Earning Regional Referrals: 8 Steps to Grow Hospital Volume

The healthcare market is rapidly changing and efforts to determine physician alignment, ancillary growth and changing payment structures are enough to keep even the most confident CEO awake at night. Even things that used to be a bit easier, like regional referral growth, are now more complicated and more competitive.



Many organizations, while building the ambulatory side and considering their accountable care approach, still rely on inpatient tertiary care. And if the competition seems overwhelming locally, there is a desire to look to the secondary markets. If that concept is resonating with your leadership team, take the time to make certain you are really ready for the obligations.

 

 

Recognize that for some organizations, regional referrals account for up to 60 percent of their inpatient business. Generally the organizations with this level of regional attention are established; infrastructure, communication and the role of the specialist is clearly defined. Take the following eight steps to successfully expand your regional presence — with a keen eye on physician relationships. And if you are well-established as a regional provider, it may be time to re-visit your methods and where necessary, to shore up and defend.

 

1. Assess what you have. Take the time to understand the environment, competitive drivers and what you have — or will need to be effective.

 

  • Evaluate the volume of patients coming from outside your immediate service area. Beyond looking at who comes by geography and clinical specialty, work to determine why they come. Explore the role of employment in the alignment and consider payor relationships. Expose the existing referral relationships by organization, by physician or practice group. Detail any current efforts to enhance regional referral relationships.
  • Identify your advantages for the referring physician. Ask yourself what your organization has that referring physicians might want and/or may not currently be getting. How have you done work in the region historically? Your answers will tie directly to the cost and effort side of development.
  • Evaluate capacity, including beds and specialists, in clinical areas most likely to be of interest. It is expensive to work so hard to earn the business of rural physicians only to have them hear you say, "We can't accept that patient today. Our unit is full." Or, the more likely reply is that your specialists are not willing to accept referrals after 5:00pm on Friday.
  • Include interested members of your medical staff. All too often an organization wants to develop a regional orthopedic referral program, for example, but the orthopedists aren't interested. Without medical staff support, your best-laid plans will backfire. Regional referrals depend substantially on long-term physician involvement.
  • Understand the financial opportunity. Carefully look at the demographics and payor mix of the region you hope to develop. Remember that the referring physician will not want you to be selective just because of payor mix.
  • Determine which organizations are currently serving the region's referral needs. If there's already formidable competition in the spe¬cialty area you hope to develop, the strategy becomes more expensive. Steep competition requires that you have determined you have something better or different to change referral patterns.
  • Assess your internal readiness. The systems that work to manage local referrals are not adequate for regional referrals. The process of accepting patients needs to be streamlined with one call. The systems of communication, working with families that are travelling and communication back to the referral sources are very important.
  • Different systems are needed for referrals from regional hospitals and/or their emergency departments. Assess both areas for responsiveness, ease of use access and communication if your desire is to grow tertiary referrals at both levels.


2. Put Your plan on paper. Many hospitals are tempted to "test the water" with a ready specialty at your facility to see how it goes. Because the business you'd like in the region is likely going elsewhere, this is not as effective as it once was. In today's climate, take the time to think through the process and define a plan. It can follow the standard planning methodology — with a few caveats. A large part of traditional business planning relies on studying marketplace demographics. In your strategy, you'll focus more attention on the regional physicians, their numbers and the size or volume of their practices, rather than focusing on patients in the area. As you put together your business plan, make sure you obtain market intelligence about the true potential of a referral network. A solid plan evaluates the physician market opportunity — something easier said than done. Forecasting is a difficult task and requires the help of someone working in the rural market to provide an estimate of referral potential. If your organization is fortunate enough to have reliable admitting data that tracks and trends referring physicians, look at the current revenue/volume and the opportunity to increase it by one to two percent.


3. Cultivate new and existing relationships. Once you've confirmed that your business plan supports the regional effort, begin to cultivate new physician relationships and enhance existing ones. The four essential elements of a regional referral strategy that is physician-relationship driven include (1) identifying your tar¬get audience; (2) offering a product or service that is of interest to prospective referring physicians; (3) creating a focus to influence or change referral behaviors; and (4) building internal awareness and commitment to keep new referrals.


4. Keep communication flowing. As your plan develops, make certain that the physicians who play a key role in developing regional referrals are at the very center of the communication strategy, that you garner their input and that you use the information to customize your approach. Additionally, when a new approach is implemented, continue communicating with this audience.


5. Get the word out. We can no longer assume that if we build it, they will come. Today, it takes dedicated personnel to communicate the offerings of your program, create interest and work to obtain the business. Field representatives serve as resources for developing new business through physician-to-physician dialogue, positioning referral opportunities and delivering measurable results. Given a choice, regional physicians prefer one representative who assumes responsibility to find the clinical expert or specialist to link with the physician.


6. Meld service line commitment and communication. Your referral volume won't grow without an internal commitment to quality and communication with your referring physicians. This can start with something as basic as having each department record the name of the referring physician on every patient's record. Success with internal referral development also requires a need to diligently follow up on patient outcomes, questions and records.


7. Visible support. Never underestimate the power of education as a tool for reminding your target audience about your organization. CME programs can be offered to the referring physicians in your region as well as to your internal staff. Using your specialists to work with local staff for community screenings also generates goodwill among physicians. And while the impact of these programs is difficult to measure directly, they do speed the process and validate the wisdom of a referring physician's decision to refer to you.


8. Measure the impact. As your organization determines who to target and what specialties to position, the decisions should be made with a careful understanding of contribution margins and market opportunity. Many organizations struggle to obtain good data and to develop good systems for tracking and measuring the success of regional referral programs. Whether your finance team chooses to track and trend changes in referral volume by key service lines or by targeted physicians, develop a clear understanding of goals at the outset. Many programs need to start by tracking the key service lines. First, they look at revenue and volume for the past three years and establish a trend. Then they determine what other factors are likely to directly influence referrals and what percentage of growth would be likely.

 

Programs that have implemented a focused plan are the ones that are reap¬ing internal rewards. They are the organizations that know exactly what they are doing and what they have achieved.


Kriss Barlow, RN, MBA is Principal with Barlow/McCarthy, a consulting firm with expertise in hospital- physician relationship strategy. She can be reached at (715) 381-1171 or by email at kbarlow@barlowmccarthy.com.

More Articles on Growing Referrals:

Study: Physicians' Rate of Referrals Nearly Doubles

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Whitepapers

Featured Webinars