By Steve Hendrick
Management at one large orthopedic practice noticed a disturbing trend: compensation for one of the group’s busiest spine surgeons was suddenly declining. At a time when reimbursements are shrinking and practice margins are tight, this finding naturally set off some alarm bells among the group’s leadership.
In my experience, when physician groups notice unexpected declines in compensation, they tend to suspect revenue cycle issues are the culprit. Sometimes, that suspicion proves accurate; more often, however, identifying the real problem requires much more diagnostic work.
Fortunately, this specialty group had an intuitive analytic tool—Arrowlytics–to determine the root cause. In simple terms, Arrowlytics relies on a powerful engine that can sift through vast volumes of information stored in the data systems of healthcare practices. Each night, the software refreshes Key Performance Indicators (KPIs) to provide actionable insights—in areas ranging from space utilization to same-day patient cancellations to payor reimbursement trends—that empower medical providers to optimize their operational performance and increase revenues. Arrowlytics is a prime example of how savvy provider groups leverage data to guide them toward more informed decisions and thrive in a financially challenging environment.
With help from Arrowlytics, the physician group undertook a step-by-step analysis to identify the source of the sudden change in compensation. First, they asked whether the change involved all their physicians or only spine surgeons. Then, once the data showed the issue was limited to spine, the question became: Are all spine physicians affected? The answer was no; only one individual surgeon was experiencing a decrease.
With the search now narrowed, the group could focus on questions pertaining to the one doctor. Had this physician worked fewer sessions? Was there any change to new patient volume? Were there suddenly fewer patients per office session or surgical session? Had there been any changes in billing or collections performance? In each case, the answer was no.
So where was the problem?
Analyzing the physician’s payments by payor mix, Arrowlytics revealed a change where the percentage of “less favorable payors” had shot up from 4% to 35% at a single location. The Arrowlytics platform confirmed that this sudden shift stemmed from a single referring practice, owned by a local hospital system, that had begun cherry-picking cases with favorable payors to refer to hospital-employed specialists.
The physicians enjoyed clout with the health system since the orthopedic group brought a significant volume of surgeries to that hospital. Armed with the data provided by Arrowlytics, they presented their findings to the hospital’s leadership. The referral patterns were immediately corrected, and the spine surgeon’s compensation returned to normal.
Thanks to Arrowlytics’ KPI capabilities, which allow providers to measure key performance indicators and other productivity metrics, the group could examine often overlooked drivers—including sessions worked and referral patterns—that demonstrated precisely where the compensation issue originated.
This is just one among many examples of how providers are applying technology to improve the performance of their organizations.
Traditionally, many physicians have been leery of technology solutions that rely on AI or Big Data. They are understandably concerned about a possible loss of decision-making autonomy. But rather than taking control away from them, many of today’s emerging technology solutions empower providers to make more informed decisions.
Increasingly, those decisions can mean the difference between thriving in today’s healthcare environment and merely surviving.
Steve Hendrick is SVP—Enterprise Partnerships for MontecitoPLUS and CEO for Arrowlytics.