Outpatient Rehab: Attracting the Retail Consumer

Have you met John? He’s a 40-something husband, father and financial advisor who enjoys playing pickup basketball at the local gym. One Thursday night, while attempting to block a shot, he feels a searing pain in his right calf. What will John’s next play be? Where will he go for care? John represents an all-too-common patient in the US: the underactive, overcommitted consumer who is one of the 15.5 million people now insured by a high-deductible health plan. To capture patients like John, your organization must prepare for the outpatient (OP) rehabilitation game.

Capitalizing on OP Rehab Services
While hospitals and health systems continue to build their attractiveness to consumers, OP rehab is often neglected. However, these services represent a huge opportunity to develop your System of CARE, particularly for orthopedic and spine patients who collectively account for over 65% of all OP rehab services. These health care consumers are looking to improve sports performance, prevent or recover from injury, and exhaust nonoperative options prior to seeking surgical intervention. For the hospital, OP rehab can be a financially independent entity in its own right or can serve as a funnel for downstream services, supporting patients’ return to function postsurgery.

Sg2 forecasts a 16% increase in OP rehab procedures over the next five years, and 25% over the next decade. Despite this bullish projection, growth will not be evenly distributed among all organizations. Historically, hospitals and health systems have struggled to capture OP rehab market share, because they have focused efforts on inpatient initiatives and building physician practices. This has created vulnerabilities, allowing private practices and large national rehab providers to capture this book of business. Organizations looking to attract the “retail” rehab patient must perform at the top of their game.

Get in the Game by Attracting the Right Patients
Let’s go back to John on the basketball court. After assessing his situation, John thinks:

  1. It was a bad decision to execute that aggressive block 30 seconds into the game without sufficient warm-up.
  2. My son will be disappointed if our annual family ski vacation is postponed. We’re supposed to leave in two weeks.
  3. It’s November 20, and I’m not even close to meeting my $5,000 annual deductible.
  4. I work full-time—when will I find time to seek treatment?

Will John come to your hospital for OP rehab services? To position your organization as the right choice for John and patients like him, use these questions as a starting point:

  • Can consumers easily find your services? You must have sufficient digital presence and search engine optimization so that Google, Bing or Yahoo directs John to your outpatient rehab program.
  • Can you offer next-day, convenient access to therapy services? Do you offer evening and weekend clinic hours? John might avoid disappointing his son and try healing for two weeks without professional care. The busy consumer will either look for the provider who can meet their schedule demands or forgo necessary treatment altogether.
  • Have you established geographical linkages with other musculoskeletal providers? Patients will often go directly to a surgeon for evaluation. Having therapy services co-located with these providers allows the consumer a “one-stop shop” to quickly rule out serious injury and proceed with treatment in the same visit.
  • Do your payers support evaluation and treatment without a physician’s referral? All states allow direct access to physical therapy without a physician’s referral, but many insurers will still not reimburse for treatment without a referral. (Although this is changing as insurers recognize the need for early intervention and the relative cost-effectiveness of rehab services.) Ensure your medical staff bylaws allow therapists to practice at the top of their license, and proactively approach payers to demonstrate the benefit of early therapy interventions.
  • Have you established a self-pay rate? Many hospital organizations still use a chargemaster to determine OP rehab rates, which are often more than double the fees charged by private or physician-owned clinic competitors. A retail strategy is essential to achieving price competitiveness, particularly for uninsured and underinsured patients.
  • Do you have technological alternatives that optimize a patient’s ability to participate virtually? A few options that some health systems are using to enable virtual health include:
    • Reflexion Health developed Vera, an on-screen avatar that uses Microsoft’s Kinect camera technology to coach and monitor patients through home exercises. This may help eliminate the need for patients to travel to the clinic for some services.
    • FORCE Therapeutics created a platform of high-quality videos for patients to follow during home exercises. In addition, the platform records functional outcomes (eg, Knee Society Score, Harris Hip Score, WOMAC) through the patient portal. FORCE has decreased OP rehab visits following a total knee replacement from 15–18 to 8, while achieving equivalent or better outcomes. As payers become savvy in their reimbursement of OP rehab, demonstrable outcomes in fewer visits will strengthen your bargaining position, with the potential to drive up both reimbursement and steerage for these services.

Not sure you’re ready to get into the outpatient rehab game, or wondering where to start? There are a variety of models ranging from investing in your own space and staff development to pursuing partnerships with local or national providers. Engage Sg2 to assist you in understanding your market landscape, determining the right independent or partnership model, and better linking these services to your System of CARE.

Sources: Impact of Change® v14.0; PharMetrics; CMS; Sg2 Analysis, 2014; America’s Health Insurance Plans. January 2013 census shows 15.5 million people covered by health savings account/high-deductible health plans (HSA/HDHPs). June 2013.; Sg2 Interview With FORCE Therapeutics, August 2014.

  • Share
  • Follow Sg2 on Facebook
  • Follow Sg2 on Twitter
  • Connect with Sg2 on LinkedIn

Tags: ,

"Analytics and expertise to help you understand market dynamics and capitalize opportunities for growth."

As of February 11, 2016, Vizient, Inc. has completed its purchase of MedAssets Sg2 and spend and clinical resource management segments from Pamplona Capital Management, LLC. MedAssets revenue cycle business will continue to operate as a wholly-owned subsidiary of Pamplona Capital Management LLP.

Follow Sg2 on Facebook Follow Sg2 on Twitter Connect with Sg2 on LinkedIn Watch Sg2 on YouTube