How to Create a Successful Post-Acute Network (PAN)

Never underestimate the importance of having a coordinated Post-Acute Network of Skilled Nursing Facilities. You may be familiar with a hospital that has its own Post-Acute Network, Senior Network, or Community Collaborative. These are all different names for a similar approach. 

The goal is to set an expectation for your post-acute providers that encourages a commitment to quality, communication between providers, and working together to prevent readmissions.

Some hospitals also invite home health and hospice providers to their post-acute network. In my experience, when a hospital includes multiple levels of post-acute care in the meeting, the group becomes too large and has too many competing interests. 

Some organizations have taken to having a post-acute network meeting for Skilled Nursing Facilities (SNF) and a separate meeting for home health, home care, hospice, palliative care, and assisted living providers. This would also be an effective approach. However, if your network included a hospital-owned home health and hospice provider, it is much easier to have one Post Acute Network meeting and include the hospital-based home health and hospice providers along with the SNF’s. 

The Good…When does a Post-Acute Network (PAN) Work

A post-acute network is a no-brainer for every acute hospital. Stick to the basic rules of:

  • Hosting it at the hospital, not off-site! 
  • Monthly is too often, quarterly is not often enough. Meeting every other month is the key!
  • Do not require a massive amount of data to be collected by members (they do not have the resources and they often just make it up), keep it simple and manageable
  • Feed the attendees a decent lunch or breakfast
  • Make sure you have the right attendee. The marketing and admissions representative from the hospital is only welcome if accompanied by the Administrator and Director of Nursing. If the admissions person is a clinician (RN/LVN) who actually performs Evals have some latitude on this rule. But the point is the SNF’s leadership needs to prioritize this!  
  • Make sure when attendees leave they understand the whole point of the PAN is to enhance communication to prevent avoidable hospitalizations.

The fact that the hospital is hosting the meeting in itself suggests that hospital leadership is committed to improving coordinated care and preventing avoidable hospitalizations. But if the SNF’s blow it off, which shockingly many do, be sure to call them that same day and let them know that “we are happy to remove your facility from the invite list and permanently un-invite you from future meetings if you think the every-other-month meeting is that unimportant,” (they will get the point!).

The Bad…When does a Post-Acute Network (PAN) NOT Work

Let’s simplify this concept: The hospital hosting a PAN meeting is simply the hospital flexing its muscle, making sure the post-acute providers in the region are paying attention. No disrespect to post-acute providers, but hospitals have tremendous resources and are used to good processes and consistency. Having been a post-acute provider, resources and staff are thin, so good processes are often difficult to implement and sustain.

With that said, attending a bi-monthly PAN meeting enhances this communication between providers and can help level-set expectations. Here are a few things that will guarantee the PAN fails:

  • The hospital having unrealistic expectations about what the SNF’s are capable of from a data collection and EMR standpoint
  • Do not host the meeting offsite – it must be at the hospital
  • Do not host monthly or quarterly, but every other month
  • Do not require a boatload of data, even if automated by the EMR
  • Do not skimp on the food. Feed them a good meal and facilitate a worthwhile conversation. 
  • Keep it to 75 minutes – with at least 15 minutes for networking

If your hospital does track readmission by facility, feel free to share the monthly stats but this can work for you or against you; it has occasionally backfired.

 Last but not least, the SNF’s simply do not know how many readmissions they have monthly and have been known to bend the truth even if they do and say “we had no readmissions,” so don’t rely on them to self-report.

Why every hospital needs a risk assessment strategy

Who needs to buy a risk assessment tool when me and my fellow case managers and nurses can tell you who all of the high-risk patients are before they arrive?!? 

If you work in the hospital readmission prevention space, you have likely heard this before. And there is a lot of truth to it. 

Risk assessment is just one of the tactics a hospital can use to reduce avoidable hospitalizations

. In the 2015 book Readmission Prevention: Solutions Across the Provider Continuum, I broke the prevention tactics up into three categories. 

  • Prevention Planning Phase One (PPP1): Before discharge
  • Prevention Planning Phase Two (PPP2): After discharge
  • Prevention Planning Phase Three (PPP3): The patient returns to the emergency room. 

Separating the many tactics operators can use to prevent readmissions into three planning categories provides an efficient platform for acute and post-acute providers to focus on individual tactics that may be worth considering.

