By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    healthcare cybersecurity
    4 Helpful Tips on How to Protect Your Medical Practice Against Cyber Attacks
    October 24, 2021
    Health Check Diagnosis Medical Condition Analysis Concept
    6 Health Woes With Online Remedies
    January 19, 2022
    Eight Things Men Should Know About the Male Menopause
    Eight Things Men Should Know About the Male Menopause
    April 24, 2022
    Latest News
    Beyond Nutrition: Everyday Foods That Support Whole-Body Health
    June 15, 2025
    The Wide-Ranging Benefits of Magnesium Supplements
    June 11, 2025
    The Best Home Remedies for Migraines
    June 5, 2025
    The Hidden Impact Of Stress On Your Body’s Alignment And Balance
    May 22, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    healthy nursing school habits
    Healthy Habits for Nursing Student Nursing School Students
    May 24, 2024
    High Deductables
    High-Deductible Insurance and Rising Bad Debt
    July 24, 2015
    How People Are Taking Advantage of Health Deals in the Recent Recession
    February 5, 2021
    Latest News
    Top HIPAA-Compliant Messaging Apps for Healthcare Teams
    June 25, 2025
    When Healthcare Ends, the Legal Process Begins: What Families Should Know About Probate and Medical Estates
    June 20, 2025
    Preventing Contamination In Healthcare Facilities Starts With Hygiene
    June 15, 2025
    Strengthening Healthcare Systems Through Clinical and Administrative Career Development
    June 13, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: 6 Forces Pushing Healthcare Outside Hospital Walls
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > 6 Forces Pushing Healthcare Outside Hospital Walls
BusinessFinanceHospital Administration

6 Forces Pushing Healthcare Outside Hospital Walls

tkilpatrick
Last updated: December 16, 2013 9:00 am
tkilpatrick
Share
5 Min Read
reimbursement models for hospitals
SHARE

reimbursement models for hospitalsWhile hospital success is primarily based on what happens within their four walls, their future depends on patients not in the hospital.  There are several new reimbursement models that have begun to tie as much as 50% of the hospital payment to what happens after patients leave.

reimbursement models for hospitalsWhile hospital success is primarily based on what happens within their four walls, their future depends on patients not in the hospital.  There are several new reimbursement models that have begun to tie as much as 50% of the hospital payment to what happens after patients leave. Hospitals will need to take on the new missions of successfully managing these new reimbursement models and helping patients outside the hospital.

Readmission Penalties – Medicare penalizes hospitals as much as 2% of their total inpatient Medicare revenue if there is a high rate of readmissions within 30 days after a patient leaves the hospital.  Medicare will increase the maximum to 3% beginning October 2014.  It is likely that other insurers will eventually tie a percentage of reimbursement to readmissions.

Spending Per Beneficiary – Medicare will begin penalizing up to 0.3% of inpatient Medicare revenue October 2014 based on the average “Medicare Spending Per Beneficiary”.  Medicare spends an average of $10,122 per inpatient stay and $7,984 during the 1 to 30 days after the patient leaves the hospital. This is a new component of the Hospital Value Based Purchasing program. This new metric is now publically available and is beginning to get scrutiny as to how it is calculated. Once the calculation is accepted, it will likely to be used by other insurers.

More Read

health IT
Health IT Thrives with New Startup Companies
Why Wellness Clinic Blogs Need Bylines and Bios
Pennsylvania House of Representatives Passes Medical Marijuana Bill
What Makes a Healthcare Website Shine?
Will ObamaCare Help or Hurt the Economy?

Bundled Payments – Medicare spends an average of $10,122 for an inpatient stay and approximately $10,000 during the period of 1 to 90 days after the stay. This could mean as much as 50% of the reimbursement will be tied to what happens outside the four walls of the hospital. The Medicare Bundled Payment for Care Improvement (BPCI) pilot of this model has begun and could be rolled out by October 2015. Many other insurers are leveraging the Medicare rules and regulations to introduce commercial bundled payments.

Accountable Care Organizations (ACOs) – ACOs take on the risk of the overall cost of a patient measured over 12 month periods. Over 250 ACOs have signed up for the three year Medicare pilot called Medicare Shared Savings Program (MSSP).  The private healthcare insurance industry has followed Medicare’s lead and guidelines by signing up 250 ACOs to similar arrangements for their enrollee’s 12 month costs.  Already 14% of the US population is being served by ACOs. Medicare is likely to offer beneficiaries financial incentives to join ACOs beginning in 2015. Insurers will likely follow by offering similar incentives to their members.

Employee Population Health – The typical hospital or healthcare system is one of the largest employers in their communities. Most are self-insured and responsible for the overall cost of their employees’ healthcare. Like other large employers, hospitals use employee financial incentives to get them to take health assessment and adhere to a health plan to improve certain conditions.  Large employers like Walmart offer employees’ discounts (or no out of pocket costs) if employees get services from hospitals that employers have negotiated directly for services.

Health Plans – 20% of hospitals or healthcare systems now offer some kind of insurance product to their communities and another 20% are exploring insurance options.  Narrow network insurance plans are also being developed to be offered in the new Affordable Care Act healthcare exchanges.

Hospitals will need to begin developing analytics, remote monitoring, remote care management, post-acute networks, utilization management  programs, clinical integration, medical records integration and population health programs. This will require developing many new relationships with insurers, providers and physicians.  Hospitals will need to be able to effectively manage patients outside their four walls and do whatever it takes to keep patients in certain reimbursement models out of their hospitals.

(reimbursement models for healthcare / shutterstock)

TAGGED:readmission
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

women dental care
What Is a Smile Makeover and How Much Does It Cost?
Dental health
June 30, 2025
HIPAA-Compliant Messaging Apps
Top HIPAA-Compliant Messaging Apps for Healthcare Teams
Global Healthcare Policy & Law Technology
June 25, 2025
recovering from injury
Rebuilding After Injury: Path to Physical and Emotional Recovery
News
June 22, 2025
scientist using microscope
When Healthcare Ends, the Legal Process Begins: What Families Should Know About Probate and Medical Estates
Global Healthcare
June 18, 2025

You Might also Like

Target Knows You’re Pregnant, Even if No One Else Knows

February 23, 2012
Dx Cost and patient Centeredness
BusinessDiagnosticsHospital Administration

Patient-Centered Physicians Have Lower Diagnostic Testing Costs

June 26, 2014
Service Fanatics
BusinessHospital Administration

Service Fanatics: Required Reading for Superior Patient Experience

January 9, 2015

European Diabetes Market

October 11, 2011
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?