Thoughts on Medical Banking

This past week, I was in Nashville attending the Medical Banking Project’s Leadership Forum, which was hosted by the Vanderbilt University Center for Better Health.  The Medical Banking Project is a think-tank whose goal is to raise awareness of how banks and healthcare can intersect and drive increased efficiency, visibility, etc.  The goal of the forum was to choose a few projects where the members could work together to pilot some use-case concepts that would demonstrate how these two very different industries could work together.When people hear the term “medical banking” they’re often confused, and that confusion doesn’t improve much even among the medical banking project members.  With such a broad scope and so many different vendors and other organizations involved, everyone’s definition seemed to be different.To pare things down, here’s a few points that most members would agree with:

  • Banks specialize in well defined discrete transaction processing coupled with high visibility.
  • Healthcare organizations specialize in complex decision making that often requires the distillation of large amount of data into generalized care protocols that are often adjusted based on specific peculiarities.
  • Financial organizations are not very well equipped to deal with “creative” or “non-standard” processes or products.  When your only tool for evaluation is a balance sheet, context gets lost very quickly.
  • Healthcare organizations face a really large challenge distilling down their very fluid, complex, customizable environment into financial transactions, and as a result, are really bad at providing visibility to anyone involved in the healthcare spectrum (patients, providers, payors, regulators, etc.).
  • Trends suggest that patients will become more responsible for costs out of pocket, and combined with rising expectations of online access and visibility, will begin demanding more from healthcare providers.

When you discuss these items with banks, they feel as though they can provide back office support to healthcare institutions and get paid for the transactions that would flow through their already-established networks.  Healthcare providers are generally just desperate to get out of the billing and payment nightmare that has been created for them so they can focus on providing care.The question is, how?This questions is particularly challenging when you have the CIO of Vanderbilt University Medical Center, Dr. Bill Stead, one of the Leadership Forum’s keynote speakers say with certainty that “we have no systems or technology available today that can provide what we need.”  Healthcare providers want more information that’s more accurate more quickly comprised of huge volumes of more data.  Banks and consumers want less information that can be presented as a line item on a statement, priced accordingly, and compared to other options quickly.The key, we all agreed while at the Forum, was a national network for transacting healthcare and financial data.  Where the group didn’t always agree, was whether querying the data in aggregate would be useful.  The bankers in the group pretty much didn’t understand how valuable such analytics could be and how much cost could be wrung from the system by examining the whys behind the transactions.  That’s typical.  Most who haven’t been in healthcare can’t imagine how small variances can introduce magnificent variations in the costs to provide a service or procure a product.  The healthcare entities in the group kept stressing that they wanted to provide the data, but had nowhere to send it and major challenges paying for the applications and training that would facilitate collection of the data.We’ve got a lot going on right now in the industry, what with the healthcare stimulus (ARRA), an increasing drive by Medicare and Medicaid to introduce pay-for-performance measures and more accurate reporting requirements (example: the Deficit Reduction Act of 2005), and a general push by everyone for better technology and better visibility.  Most of what we covered is too long for a single post, so I’ll continue to post thoughts on the Medical Banking Project over the next few days.