But first, a disclaimer…

Most tactics have not worked.  That’s because of a lack of commitment from the top. The acute hospital industry is rife with investing all resources in the “problem of the month,” and then abandoning that effort just 60 days later to focus on the new problem. 

And the new problem is almost always more of a priority than preventing readmissions. Why? The bottom line. Even with a 3% (of overall Medicare spend) penalty, the amount is just a ripple in the overall revenue of the hospital.

Prevention Planning Phase One (PPP1): Before discharge, focuses on all of the information that can be gathered while the patient is still in the hospital and it also includes tactics the hospital and care team can deploy before the patient is discharged from the initial hospital stay. 

The initial hospital stay is referred to as the index stay. The readmission penalties implemented by CMS apply to Medicare Fee For Service patients (within the five disease categories) who readmit to any short-term acute hospital for any reason within 30 days of being discharged from a hospital. In short, the discharging hospital is penalized when a patient readmits to another hospital within 30 days of the discharge date of the index stay

During the index day, the hospital has the opportunity to capture a significant amount of information about the patient. As electronic medical records become more mature in the healthcare setting, the hospitals must make it a point to consider this in gathering as much data as possible about the patient to prevent unnecessary readmissions. The most common form of data-gathering during the initial index stay is risk assessment. However, there is a tremendous opportunity to capture significant data about that patient well beyond just risk-stratifying them to more accurately predict each patient’s likelihood to readmit based on their overall health and care plan. 

For example, family members often provide critical data that would never appear in a medical record. Pertinent patient input and information is often not documented or even appropriate to be included in the medical record. While risk-stratification might be the most commonly implemented tactic used to combat readmissions before discharge on the index stay, those hospitals that are truly taking this issue seriously are going to great lengths to educate the patient (and family) and capture as much data as possible about the patient while they have them in-house.

Make Risk Assessment a part of your structural DNA

I used to joke that every emergency room should have a siren that goes off every time a patient that is a readmission candidate presents (shows up at the emergency department). While the point was made, having a notification system when a high-risk patient presents remains critical – but this should be automated in your electronic medical record system. 

The most important thing hospitals can do to address the readmission penalty is capture as much data as possible about the patient at each patient encounter. This is becoming much easier with the integration of electronic medical records both in the hospital and the physician’s office. 

Once collected, the hospital then uses a risk assessment tool to interpret the data. Hospitals across the country have turned to different solutions to conduct risk assessments. While many hospitals conduct a risk assessment by hand or with nurses and other employees, there have been many software packages that have (more recently) proven to effectively and efficiently risk-stratify patients, and these software packages will likely become the norm in the near future as hospitals begin to prioritize and set aside funds for population management efforts. 

Regardless of the method that a hospital or health system chooses to conduct a risk assessment, it is critical that patients who are at a high risk to return to the hospital be identified as soon as possible.

When Risk Assessments Work

Assuming these assessments become a part of the structured in-take process they work when:

  • It’s automated and does not rely on human
  • both quantitative and qualitative (input from family, clinicians, doctors, and caregivers) input are included
  • the health system or insurer separates high-risk candidates and assigns them to a different case manager or social worker

Many health plans are now creating separate pods for high-risk patients that reimburse more and provide additional resources as well. Interestingly, it is often the mid-to-high risk patients that sneak up on a hospital and cost them more than the high risk as many health systems do not employ resources or a plan for the mid-to-high risk. Thus, have a plan for both categories. 

Risk-stratification will become an almost completely automated process and is one of the key components all hospitals should use in identifying those patients who are high-risk to readmit.

When Risk Assessments Do NOT Work

When a hospital or health system relies on humans to do the risk assessment. Why? Human nature. Prioritization. It’s the last thing a nurse or social worker wants to do each day as it is laborious and has no immediate benefit in many cases. 

If you choose to utilize risk assessments:

  1. Have a plan
  2. Automate the assessment into your EMR
  3. Include quantitative and Qualitative date
  4. Have specific categories for each based on their score
  5. Flag their charts so the EMR and ED staff are alerted anytime they are in the hospital or at the doctor’s office
  6. Allocate resources and at least one staffer whose full-time job is case managing those patients
  7. Routine check-ins with the patient, at a minimum weekly phone call or text
  8. Commit to the plan, which means committing budget and resources

Navigating Patient Choice and Steering Regulations

At a speaking engagement a few years back, I stated several times that hospitals that implemented a well-written transitional care brochure and accompanying consent form for the patient to sign were in fact “champions for patient choice.” 

