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The United States spends a fortune every year on healthcare – about $ 4 trillion, right? Unfortunately, not all of this money is spent wisely. Spending on healthcare is a waste of about four dollars each; Which is a waste of about 1 trillion dollars a year. This waste is associated with the cost of the premium, which means that a fraction of the premium does not add any value to the actual health outcome. After all, healthcare is already unaffordable to many, leading to millions of uninsured and under-insured Americans. Before the Affordable Care Act (ACA), there were 30 million uninsured Americans; Still, healthcare coverage for these Americans will cost less than $ 300 billion. Therefore, only a fraction of the waste can cover insured and non-insured, as well as reduce the cost of premiums for all Americans. This will help reduce the burden of national diseases, which is beneficial for the whole country.
The way U.S. healthcare is organized, funded, and distributed involves a large number of operational, administrative, clinical, financial, and compliance transactions, creating a transaction-intensive industry. In addition, these transactions generate a huge amount of historical and contemporary data. So, unless we meaningfully consolidate all sources of money to make transactions more intelligent and cost-effective across the continuum of care, the amount of waste will be higher and Americans will continue to suffer. Here’s how we can solve the waste problem by plaguing the American healthcare system.
Breakdown of unnecessary healthcare costs
There are three main buckets in which billions of dollars of wasted healthcare dollars fall. These three buckets are, broadly speaking: unnecessary administrative waste ($ 100 billion), physician / hospital abuse, abuse and incompetence ($ 400 billion) and unnecessary drug-influenced medical costs and lack of home care management ($ 400 billion).
While this may seem like an insignificant number, there are several reasons why this creates unnecessary costs. First, the two major parties control most of how খরচ 4 trillion is spent: providers (such as private insurance, Medicare and Medicaid) and pharmacy benefit managers (PBMs). Because they determine how the money is spent, these two industries have a huge amount of control over how healthcare is managed and how the industry as a whole works.
For decades now, the pair and PBM industries have relied on legacy platform foundations that are not only fragmented but also require intensive human capital to operate. With the entire process and workforce built on managing transactional tasks around existing legacy platforms, it is not surprising that the healthcare industry has resisted modernization. Thus, the journey towards the elimination of healthcare waste begins with the technological revolution and rapid adoption.
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Pair and PBM: Two legacy industries in need of a technological revolution
The energy that payers and PBMs use is particularly relevant to the question of waste in the healthcare system, as both industries are significantly older and in need of transformation. Despite decades of technological advances, the healthcare industry and its platforms have not evolved with it. As a result of this gap, the technological gap for these legacy platforms cannot be bridged. Therefore, not only do these older platforms communicate with each other, but they also lack the ability to take advantage of new technologies such as robotic process automation (RPA), machine learning (ML) and artificial intelligence (AI).
In order to support the U.S. healthcare structure, peers must have 15-20 separate divisions to handle 2,000 to 3,000 administrative, financial, clinical, and compliance transactional tasks at various stages of healthcare delivery and management for the vast business operational footprint. The same is often true of PBM. Because legacy systems operate on so fragmented and outdated technology, many of these tasks are manual and unable to provide actionable intelligence at every point-of-care. Through all these isolated transaction processing, you can see how quickly we can waste around $ 1 trillion.
Disabled by legacy technology, the healthcare industry does not operate efficiently and intelligently, resulting in increased operational and unnecessary medical costs. As these two industries determine everything from the cost of services, medicines and care supplies to how care is provided, the lack of cost and quality accountability creates a strong impact that pervades the continuity of care.
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Automation is an unprecedented opportunity
Automation is the key to tackling these difficult processes. By establishing an interoperable modern platform between the various stakeholders responsible for managing patient care, we can significantly reduce the amount of administrative waste required to complete these transactions while reducing unnecessary medical costs. Such automation can replace many of the human capital needed to make legacy systems work, and that talent can be restored throughout the organization where a human touch is needed. This recycled human capital can be used to influence the type and accountability of practicing physicians, hospitals and any care delivery facility and to manage long-term care patients at home for improved quality and health outcomes.
Of course, the patient suffers the most. The incoherent nature of today’s healthcare industry means that physicians, pharmacists, or other care delivery stakeholders in a continuum of care do not have ready access to a 360-degree view of the patient. These transaction systems contain and generate large amounts of historical and contemporary data on patients, physicians, care providers and outcomes. However, fragmented inheritance systems are unable to use this data for the real-time analysis required at the point of care, which leads to incoherent care.
The problem is exacerbated when we consider care management at home. About 5% of the population makes up 50% of total healthcare expenditure, an unmanaged portion of managed care. Patients with chronic conditions, mental retardation or those in need of constant care may see significant improvement in the quality and timeliness of their care if a platform-driven automated process is used to manage their care. This will help reduce the cognitive load on care stakeholders to take proper care of their patients ’condition. And using artificial intelligence and machine learning, it will help identify even the most optimized and advanced care opportunities. This will not only streamline patient care management at home so that they can reduce hospital visits, but will also allow care stakeholders to actively care for patients. This will result in better health, better provider quality and less chance of human error.
We need to combine care
The healthcare industry needs to do better to integrate care, and RPA and AI can help. With the technology currently available, there is no reason why platforms cannot be developed for a patient to acquire and deliver functional intelligence at every point of care without disrupting the provider’s workflow. Also, platforms built into the cloud-native architecture can help automate billions of transactions and analytics and gain functional intelligence across PBM and providers. Although legacy systems can migrate to the public cloud, such as Amazon Web Services or Microsoft Azure, only cloud-native platforms can take advantage of the on-demand computational power available in the public cloud. Simply upgrading these legacy systems and moving them to the cloud only leads to the digitization of the superficial healthcare.
Imagine being able to successfully integrate actionable intelligence into every point of patient care. Patients will find more accurate and accountable care, and ultimately, more comprehensive care from their provider. This will significantly reduce the burden on physicians and other care delivery stakeholders, thus helping to prevent burnout. Most importantly, however, it will help us better allocate our resources to properly care for patients who need it, when they need it and how they need it, which, above all, should be the primary purpose of our healthcare system.
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Pairs and PBMs require a combination of care and a more robust management platform that can only handle large transactional tasks. The platform should include automation and AI not only to optimize human capital but also to empower care providers with comprehensive, real-time actionable intelligence derived from historical and contemporary care data. This will reduce waste and reduce the burden of national diseases. The technological revolution is the first step in eliminating healthcare waste. However, healthcare transformation must go beyond technology. Accountable care is another opportunity to eliminate healthcare waste by sharing risks across the continuity of care.
