Referrals Management: 5 Steps to Increasing Patient Retention

As payers and providers begin to collaborate and share risk, the need to keep patients within the network increases.

Keeping patients within the care network, where appropriate for the patient, allows for more proactive care coordination and better monitoring of care quality, both of which can help reduce unnecessary and costly care. However, keeping patients within the prescribed network is easier said than done.

Most networks lose a fair amount of patients due to a number of factors including patient choice. Referral management is one factor hospitals and health systems can control, and it's one of the best methods to spur patient retention. NancyHam

By following these five steps to manage referrals, an accountable care organization, hospital or health system can effectively and significantly increase patient retention:

  1. Define the network. In a fee-for-service world, hospitals simply wanted to credential as many physicians as possible. If you walked into the average hospital and asked for a printout of its network, you would likely walk out empty-handed. In a value-based purchasing environment, hospitals must actively define and manage a distinct network. Initializing such a network is a foundational step and a significant achievement, but the work doesn't end there. Network management is an ongoing discipline.

  2. Evaluate why patients are leaving the network. Load the data associated with the newly defined network into a workflow or analytics tool. These tools enable administrators to pinpoint where business is going outside the network and evaluate why. They can then categorize the reasons and prioritize which categories to address. Is the reason the patient is going out of network acceptable? Does it represent negotiated referrals? This initial evaluation sets the baseline from which to measure future performance. In this step, it is important to extend the focus beyond the traditional PCP-to-specialist referral patterns. For example, many patients leave the network while transitioning from acute to post-acute care.

  3. Communicate with physicians. The responsibility for referring patients rests on the shoulders of physicians. Hospitals need to have a process in place for educating physicians on keeping patients in-network. This education is particularly important as hospitals acquire physicians with established referral patterns. At the most basic level, physicians need to know which of their referral partners are in-network and which aren't. Having quality performance data on hand is key to motivating physicians to change their referral behavior. Physicians in value-based contracts who understand joint accountability for outcomes will want to see that an in-network referral partner delivers high-quality care.

  4. Analyze why you're losing patients in real-time. After establishing a baseline for patients leaving the network and addressing the issue with physicians, organizations need to monitor data in real-time to see if in-network referral rates improve. Historically, the examination of the reasons patients go out of network has been a retrospective, periodic analysis using claims data. But as with any effort that relies on data to drive behavior change, a snapshot every few months isn't sufficient. Some types of leakage are so expensive that a daily or weekly snapshot is required to enable earlier intervention. Ideally, organizations need a workflow tool that can guide physicians in real-time to desired referral behavior.

  5. Optimize the network. Of course, the ultimate purpose of the network is to ensure the best clinical and financial outcomes for patients, providers and payers. When the network is first established, a hospital's goal might be to ensure that a targeted percentage of cardiology referrals go to its in-network cardiologists. However, as the sophistication of the organization's network management grows, it will want to optimize its referral patterns even further. For example, data might reveal that one cardiologist delivers the best outcomes for heart failure, another for angioplasty and another for cardiac rhythm disorders. The hospital would then optimize its network to ensure that patients are referred to the best cardiologist for their condition.

No healthcare organization can make a patient stay within its care network, nor would that necessarily be in the best interest of the patient in every instance. But through sophisticated referrals management, ACOs and health systems can systematically — and successfully — guide patients to the highest-quality, lowest-cost care options.

Nancy Ham is  CEO of Medicity, a company which provides solutions to enable population health management. Ms. Ham has a proven track record of innovative and high-energy leadership in establishing, developing, growing and operating private and public health care information technology companies. Nancy holds a bachelor’s degree in economics from Duke University and a master’s in international business Studies from the University of South Carolina.


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