What drives the cost of care?

Jun 30, 2014 | Healthcare Industry News

In a previous post, this blog explored how medical costs are set to rise at the end of 2014. Now, Den Bishop, author of "The Book of Healthcare Reform: The Economic Truth of Healthcare in America" has spoken to InsuranceNewsNet.com about how the cost of healthcare is inflating at a much faster rate than the GDP.

"Healthcare is driven by thee things: Cost, Congress and complexity," Bishop told the source, explaining how the country has the highest cost for healthcare in the world, and that trend "won't stop and can't stop."

Bishop told the source about how different care facilities demand different payments for the same treatments and procedures, and how these differences can often be substantial. He offered the example of a major joint replacement, as its cost varied widely between three different facilities: at Los Colinas Medical Center the procedure cost $159,000; at United Regional Healthcare Center it's $51,000 and Kell West Regional Hospital, $27,000.

Bishop explained that in ideal circumstances, the cost would be uniform across all providers, or at least tied to Medicare reimbursements for the procedure. While he admitted that this is a long way off, he explained that the most effective way to lower the cost of care is to increase wellness programs that help Americans learn to better manage their own health. 

"We need to produce less disease," said Bishop. "We can do better. We can change the risk but from 2007 and 2012 we've seen no increase in measures showing people how to do it."

While this may be an effective long-term strategy, there will always be a need for emergency or specialist care that can only be provided by quality facilities. But if the cost of care has affected the financial standing of your facility, then it could be time to consider accounts receivable services to increase cash flow and continue to provide quality patient care.