How Referral Management Systems Prioritize Patient Leakage to Tackle the Biggest Threat to Network Success
*** The following is an excerpt from our Network Intelligence Playbook .
Fibroblast recently commissioned a study of 100 healthcare executives to gain new insights into how healthcare executives perceive the problem of patient leakage and how they are using referral management systems to address it.
THE SURVEY HAD FOUR KEY FINDINGS:
1. Addressing patient leakage is a high priority for 87% of executives. However, 23% currently don’t track leakage and another 20% don’t understand where or why it occurs.
2. Too much revenue is at risk due to the high cost of leakage: Patient leakage hurts the top and bottom line with nearly half (44%) of executives reporting that they’re losing 10% or more of annual revenues due to patient leakage. Even more troublingly, another 19% are losing over 20% of revenue due to leakage — and almost one-quarter (23%) don’t even know how much they are losing.
3. Shared responsibility without clear ownership contributes to inaction: While leakage was ranked as high priority by survey respondents, 69% of executives also shared that the responsibility for tracking and managing leakage is assigned to more than one person in the C-suite. Similarly, survey respondents said that their organizations had not established or broadly communicated specific, measurable goals for reducing leakage.
4. EMRs fall short but still persist as default option: While EMRs are the default option for referral management, 76% of executives reported being either not satisfied with their EMR’s referral management capabilities and ability to help reduce leakage.
As the survey showed, executives acknowledge that a great deal of revenue is at risk from patient leakage — and they are right. However, it can be hard for healthcare organizations to quantify that loss in the real world. To illustrate the full implications of leakage for the lifetime of care, Fibroblast conducted an analysis of Medicare Shared Savings Program Accountable Care Organization (MSSP ACO) data for over 5 million referrals, representing almost 90,000 patients.
HERE’S WHAT THE ANALYSIS REVEALED:
- An average patient leakage rate of just over 14 percent: At first glance, that doesn’t sound too problematic, since just over 85% of patients are staying in the network. However, our analysis went deeper to determine the downstream financial impact for that seemingly low 14% of patients. As we see from the other findings, the numbers quickly go from a minor issue to a major catastrophe.
- The initial impact of one out-of-network referral: That first-order leakage, meaning when one patient gets referred out of network by one provider, costs the ACO on average $60 million a year in professional services fees from initial consultations alone.
- But there is much more than one referral at stake: Once patients have been referred out of network, they often consume subsequent care besides just a single specialist visit. For example, they may get an MRI or have lab work done. They might need to have a procedure, like a colonoscopy or knee replacement – which will likely be done out of network as well. The analysis found that the subsequent care represents a further loss of $326 million on average.
- Losing the lifetime of care has a massive downstream impact: When patients consume care out of network, they pose a larger threat to short and long-term revenue. They may build strong relationships with the new provider or be highly satisfied with the patient experience. As a result, they may decide to receive subsequent care like annual well visits, for them or their family members, from the out-of-network providers. Then, one lost referral becomes much more. It becomes the loss of the patient for a lifetime of care. As the analysis found, that missed opportunity is almost $500 million annually.
HOW FIBROBLAST CAN HELP
Fibroblast is a referral management system that fixes the broken referral process by empowering providers with easy-to-use, end-to-end tools that actively manage referrals. By closing the referral loop, it prevents patient leakage, increasing revenues for fee-for-service organizations and lowering risks for accountable care organizations to deliver a clear, compelling return on investment. Our provider-patient matching algorithms deliver critical network, quality, cost, and accessibility data to the point of care, and the workflow can be embedded in existing EMR workflows or deployed as a stand-alone web application. This allows providers to manage referrals across a provider network where EMRs may not otherwise connect, all while guiding referrals to highest value in-network providers.
For more information, or if you have any questions, contact us at email@example.com. You can also find out more with Fibroblast Insights.