Question

How does the claims processing portion of health care affect the overall profitability of the facility?

Answer 1

Health care facilities these days face many challenges in terms of economic ressession, uninsured patients , increased demand of out patient services , health care insurance policy patient etc. When a patient uses his insurance to pay the charges of hospitalisation , the patient has to apply for the claim ,then it will take some period of time to get the money reimbursed to the hospital . Overall the facility get the payment after claim is approved , untill there is any delay . Some of the affects of claim on the profitability of facilities are :-

- incomplete reimbursement

- delay in the payment

- some of the procedures are not included for the payment

- some of the vendor /company of drugs or equipments are not considered by insurance company, lead to incomplete payment

All these affect the facility and had to take money from external sources to pay the vendors.

For increasing the profitability of the facility ,we should focus on the principal / area of reduction of cost and increase the reimbursement and the revenues. The strategies to increase the profitability are :-

- reducing staff cost by using data to drive staff decision.

-reducing the supply cost by better managing the vendor

- ensure that the OR's are used effectively by the Physician.

- involve physician in cost reduction efforts

- consideration of outsourcing the management of some services

- partnership with local Physicians to reduce the competition of out patient services.

- consider adding profitable service line

- consider hiring hospitalist to inpatient care.

- renegotiate managed care contracts