Hospitals and physicians were under financial pressure prior to the pandemic. The Congressional Budget Office (“CBO”) projected that between 40% and 50% of hospitals could have negative margins by 2025. This CBO analysis was published before the pandemic! COVID‐19 has accelerated and exacerbated these underlying financial challenges. For instance, due to Shelter‐in‐Place mandates, the California Medical Association (CMA) estimates that more than 30% of Californians could lose access to their physician. Providers face an unprecedented challenge with dramatic loss of elective procedures and patient flow during COVID‐19.
Our solution : Cogitativo developed a data science‐enabled capability to predict and identify financially fragile physician practices. Leveraging peer‐reviewed research papers regarding physician retirement characteristics, we developed an algorithm to score the probability of physician “early retirement.” In addition to the recent decline in cash flows, our predictive model also uses other “early retirement” features such as the location of medical training, medical specialty, as well as reimbursement mix of Medicaid/Medicare and other payors.
For example, using our predictive algorithms, Cogitativo has identified that over 50% of unaffiliated physician practices in one large U.S. county have a high probability of closing their practices unless additional financial support is provided. The most at‐risk are primary care, OB‐GYN, internal medicine, and rheumatology practices that primarily serve this county’s Medicaid and Medicare beneficiaries. Furthermore, many of these fragile practices are in medically underserved communities.
Call to action NOW! Our data science insights enable outreach to financially fragile physicians to discuss their capital and on‐going practice needs. Outreach activities should also include supporting telemedicine capabilities and transition to value‐based bundled reimbursement. Together these strengthening activities create a financial ramp for reestablishing face‐to‐face physician‐patient office relationships and to stabilize members access to care
At Cogitativo, we believe that through the combination of advanced analytics, supportive payor organizations, and the willingness of physician practices to change reimbursement schemes, we can create a more resilient, less fragile U.S. health care delivery system. These initiatives will help to mitigate the crisis of reduced access to essential health care services.
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