I recently wrote a blog post called The Value of Care: The Secret Sauce in which I talked about the importance of having transparency of data. Costing is an evolutionary process perhaps starting with one type of procedure, one clinic or one service line or perhaps starting with a hybrid of costing methodology. The great news is that the beauty of technology can help realize the goal of improved costing by allowing for the use of multiple costing methodologies with full traceability and transparency to the underlying data.
Transparency of data and the ability to perform micro-level costing are both features that are missing from most cost accounting software today. Having data doesn’t itself make a company successful; organizations must act on information and filter what is useful, appropriate and above all else, actionable. Correlating data from a clinical and financial perspective provides a linkage between price and cost as well. There are many factors that influence price setting, not the least of which is the federal government (Medicare/Medicaid), but one reason that hospitals don’t more closely link pricing to margins is that they lack visibility into their own data.
There are several different types of data necessary to achieve transparency and each of these data types are vital to the decision support system to answer tough questions such as:
- How is your organization using cost of care insights within the quality management strategy?
- What is the cost management vs. margin accountability strategy?
- How is your organization using cost of care insights within your population health strategy?
- What cost management data are needed to for shared risk contract negotiations, price setting strategies?
Provider organizations will require discipline to bridge operational and clinical functions – including collaboration from the CFO, finance staff, CMO (Chief Medical Officer), CNO (Chief Nursing Officer) and division/department administrators – to consider quality, safety, patient satisfaction, and financial performance simultaneously. Additionally, some organizations may need to significantly and fundamentally rethink operations and what services and businesses are core to their mission. New productivity measures may emerge and new and different uses of technology may emerge. There is a fundamental culture shift that will require collaboration and significant leadership to see it through to completion.
The Perficient High-Performance Costing Expressway provides a complete solution that enables hospitals to rapidly deploy a micro-level costing solution. It provides integrated software and hardware with a prescribed set of data integrations and services to quickly deploy a costing application. The Perficient High-Performance Costing Expressway leverages Oracle’s Hyperion Profitability and Cost Management (HPCM) and the Oracle Healthcare Foundation to provide an unified healthcare analytics platform for decision support.
The Value of Care: The Secret Sauce is just one of the healthcare enterprise performance management trends. In our new guide, we take a look at six performance management trends healthcare executives need to be thinking about in 2016 and beyond. We’ll identify technology strategies and solutions that will help healthcare organizations succeed in a data-driven, cost-management culture.