How to Strengthen Hospital Market Positioning Using Performance Intelligence Data

Health system and hospital leaders utilize performance intelligence data to give them an advantage in each of these areas, especially in competitive markets. Knowing not only your own system/hospital performance, but also the performance of your peers, creates opportunities for higher demand, higher procedure payments, and prompt performance improvements – all of which lead to revenue growth.

Defining Episodes of Care

When assessing performance, many health systems are utilizing episodes of care to evaluate procedures or service lines. An “episode” refers to the combination of a triggering procedure and any wrap-around services across the continuum of care, regardless of who/where the services were provided. This term is applied ubiquitously across the industry and there are many episode definitions. The addition of wrap-around services better reflects the patient experience in addressing a given health need, and allows for better outcomes comparisons. There can be many nuances when defining an episode, however there are a handful of widely accepted principles that should be considered:

• Apply episode time bound definitions that look beyond specific codes in isolation, but instead chart out holistic care needs
• Find episode definitions that are validated by physicians and external experts
• Utilize episodes that comprehensively cover clinical activity across all sites of service
• Prioritize open source, transparent methodologies that allow insight into the analytics

By utilizing episodes that satisfy these principles, hospitals and health systems can fully understand their patient care journeys and track their performance across critical service lines and procedures against peers.

Better Understand Markets and Increase Patient Inflow

In order to drive more volume, and in turn more revenue, to hospital-owned providers, leaders need visibility to the full utilization within a market. For example, understanding the utilization and referral patterns of risk-based providers can present opportunities. As more and more providers transition to risk-based contracts, they are incentivized to send patients to the most efficient, highest quality facilities and specialists. Health systems can either wait to capture referrals in a passive manner or, they can proactively develop relationships with risk-bearing entities to entice more procedure volume. To make this case and develop the risk relationships, health systems and hospitals can use data to show why a relationship with them is better than their competitors based on metrics like experience, specialization, cost, and quality.

Fill out the form at the top of this page to find a data dashboard comparing health system performance across the Philadelphia CBSA for select episodes of care. In this sample visualization, you can see that Main Line Health owns the greatest market share for knee replacements at 33%, while the University of Penn Health System owns the majority share of cardiac catheterizations at 31%.

Advocate for Advantageous Fee Schedules

Another key application for performance data centers around health system fee schedules. For those not familiar with the health system world, reimbursement rates for any given healthcare service (outside of Medicare Parts A and B) are negotiated between plans and systems. These can vary quite significantly by geography, entity, and other factors.

From a health system perspective, it is important to enter into these negotiations as well-equipped as possible. Arming yourself with data on performance, as well as competitors, is the best way to ensure you enter these negotiations confidently. Some health systems may anecdotally know they are market leaders, especially across specific service lines, but it is often difficult to demonstrate the difference against competition. In comparing episode data across a standardized dataset, a health system can objectively advocate for the differences across their episodes of care versus those at other systems. They can then push for more favorable rates at their facilities and systems by episode of care, reflecting better “total cost of care” and clinical outcomes.

Returning to our visualization, we can see the observed cost variation for the Philadelphia market across episodes.¹ While reimbursements will vary by payer and negotiation, the use of objective Medicare data allows health systems to hold other variables constant, supporting more accurate baseline comparisons across competitors. For example, we can see a $6K range in hip replacement costs, from a low of $15K at Abington Memorial to a high of $21K at Pennsylvania Hospital of UPHS. Additionally, we could further drill into this data to understand if the differences are related to whether the procedures were performed primarily in the inpatient, outpatient, or ASC setting.

Identify and Fill Performance Gaps

A final application of episode data centers around performance gaps. The ability to drill down across episodes allows systems to identify areas of opportunity. Specifically, it allows health systems to incentivize high performers, coach providers on opportunities, and understand trends driving performance across key metrics. While the data in the visualization focuses on cost efficiency, one could similarly understand their performance on quality and outcomes measures. Systems can then evaluate whether these gaps can be addressed internally. Conversely, it may highlight opportunities for acquiring a new group or facility to fill the gap. In this blog, we show drilldowns to the hospital-level, but additional CareJourney data can evaluate performance by place of service, service line, or even physician.