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
    sailing health benefits
    Essential Gear to Enjoy the Health Benefits of Sailing
    March 7, 2024
    Gut Health in Athletes: Nutrition, Hydration, and Performance Optimization preview
    Gut Health in Athletes: Nutrition, Hydration, and Performance Optimization
    June 6, 2024
    healthcare facility expansion is to carry out a complete needs assessment
    How to Implement Strategic Facility Growth Planning for Healthcare Centers
    August 11, 2024
    Latest News
    5 Steps to a Promising Career as a Healthcare Administrator
    August 3, 2025
    Why Custom Telemedicine Apps Outperform Off‑the‑Shelf Solutions
    July 20, 2025
    How Probate Planning Shapes the Future of Your Estate and Family Care
    July 17, 2025
    Beyond Nutrition: Everyday Foods That Support Whole-Body Health
    June 15, 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
    Hurricane Preparedness Tips for Older Adults & Caretakers
    September 17, 2012
    A Doctor Pans Electronic Health Record Incentives
    December 24, 2011
    Heart Disease Prevention
    Fighting Heart Disease Using the Web: 3 Tips for Success
    November 20, 2012
    Latest News
    How IT and Marketing Teams Can Collaborate to Protect Patient Trust
    July 17, 2025
    How Health Choices and Legal Actions Intersect After an Injury
    July 17, 2025
    How communities and healthcare providers can address slip and fall injuries with legal awareness
    July 17, 2025
    Let Your Lawyer Handle the Work Before You Pay Medical Costs
    July 6, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: The Healthcare Conundrum: Doing What’s Wrong for Business by Doing What’s Right
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 > The Healthcare Conundrum: Doing What’s Wrong for Business by Doing What’s Right
BusinesseHealthFinanceHospital AdministrationMedical Records

The Healthcare Conundrum: Doing What’s Wrong for Business by Doing What’s Right

Bill Crounse
Bill Crounse
Share
5 Min Read
SHARE

I read with interest this morning an article by Erin McCann, Associate Editor at Healthcare IT News. Ms. McCann shines a bright light on the sad fact that under today’s reimbursement system, better care doesn’t always yield better business results.

I read with interest this morning an article by Erin McCann, Associate Editor at Healthcare IT News. Ms. McCann shines a bright light on the sad fact that under today’s reimbursement system, better care doesn’t always yield better business results. That’s because healthcare organizations aren’t incentivized to eliminate profitable procedures (tests, medical imaging, and surgeries) that may not benefit patients.  And under the way most hospitals and clinicians are paid today, why would we expect them to do otherwise?

reimbursementThe article was timely since just yesterday I met with executives of a very large, not-for-profit multihospital system at our Microsoft briefing center in Redmond. Despite having all the technology needed to provide health services in entirely new and more efficient ways, the hospital system finds itself incapable of implementing and using many of these technologies and solutions. First and foremost they, like most American hospitals, are in the midst of implementing an EMR/HIS solution upgrade, in this case across multiple facilities. It’s an absolutely essential initiative that lays the ground work for a more digital future. It also comes at a cost that approaches a billion dollars. What concerns me is that, while necessary, the system-wide EMR/HIS initiative doesn’t by itself change medical practice all that much if at all. And so long as the system is held hostage to a payment system that rewards volume rather than value, it’s quite possible that much of the technology they already own that could truly transform the way they deliver care, will never get used. If they only get paid for doing things the way they’ve always done them, why would we expect change?

This is a conundrum not just for American hospitals and clinics. I’ve seen it play out in many other countries around the world, including health systems that we Americans might consider quite socialized.  Even in these countries there is often a disconnect between the payer of care (government plus or minus private insurance) and the organizations and clinicians who deliver care. One would think that if government could save money by delivering health services more efficiently, technologies that would make that happen would be rapidly deployed. But that is not the case often because the organizations and clinicians delivering the services are incentivized (paid) to keep doing things the way they’ve always done them.

More Read

heart of doctor empathetic listening
7 Things Doctors Should Know About the Value of Content Marketing
Future of Telemedicine Is Bright
Three Central Questions About Medical Technologies
How to Improve Healthcare: Address Super-Utilizers
Using Social Media to Market and Brand Your Medical Practice

health ITI recall a well-known, high quality health system here in the Pacific Northwest that wanted to deliver better, more cost effective back and joint care to their patients. The objective was to not only provide better care to their patients, but also lower costs to major self-insured employers in the area. Back and joint problems are a leading cause of time loss from work, disability, and high medical costs. The doctors discovered that thospital administrationhe majority of the patients they were seeing didn’t need expensive imaging studies. Instead they focused on rapid clinical evaluation and immediate referral to high quality, intensive physical therapy.  In other words, they were doing what they knew was best for patients, and it turns out, their employers. Of course, there was a significant cost to the health system for doing the right thing. That cost came from trading a high volume in very lucrative imaging studies for much lower cost physical therapy sessions. The system initially lost a ton of money by doing the right thing.

Most hospitals and health systems operate on pretty thin margins. They don’t have the luxury of killing a cash cow–being able to turn away paying customers (patients) from expensive tests and procedures. By doing so, they are literally shooting themselves in the foot.

Nothing much will change until payors (public and private) around the world remove the perverse incentives that stop innovation in healthcare delivery dead in its tracks. We’ll never be able to transform health and healthcare with eHealth, mHealth, tele-health, telemedicine, and so many other technologies that could help clinicians deliver higher quality, more convenient and cost effective care until we finally and fully address this all too common conundrum in healthcare.

TAGGED:EMRHealth ITHISreimbursements
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

technology in medical research
The Tools Helping Medical Researchers See the Full Picture
News Technology
August 3, 2025
5 Steps to a Promising Career as a Healthcare Administrator
5 Steps to a Promising Career as a Healthcare Administrator
Health
July 31, 2025
holistic dental
Holistic Dentist Services Are Natural and Safe
Dental health Specialties
July 28, 2025
botox certification
Help Improve People’s Skin Health Via Botox Certification
Skin Specialties
July 22, 2025

You Might also Like

Egghead_300-451
BusinesseHealthHospital AdministrationSocial Media

“Don’t Be an Egg-Head” and Other Social Media Lessons [PODCAST]

December 23, 2014
medical billing
FinanceHealth ReformHospital AdministrationPolicy & LawPublic Health

HHS Secretary to Create Transparency Mechanisms to Address Medical Billing Costs

May 9, 2013

Specialty EMR Company Lands $14M to Take on New Markets

August 21, 2013
healthcare disruption
BusinesseHealthMedical InnovationsTechnology

Healthcare: Get Ready to Shake, Rattle and Roll

April 17, 2014
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?