Q: How can I prove my value to an accountable care organization?
A: Over the past few years, many home health agencies and hospices have purchased customer relationship management (CRM) systems to better track the activities of their sales force and customers. Along with the software, many organizations have also purchased data about their customers/referral sources, including hospitals, skilled nursing facilities, and physicians. This information is useful for identifying those prospects who are most likely to purchase and have the highest purchase potential; however, it is not sufficient to set strategic direction for your organization. Strategic planning requires a deeper understanding of your marketplace and your competition.
How Much Opportunity Exists for Organic Growth in Your Market?
When it comes to strategic planning, you need to first understand how much opportunity there is for organic growth. Quantifying this opportunity is one key element in understanding the relative usage of the home health or hospice benefit in your market. By comparing this metric to state and national averages, you can then determine whether you should be pursuing a “red ocean” or “blue ocean” strategy. For an explanation of these strategies, see our previous newsletter article and presentation on the subject. In addition, state and national average utilization can be downloaded from our website.
Calculating utilization rates involves knowing the patients served in your market, which can be found on the Executive Summary Report for home health or hospice. This number is divided into the Medicare fee-for-service (for home health) or Medicare enrollees (for hospice), which can be found on the Medicare Enrollment Report. Keep in mind that it is always easier to have a referral source provide your agency with a type of patient they have not referred in the past versus taking a patient away from another provider.
Differentiate Your Organization from the Rest in Your Market
Once you have identified your best prospects from your CRM data, you then need to differentiate your agency or hospice. In the past, many home care organizations have tried to be all things to all people; the result has been an undifferentiated image in the marketplace. Successful providers are those who choose to focus their efforts, resources, and image on managing a certain type of patient or clinical condition. To decide on your organization’s standard-bearer, you need to understand how large that opportunity is, who your competition is, and how well you manage those patients. Our Primary Diagnoses reports for home health and hospice and our Key Indicators by Diagnosis home health report can deliver insight to help crystallize your direction.
Too often — because of the daily pressures of running a business — we seek quick and easy answers. Setting strategic direction for your organization is too important to be based on a single set of market share numbers drawn from a CRM system. Developing an organizational direction will be most successful when based on a well-thought-out analytical process that seeks to comprehend your market and competition. Relying on a single set of numbers tends to result in a decision based on more “gut instinct” than careful consideration. The future of your home health agency or hospice is too important to be based on a snap decision.
Note: Healthcare Market Resources provides information that is comparable to the data loaded into most CRM systems. If you do not have a CRM system, you can get the benefits of this data from Healthcare Market Resources without having to install an entire system and disrupt your sales process. Unfortunately, some CRM vendors effectively lock out competitors’ data by charging exorbitant “loading fees,” thereby preventing their customers from obtaining this valuable information in the most cost-effective manner.