An Ounce of Prevention

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Sumit Nijhawan

How Continuous Monitoring (CM) solutions can save your healthcare business money – and perhaps save a few lives along the way

By Sumit Nijhawan

One of the cornerstones of quality healthcare is continuous monitoring of a patient’s vital signs.  Automated controls constantly provide readouts that illuminate risk indicators.  Not only does it show what’s happening in real time; it also triggers instant alarms when any vital sign strays outside safe parameters.

So, why, when it comes to dealing with the integrity of the business information that drives the healthcare system, are providers and insurers reluctant to take a lesson from operations in their own industry?  According to a recent report on MSNBC.com, one in five health insurance claims are wrongly handled.  Avoiding such errors and inefficiencies could save up to $15.5 billion annually in administrative costs – money that could be used to improve (and bring down the cost of) patient care.

Unfortunately, the industry continues to rely on costly, time-consuming manual controls and auditing processes to verify information and operational efficiency.  Failing to build automation into continuous monitoring of the business operations of healthcare is akin to hospitals and care centers throwing out all that expensive equipment in favor of nurses taking vital signs with mercury thermometers and writing notes on paper charts.

In today’s atmosphere, when healthcare organizations are being held to ever-higher standards while doing more with less, manual and internally-built solutions are no longer sufficient.  The costs and inefficiencies can interfere with the basic mission of any organization in the healthcare industry: Affordable, high quality patient care.

Manual home-grown monitoring tends to focus more on the mechanics of control than on the business and its ability to take care of people and ensure payment of their bills.  In an era when quality of care and ability to pay are national priorities, this orientation must change.  Here are two examples of the risks:

  • Healthcare providers and insurers soon could be dealing with as many as 30 million new consumers of their services and benefits due to federal mandates.  They will be processing more transactions than ever before, which means more potential for errors that impact care and payment operations.
  • In January, the Centers for Medicare and Medicaid Services issued new requirements for insurers and self-insured entities regarding reporting of settlements, awards and payments made to Medicare-eligible claimants and/or plaintiffs.  Fines as much as $1000 per day per claim could be levied against organizations unable to report accurate information.

Continuous Monitoring (CM) solutions that automate the monitoring and control of large, complex sets of information are the best way to cope with these risks. CM enables healthcare organizations to continuously monitor and control activities and information across an entire enterprise, providing a broader range of benefits than financial or ERP systems alone. With CM, organizations can move beyond manual, semi-automatic or even embedded controls, improving their ability to reduce costs, mitigate risks, improve business processes and streamline compliance.

Inter-related systems

Like medical specialists assembled for a consultation, there is a tendency for different parts of a healthcare organization to focus only on their area of concern when examining monitoring and control requirements. That can be a fatal mistake.

Take cost-containment. The financial department is focused on assuring costs meet predetermined budget levels. With manual, internally-built controls, there is a strong temptation to inspect data in batches and samples. While batch-processing drives costs down, it could also spike an organization’s level of risk.

A CM approach accomplishes cost reduction without compromising risk management. CM removes the labor costs by monitoring all the data automatically and continuously.

As part of this process, CM creates an audit trail for every activity. When an anomaly arises, the research and resolve process is greatly streamlined because all of the data is easily visible and searchable.  Further savings are realized because automated controls require testing once during any given evaluation period, versus 15 to 25 times for manual controls.

Audit and compliance issues can feel like life or death to any enterprise.  In the healthcare industry, though, that risk is not just figurative. It also can be literal.

Continuous Monitoring can help reduce risk (and costs) by automatically tracking a business’ vital signs and alerting key personnel early to problems or violations.  CM can also keep the enterprise healthier by improving business processes. Because in business as in healthcare, an ounce of prevention is worth – well, you do the math.

Sumit Nijhawan is the Company Operations Leader at Infogix, a software company whose solutions monitor, detects and prevent information errors.  Before coming to Infogix, Sumit worked for the Blue Cross Blue Shield Association, SPSS, Inc., and PricewaterhouseCoopers. Sumit received a Bachelor of Arts degree in physics and chemistry from Coe College, a Ph.D. in engineering from Brown University and completed the Program for Leadership Development at Harvard Business School..