Most hospitals are still operating in a fee-for-service world and cautiously sizing up the jump to value. However, the costs built into the healthcare infrastructure and thinning hospital margins make that jump look even more precarious. Hospitals need to maximize fee-for-service revenue while optimizing outcomes — and the simplest way to do this is through comprehensive clinical documentation, according to Anthony Oliva, DO, vice president and CMO of Nuance Healthcare CDI.
This content is sponsored by Nuance.
Dr. Oliva spoke Nov. 14 at the Becker’s Hospital Review 7th Annual CEO + CFO Roundtable in Chicago at an executive roundtable hosted by Nuance on the opportunities to transform clinical documentation and drive better outcomes.
Using advanced analytics and AI-powered guidance, hospitals can better utilize resources lost during the back-and-forth between the coding/revenue cycle and clinical quality teams by simply better identifying the severity of patient populations at the outset. This not only helps coders more accurately submit claims that align with patient outcomes, but it also helps ensure patient documentation reflects proper diagnoses and drives improved care sooner.
Trapped between curves
The healthcare industry is trapped between two curves like those described in Ian Morrison’s The Second Curve, Dr. Oliva observed.
In The Second Curve, Mr. Morrison makes the case that most industries experience two curves. In the first, when a product or service is new, the company that provides the product controls the supply and the demand. As consumers become familiar with the product and as technology advances, they begin to expect more from the product. This is the tipping point. Eventually, consumerism, technology and transparency will flip the industry into the second curve. Companies can either adjust or make way for others who will deliver what consumers want.
Dr. Oliva believes healthcare is teetering between the first and second curves. “There is often a misconception that we are being driven down this value road,” Dr. Oliva said. “I don’t think we are being forced down it at all. I think it’s a natural progression of the industry.”
This progression has been triggered by four main trends, according to Dr. Oliva.
- Cost. In the first curve, providers control the supply of care, and often the demand. They determine how and when patients need care for which conditions. This control has driven costs to an unsustainable high
- Informed consumers. The internet has flattened the playing field a little bit with regard to medical knowledge. Providers are no longer the gate-keepers of information, contributing to a greater push by consumers for care on their terms.
- Technology. Meanwhile, technology is improving, allowing procedures to enter lower-cost outpatient settings, which can also offer patients the convenience they want.
- Transparency. Reputation no longer reigns in healthcare. Patients have easy access to information on which providers are performing best.
Unlike attempts to control costs with managed care in the ’90s, these four trends combined have solidified the shift to the second curve, according to Dr. Oliva. “I don’t think the cat’s going to get back in the bag here.”
A marker of this shift is the steady drop in inpatient surgical cases due to better and more affordable care opportunities in the outpatient setting. Unfortunately, just shifting to an outpatient focus isn’t a cure-all for the financial challenges facing health systems. The costs of maintaining the infrastructure for inpatient care make it impossible to make up the difference in revenue. The math just doesn’t work out.
“We put so much into the healthcare infrastructure that it’s a very costly system we live in. We’ve been feeding the beast forever with fee-for-service,” Dr. Oliva said. The only way out is the move to value, rewarding providers for performance and outcomes. Yet value-based care only really exists in small pockets around the country. It’s far from the reality in most regions where hospitals are struggling to just stay afloat financially.
So, what’s the best way to mitigate the challenge created by being trapped between the two curves?
“It’s clear that clinical documentation improvement is that strategy because it’s managing what we currently have to the best of our ability,” Dr. Oliva said.
Why CDI is more important than ever
Comprehensive clinical documentation helps hospitals squeeze every drop of revenue coming in from a fee-for-service perspective. At the same time, claims are used to determine quality outcomes in a value-based care world — making accurate clinical documentation critical for success in the second curve.
“Outcomes and patient satisfaction have become more important, therefore the ability to measure the severity of the population just became more important, much more important,” Dr. Oliva said.
In a value-based care world, performance will be determined by comparing actual care outcomes over expected outcomes. Actual, or observed outcomes, have infinite factors. How long did it take for the patient to come to the hospital? Did they receive the appropriate medications? Were the correct protocols followed? Did they face long wait times? Did providers communicate well? Was there variation between providers? Addressing these factors is the aim of the second curve.
Expected outcomes are controlled by patient age, principle diagnosis and secondary diagnoses. In other words, the care hospitals provide is not immediately relevant to the expected outcome. In the transition between curves, optimizing expected outcomes through proper clinical documentation is essential.
“We looked at the observed to expected ratios and saw a significant difference between hospitals with clinically focused documentation improvement programs and other institutions [that don’t have such programs]. This suggests that you can outperform other organizations by focusing on clinical documentation,” Dr. Oliva said. Hospitals can easily optimize this part of the equation with computer-assisted physician documentation solutions that prompt physicians to add specificity to notes that will improve the coding process on the backend.
How technology can help supercharge CDI programs
Without technology, CDI programs are heavily dependent on human capital to sift through clinical notes for proper quality, coding and billing. A hospitalist may write what he or she sees as an incredibly detailed note, but the note may not contain particularly accurate or complete diagnoses, leaving coders short of the information they need for billing.
CAPD technology can make clinical documentation improvement less retrospective and integrate it into normal physician workflow. AI and natural language processing have three main benefits in this arena:
- The technology can prompt physicians to add more specificity to notes to help with coding and quality, while they are still thinking about the patient case.
- It can evaluate unstructured text to identify if there is clinical evidence of something not yet noted.
- Automated technology is always on – 24x7x365. Always searching and guiding improvements, filling gaps that just can’t be covered with traditional resources.
Taken together, these benefits mean clinical notes are in a much better place before the physician signs off on it, reducing delay on the back-end. “Delay is the deadliest form of denial,” Dr. Oliva said. While the solution cannot replace human capital, it can move some work to the front-end and help optimize the coding process, ultimately maximizing revenue and optimizing performance.
Conclusion
While providers are moving down the path to value, they are still largely operating in a fee-for-service world, and probably will be for a while longer. To make the most of both worlds, hospitals should put an eye toward optimizing clinical documentation, to maximize revenue and ensure they are ready for value-based care.
One of the biggest opportunities for CDI comes at the point of care when physicians are entering notes. “The top five clinical documentation questions nationally in 2004 were the same as they are today,” Dr. Oliva said. “My hope now is that because we’re actually asking the question now in real-time, instead of the next day, that maybe getting that information when it’s fresh, may actually get them to a different place.”
Using natural language processing and AI, providers can get ahead of coding issues, reduce resource-heavy reviews on the back-end. This will ultimately help providers drive appropriate reimbursement and better understand their patient populations and performance.
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