September 19, 2021 Comment off
This Discussion offers you the opportunity to apply return on investment (ROI) concepts in a real case scenario.
Cost Savings and Revenue Enhancement
Dear writer This is an one page essay, please read and do as required , using the scenario provided and the resources attached. Bellow is the details of the work. This Discussion offers you the opportunity to apply return on investment (ROI) concepts in a real case scenario. As is often the case, technology offerings involve costs that must be justified by virtue of expense reductions for revenue increases in the organization. There are creative opportunities in the Discussion for leaders to facilitate the development of the revenues into the organization and operational changes that reduce expenses. Scenario: Dynamic Health System is a 3-hospital, 500-bed system in the Midwest United States. This system employs 100 physicians, both primary care and specialists, in 12 physician practices. Dynamic also runs a center of excellence in orthopedic care for the large geriatric population in the area, including an outpatient rehabilitation facility that is currently profitable. Dynamic offers a full spectrum of medical and surgical services to their population with an emphasis on programs of excellence in orthopedic surgery, diabetes, and womens care. Dynamics typical patient mix is over 45% Medicare with another 35% private pay patients covered by three large insurance companies. Their Medicaid population is approximately 12%, with the reminder of patients self-pay. Due to market forces, the three private payers have begun to implement a program of bundled payments for their members in the following areas: hip replacements, knee replacements, and lower back surgeries. In these models, Dynamic hospitals and employed physicians will be paid a fixed amount for an entire episode of care from pre- surgery evaluation, through surgery and post-surgery, physical therapy, and rehabilitation. Medicare is likewise proposing a pilot study for a population of hip replacement beneficiaries to assess the outcomes of care as opposed to procedure costs as a result of Dynamics petition to receive increased payments for beneficiaries due to age demographics and for being the only orthopedic geriatric center in 200 miles. As a result of these factors and the aging HIT infrastructure, the Chief Medical Officer (CMO), Chief Executive Officer (CEO), and Chief Information Officer (CIO) of Dynamic are proposing the purchase of a monolithic Electronic Health Record (EMR) solution that will provide complete online documentation, orders, pharmacy, labs, and patient portal for all hospitals and employed physician offices. Because the (1) physician offices are currently using Epic Corporations back office billing system with an outstanding record of accurate coding and short days in Accounts Receivable and (2) Epics EMR has a high ranking in industry HIT assessments, the executive team is proposing the purchase of Epics clinical EMR (documentation, ancillaries, orders, and patient portal). The CFO is supportive but skeptical, as the Epic bid is approximately $1.5 M to implement the clinical software with a continued $300K per year in software maintenance and support. Current clinical technologies information systems are fragmented, disjointed, and dont meet HITECH Meaningful Use requirements, and it will cost Dynamic about $200K per year to maintain the software and servers needed to run the system. The local competitive landscape may be changing. Dynamics CFO is hearing rumors that an established academic system which is centered 300 miles away is possibly considering buying three local stand-alone surgery centers and hiring orthopedic surgeons. This academic center has published best practices in outcomes for surgery care in a recent CMS Medicare study that implies that they are delivering high quality and cost effective orthopedic care. To prepare: Carefully read the scenario and the Pro Forma Explanation Material in this weeks Learning Resources. Develop a return on investment (ROI) strategy for the acquisition of a strategic HIT solution in which you consider 23 cost saving and/or revenue generating opportunities that you feel apply to Dynamics scenario. By Day 3 Post: A strategy for how Dynamic can pay for the newly proposed Epic system. Explain how the organization will save in operational expense in order to handle the extra 100K per year needed to maintain this solution. Provide a recommendation for how the hospital can use HIT solutions to generate new revenue. Also consider that if Dynamic issues a bond to pay for the $1.5 million implementation costs, likely the local rating agencies will want to see a documented 510% additional reduction in hard line operating expenses to assure Dynamics ability to pay off the debt. Given that over 60% of the operating budget is staff and physician salaries, explain what kinds of savings the best in class EHR offer will assure investors.