re getting better at controlling salary and wage costs by staffing people at the top of their licenses and using less traveling personnel, he said. They’re not overstaffing if volume does not require it. They’re not paying overtime because staffing is at appropriate levels.
“That’s literally half your expense base,” Holloran said.
The other half is supplies, which invites questions over utilization practice patterns. How many suture kits are opened during surgeries? Can implants, sponges and gloves be purchased in bulk through a known vendor?
Addressing salary, wage and supply costs covers two-thirds to three-quarters of hospitals’ expense base, Holloran said.
Another crucial area is revenue cycle. Are hospitals billing appropriately? Are bills being denied or sent back?
These aren’t so much “initiatives du jour” as they are a way of life, Holloran said. “I would submit that we in the not-for-profit world have gotten a good dose of for-profit acumen shot into our DNA.”
Outside of hospitals’ own operations, market conditions are also having somewhat of an effect on margins, although that’s a more mixed bag. Low unemployment rates, lots of people getting employer-sponsored insurance and a positive economic environment are all good things. For hospitals, though, a strong job market can make it tough to retain nurses, technicians, coders and others. There’s also the ever-present threat of nontraditional entrants becoming increasingly interested in healthcare.
Margins for hospitals’ median operating earnings before interest, taxes, depreciation and amortization also improved from 2017 and 2018, from 8.5% to 8.6% overall, with the biggest improvements seen in the lowest-rated systems. Systems rated under below investment-grade categories saw their operating EBITDA margins grow from 4.1% in 2017 to 5.8% in 2018. At the other end of the spectrum, all AA category credits did not see a change in their operating EBITDA margins during that time, which remained at 9.9%.
Data from Modern Healthcare Metrics, which aggregates information from the Medicare cost reports that hospitals submit to the CMS annually, identified a decline in median operating margins across not-for-profit hospitals in the years Fitch studied. In 2018, Metrics data show the median operating margin was 3.1% across 1,119 not-for-profit hospitals. In 2017, it was 3.3% across 1,943 not-for-profit hospitals.
Fitch’s new report, 2019 Median Ratios for Nonprofit Hospitals and Healthcare Systems, did not include data on children’s hospitals or hospital districts.
The report notes that hospitals’ liquidity metrics were stable between 2017 and 2018, although they’re at all-time highs for the industry. Overall median cash to debt dropped to 155% in 2018 from 159% in the prior year. Despite improved profitability, the BBB and below investment grade-rated systems saw declines in cash to debt, from 98% in 2017 to 91% in 2018.
50% of hospitals plan to invest in non-clinical AI by 2021, survey finds
Although most hospital leaders are unfamiliar with the specifics of automated technologies for data management, at least half plan on investing in the tech within the next two years, according to a new report.
The report, from Olive and Sage Growth Partners, concerns the use of non-clinical artificial intelligence and robotic process automation to increase efficiency in areas such as supply chain, revenue cycle, finance and human resources.
Here are three findings from the report, which surveyed 115 executives from hospitals and health systems across the U.S.
1. Only 50 percent of the leaders surveyed were familiar with the concept of non-clinical AI and robotic process automation; more than half were unable to name a single vendor or solution offering the technologies.
2. However, a total of 23 percent of the executives — a pool that included CFOs, CIOs, revenue cycle managers and supply chain functional leaders — said they are already looking into investing in the technologies, and half plan to do so by 2021.
3. Plans for implementation differ: While just over 40 percent of respondents said they would prefer to hire an outside company to build, deliver and support automation, one quarter of those surveyed planned on choosing an automation platform themselves, then hiring external consultants to build it; just 18 percent said they would both choose and build the platform internally, and 13 percent plan on outsourcing the entire process, from choosing a platform to building it, to consultants.
Twitter Word Cloud –
The most utilized keywords for healthcare related twitter searches August 19th – August 23rd.
60% of payers, providers plan to allocate funds to predictive analytics
Link to original article in Becker’s Hospital Review
Payers and providers plan to put their money toward predictive analytics, with a majority of them — 61 percent — expecting the investment to pay off, according to the 2019 Predictive Analytics in Health Care Trend Forecast survey conducted by the Society of Actuaries.
Of those surveyed, 60 percent of payers and providers said they plan to dedicate 15 percent or more of their spending to predictive analytics this year. Many of these respondents predict that investments in predictive analytics will save their organization 15 percent or more over the next five years.
Executives are also getting in on predictive analytics. Sixty percent said they are using predictive analytics within their organization, which represents a 13-point year over year increase from 47 percent in 2018.
When it comes to predictive analytics, 23 percent of payer and provider executives believe the future lies within data visualization, while 16 percent are focused on machine learning. However, to achieve success, organizations must overcome the problem of “too much data,” which 16 percent of providers said was the biggest barrier to implementing predictive analytics.
To access to full report, click here.
Twitter Word Cloud – The most utilized keywords for healthcare related Twitter searchers August 12 – August 16.