Tag: joint venture

Recon takes an analytical look behind select developments in healthcare

The “weaponization” of ACO narrow networks: Strategic destabilizers which compel their own replication?

In theory, narrow networks built around a single provider or a network of aligned providers (“provider-orchestrated narrow networks” or “ACO networks”) can pose a much higher stakes threat to non-participating providers than ones assembled solely by payers (i.e., where the payer picks who is in based on cost and rates): They are more likely to achieve broad utilization reduction because participating providers can align on principles, build shared capabilities and coordinate management of specific patients consistently. As a result, discounts can play a smaller role in creating a compelling value

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Marrying into the right family: the bets underlying United’s revenue cycle management joint venture with Dignity Health

Market for outsourced revenue cycle management could be big The revenue cycle management (RCM) vendor industry is about $2.0B for hospitals and $11 billion for physicians today. The market is constrained because most providers do their own RCM. Vendors only have a ~10% penetration among hospitals and a 25% penetration among physicians (implying that the potential combined hospital and physician market is $60-70B). However, RCM as a function is getting more complex and outsourcing could quickly start looking more attractive: Value-based contracting models raising the stakes in documentation, reporting, benchmarking,

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Romance of convenience: perspectives on the IASIS-Aurora joint venture

Summary Two major hospital systems have agreed to a joint venture to explore growth opportunities on a “case by case” basis One system is a major non-profit, the other a PE-backed for profit serial acquirer; their strategies, capabilities and geographies of both partners do not overlap The venture is likely focused on sharing capabilities and allowing each partner to take those back to their core markets Given the complementary skill sets, competitors to either system would be wise to expect upgrades in traditional weak spots * * * A few

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