After the presentation, someone approached me and asked, “what do you believe qualifies an organization as a champion for choice?” 

My response? Organizations which develop a brochure that lists their preferred providers (narrow network) and educates the patient of their choices are acting as champions for choice as very few hospitals have patients sign anything confirming their choice in post-acute providers. 

The consent form allows the patient to confirm in writing that they are aware they have a choice in post-acute providers. The consent form also confirms the patient was provided a complete list of providers and allows the patient to consent to those choices in writing once they have done so. 

Hospitals are using the transitional care program, as a means to better keep patients in a coordinated care model. However, regulations requiring that hospitals honor patients’ choices when selecting a post-acute provider and federal anti-steering regulations are still in place. 

These regulations completely contradict the intent of the Affordable Care Act – which is to coordinate care and get reimbursed based on value, not episode-based reimbursement (which was prevalent in the fee-for-service model). This is perhaps the biggest dilemma in coordinating care in a post-Affordable Care Act environment. 

Coordinate care without steering

Let’s start by discussing the intent of the choice and anti-steering regulations. The regulations were created to prevent and discourage unfair business practices. Whether physicians had a financial interest in an SNF, home health agency, or board and care facility, the regulations were created to ensure transparency and patient choice. 

This attempt at transparency was not limited to mischievous physicians, as post-acute providers would place relatives and spouses in jobs with high volume discharges to steer patients to their agency and ensure high volume. 

Anyone who has worked in case management, discharge planning, or the post-acute sector could likely cite several examples of conflicts of interest of this nature that they personally encountered in recent years.

The most important step any hospital or health system can take in addressing the choice and anti-steering issue when designing a transitions program is involving the compliance officer and healthcare attorneys in the process. 

This is one of the most common frustrations amongst providers at present and one of the most frequent questions I get when I am speaking at national events. The best answer I can offer is to adhere to the anti-steering regulation (as outdated and illogical as it is), by getting patient consent and acknowledgment that they are offered a complete list, a choice, of  selected the identified facilities and agencies. 

Enough already with the hospital lawyer gobblyedgook 

When you boil it all down it reduces to a very simple concept: Do the right thing by the patient. 

Our job is to communicate and share with them a plan that will keep them from being readmitted unnecessarily. And really isn’t this why we all got into healthcare in the first place? 

Imagine that the patient is your own mother. What type of communication and candidness would you want from a discharge planner? I know the answer as I was a caregiver for my mom before her passing, Bless her heart. The answer is obvious, you should do the right thing – for your mom and mine. 


Follow the 4 pillars to a successful readmission reduction program

It’s been 12 years since the Hospital Readmission Penalty became the law of the land as part of Obamacare. But for many hospitals, it didn’t become “real” until 2 years later when the first penalties were actually assessed. 

Between then and now, much has changed. The Affordable Care Act itself found itself in the political ICU. But it survived and now looks to be alive and well for the foreseeable future. 

So given that it is the reality, what have we learned?

The most important lesson is that in order for a hospital, health system, or community to implement and maintain a successful hospital readmission program, it really needs to take a multi-prong approach. 

For simplicity’s sake let’s identify the four critical pillars that are the bedrock of any successful readmission plan.

Leadership commitment

It’s a tired trope of any program rollout – without leadership it’s going to flop. We’ve all experienced what happens to so-called priority programs when they lose their change champions. 

All the work and effort is often put aside in favor of a new priority. This is a costly mistake that happens in organisations of all sizes. In order for any hospital or healthcare provider to successfully create a readmission program there has to be an ironclad buy-in and commitment from the very top that creates a cultural commitment that influences every decision up and down the leadership chain, 

Until leadership across the board truly buys in and considers the hospitals’ readmission rate a Key Performance Indicator it will always be vulnerable to the shifting winds. Leadership must make readmission a baked-in priority for every decision.

Re-program your emergency department

Despite the 12 years since the ACA became law, many emergency rooms are still stuck in the “heads in beds” mentality. In order for your readmission program to work, you need to get them on board with value based medicine. 

