Few hospitals have charge-based reimbursement contracts. Indeed, over 80% of payer contracts are negotiated fixed-fee reimbursement with the balance being shared-risk based on patient outcomes known as value.

One recent analysis concluded it is virtually impossible to make more money in a value contract than fixed-fee reimbursement when service line payer mix is heavy on commercial insurance.

Like everything else today, it’s important to have analytics that track patient and payer mix change in real-time.

Modeling value as a comparative to fixed-fee reimbursement in service lines weighted heavily with Medicare and Medicaid patients is a must as is keeping score of changes in your population health book-of-business.

Patient mix change and variation is a constant in today’s health care. A strong analytics suite makes sense of change and also can measure the net revenue impact of potential change.

What does this have to do with setting market pricing via the hospital charge master?

Everything begins and flows through the hospital charge master, including revenue from thousands of charges.  Making the charge master relevant again with rational and defensible pricing sets the table for several potential forward strategies:

• Use charge master pricing to reposition the hospital strategically in its market
• Determine which service lines should be considered for value reimbursement
• Negotiate more favorable payer Agreements
• Connect disparate patient data to structure a new growth initiative
• Identify potential service lines that could be targeted for an Upstream Medicine initiative

A strategic charge master starts with a comprehensive analysis of hospital pricing and your market.

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