Network leakage, or patient referral leakage, costs health systems 10% of their annual revenue on average. For many health systems and provider groups, this represents millions of dollars going elsewhere. While network leakage can't always be avoided, it may be surprising that it can be addressed through process changes and data infrastructure. By using smart technologies and modernizing data processes, health systems can reduce network leakage and improve patient access by focusing on provider directories, an often overlooked data asset for patient access.
How can data infrastructure impact network leakage?
There are many reasons network leakage occurs, whether it's a paper-based and patient-driven referral process or a lack of awareness from referring healthcare providers. Many of the traditional causes and solutions to network leakage are focused on human processes.
However, network leakage (and its inverse, network keepage) is heavily influenced by data infrastructure and easy access to reliable provider information. To address gaps in communication between healthcare providers and challenges with patient navigation, a complete and reliable provider directory is critical to reducing friction in the referral process. Today, the process of updating a directory and reconciling that data across many systems of record increases the risk of network leakage and exacerbates challenges in patient navigation and patient access.
A health system might ask, why do I need to improve my provider directory? Shouldn't that data be accurate since we directly contract with those clinicians and manage that data every day?
While this seems like it should be the case, Orderly Health has found that over 35% of data reported directly from health systems to update payer directories contains errors. This signals data fragmentation within provider data sources at health systems. Addressing this fragmentation has the potential to reduce network leakage and increase captured revenue by millions of dollars annually.
How can I reduce network leakage through data infrastructure?
Data integrity is the backbone behind patient referrals. Without a solid data foundation, referrals can lead to increased network leakage-either because of process gaps within the referral process or because the data provided to a patient for a referral has errors. This can manifest as a listing for a billing office rather than a practicing address, an out-of-date phone number, or missing contact information. Sometimes, clinicians have moved without informing their peers, retired, or stopped accepting new patients. All of these cases can happen because of fragmented data and inconsistent communication.
If data fragmentation is a cause of network leakage, what can we do about it?
While we often think about network leakage as a revenue cycle problem, or a people-driven problem, a large missed area of opportunity lies within data infrastructure. By connecting the many different systems in which provider data and directory information are recorded, a healthcare organization can create a unified source of truth for provider network information that does not exist today.
To do this, health systems and provider organizations must invest in building bridges between several different systems of record, whether that is an HRIS system, contracting system, credentialing platform, EHR, or provider database. By creating a single source of truth for this information paired with automated and prioritized updates between the sources of truth, healthcare organizations can solve data fragmentation for provider networks. By addressing data infrastructure, the gains in data integrity are durable, as opposed to constant patient and provider outreach with traditional efforts to reduce network leakage.
How will addressing data infrastructure impact my bottom line?
By addressing network leakage through data infrastructure, several improvements are possible, including:
1. Improved Financial Performance
By bolstering data integrity and streamlining data updates, provider data becomes a strong foundation for a network management system. Pairing smart technology with streamlined operations reduces the risk of network leakage and can improve topline net patient service revenue by filling in gaps in the data.
2. Cost Containment
When patients receive care outside their designated provider networks, it causes increased costs and unavoidable expenses. But with the right strategies in place, paired with data governance measures, costs become more effectively managed in a value-based care model. Additionally, by focusing on in-network utilization, health systems have an opportunity to strengthen their relationships with providers and negotiate value-based care models to align incentives and better rates.
3. Enhancing Patient Care
Network leakage not only impacts financial performance but also compromises the quality of patient care. When patients receive care outside their designated networks, it becomes challenging to coordinate their healthcare journey effectively. This lack of coordination can lead to fragmented care, delayed treatments, and compromised patient outcomes. By addressing network leakage through data-driven solutions, healthcare organizations can enhance patient care and improve patient experience. Accurate provider data helps organizations better match patients with appropriate providers within their networks, ensuring seamless care coordination and continuity.
Addressing network leakage is vital for the financial health and patient care outcomes of health systems and provider groups. The secret to tackling network leakage lies in addressing data integrity and building a solid foundation across systems for provider data. Using automated solutions and process improvements will drive a positive change in healthcare delivery.