This means educating your emergency department doctors that the game has changed.  The emergency doctor’s job has transitioned from “justifying admission” to “analyzing and determining if the patient meets criteria.”

Your emergency department doctors must be all-in mentally and in daily practice before the real change occurs. Until you consciously remind them that they were not hired to put heads-in-beds, they will continue to sub-consciously operate as if that is their role – even 12 years after the implementation of value-based care in PPACA.

Preventing all avoidable and unnecessary hospitalizations, not just readmissions

It would be really difficult, laborious, and unnecessary to implement readmission prevention tactics that did not prioritize reducing overall avoidable and unnecessary hospitalizations as a whole.

Besides, that would be missing the point. The point of value-based care is to allow individuals to age and heal at home, self-manage, and only be admitted to the lowest level of care needed when appropriate. 

Engage your community and post-acute provider in the process

One of the most important aspects of a successful readmission program is creating a strong network of partners – who are equally committed to reducing readmissions. 

This network can include community organizations, caregivers, and post-acute providers. Look for partners who are Certified Readmission Fellows – as they will be knowledgeable about the penalty and how they can best help you avoid it. 

The fact is that you can’t do this without actively engaging your third party providers. 

However, community organizations and post-acute providers will not prioritize preventing readmissions if the referring hospital does not. Walk the walk! Refer back to pillar #1 above if you lose sight of what’s important. 

Looking back on 12 years of Obamacare’s Readmission Penalty

In 2010, President Obama passed the Patient Protection and Affordable Care Act of 2010 (PPACA) – often referred to as Obamacare. Included in that legislation was the introduction of the Hospital Readmission Penalty. 

At the time, few operators and physicians were focusing on the topic of reducing avoidable hospital admissions and the body of research was small. 

This was partially why there was not much movement from hospitals seeking to reduce avoidable readmissions in the few years after PPACA passed. 

Then two years later in 2012, the first penalties were assessed. That’s when things really began to  change as hospitals realized this could really impact profits going forward.  

When hospitals began receiving their first fines, or Medicare withhold (or claw-back), is when they really started paying more attention. 

But still, few were moved to real action. 

And now, ten years after those first penalties were assessed, it’s time to revisit the penalty and how it is continuing to impact the delivery of healthcare in America. 

In 2015 I wrote a book, Readmission Prevention: Solutions Across the Provider Continuum, which worked as a user-friendly guide for healthcare operators and doctors that went over real tactics to prevent unnecessary hospital readmissions and avoid the penalty.

While many of those tactics are still incredibly useful, the intervening years have led to a  broad range of best practices, readmission prevention tactics and case studies that can help operators realize \a significant decline in their hospital readmission rate. 

More importantly, we have made great strides in preventing the majority of avoidable hospitalizations – not just readmissions. 

In doing so many hospitals have increased their efficiency and profitability.  

Today it is more important than ever to include post-acute providers as partners in preventing avoidable hospitalizations. When hospitals find the right partner of choice. Those post-acute providers that do it well are becoming increasingly popular as ]managed care organizations narrow their post-acute provider networks more aggressively – leading to more streamlined and profitable relationship for all. 

I spent ten years as a hospital Chief Executive Officer and health system Vice President. 

Caring daily for the neediest of the needy, including homeless and adult psychiatric patients, shaped me as an administrator. And just as I managed safety-net hospitals on a shoe-string budget for many years – I see the readmission penalty as an opportunity for hospitals not an albatross – it just takes effort and a commitment! 

How it began: Head in a Bed and Unintended Consequences

To simplify the readmission problem, the hospital reimbursement methodology used prior to 2010 was referred to as the Medicare Fee For Service model (FFS), which incentivized facilities, including hospitals, and nursing homes to admit patients. Medicare FFS also incentivized physicians to admit patients to the hospital, skilled nursing facilities, long-term acute care hospitals, acute rehab hospitals, and home health agencies, by reimbursing them each time they admitted a patient to one of these levels of care. Further physicians would be reimbursed every single day while caring for them. Likewise, hospitals were incentivized for admitting patients as well as every other level of care. 

Quite simply there was no system of checks and balances under an FFS model. I have come to call this era, “the Fee For Service free-for-all”. The system’s unintended consequence was that it encouraged over-utilization of patients at all levels, by both doctors and providers. 

Thus, more people were admitted, additional unnecessary tests were ordered on patients, and patients often stayed in hospitals and nursing homes longer than necessary. And as a result, costs sky-rocketed year over year. PPACA was an attempt to undo those trends and reverse the motivations of doctors and hospitals. 

While the fee-for-service free-for-all was a lucrative time for many hospitals, facilities, doctors, and home health agencies, it ultimately put our federal government in a compromising position as funds for healthcare ran dry. 

While far from being perfect, PPACA was a historic attempt to change how care is delivered in our country. When you look at PPACA as a whole, the fact remains that the desired model is a coordinated care model that makes fee-for-service a thing of the past. 

This model is designed to reimburse physicians and providers based on value and quality care, as opposed to episodic care when an inpatient needs to be hospitalized. It is a model that incentivizes caretakers at all levels to collaborate to improve outcomes instead of viewing and treating all patients simply as a commodity.  

Unfortunately, both with generic readmission efforts within a hospital and disease-specific programs, history has proven that successful efforts are often short-lived as they are championed by one or two influential leaders, and when they move or to a new role – the enthusiasm for change leaves with them. 

This trend is unfortunately all too common in hospital management nationwide. The flavor of the month or crisis of the day in the hospital often becomes a bigger priority, and since readmissions itself are contrary to the hospital revenue model, it’s an easy one to let go for many hospital managers and Directors when the C-Suite quits prioritizing it. 

While this is not always the case, hospitals are penalized for readmissions in a series of specific disease categories, which originated with three disease-specific categories and grew to five categories in the fiscal year 2015. 

Hospitals are also evaluated on their all-cause readmission rate for Medicare fee-for-service patients. Hospitals are not financially penalized based on each disease-specific readmission. 

Therefore, hospitals and health systems should be effective in implementing comprehensive readmission prevention programs by taking a facility and organization-wide approach to the problem.

The fact is that even in 2022, with value-based care models continuing to be introduced and the gradual phase out the FFS era, the majority of hospital revenue is still derived from putting a head in a bed. 

Not-So-Fun Fact: CMS recently announced that it was punishing and penalizing 2,499 hospitals nationwide for excessive readmissions. The penalties were capped at a maximum of 3 percent of a hospital’s annual Medicare spend but averaged .64 percent for the fiscal year 2022. In its tenth round of annual payments, Medicare fined approximately 47 percent of all hospitals in the United States with 39 hospitals receiving the maximum 3 percent fine in the fiscal year 2022. In 2018 for example, the average hospital fine was $217,000. 

Finding ways to reduce avoidable readmissions is simply good business. Finding the right post-acute care partners is one of the best ways to do it. And beyond saving money – it will also help you streamline your tendering process and save your administrative headaches. 

If you have questions about any of this please don’t hesitate to book a free 30 minute consultation.

Re-Program Your Emergency Room

I am often asked, “If we were to only do one thing to reduce hospital readmissions, what tactic would you recommend?” 

My answer is simple. “Re-program your emergency room.” 

It’s that simple. 

Since releasing my first book on the hospital readmission penalty, Readmission Prevention: Solutions Across the Provider Continuum, I have been invited to keynote on healthcare topics around the country and across the world. 

Whenever I exit a stage and network with other healthcare executives, one of the most common topics I’m asked to address is what can they do to avoid the readmission penalty.  

As a former hospital CEO myself, I’m acutely aware of how our healthcare system operates and I’ve watched how it has evolved over the decades. My experience has led me to think about the challenges and see where the opportunities are for improvement. 

So whereas simply saying “re-program your emergency room” sounds great as a bumper sticker slogan. It’s not very helpful unless you know what it actually means and how you can actually do it within the existing constraints. 

So what does “re-program your emergency room” actually mean? It means educating your emergency department doctors that the game has changed… it is no longer a heads in beds play, where the doctor’s job is to find “justification” to admit. The emergency doctor’s job has transitioned from “justifying admission” to “analyzing and determining if the patient meets criteria.”

Many doctors don’t want to hear this but in many ways, CMS has eliminated the doctor’s opinion from the process and made qualification of admission to hospitals criteria-based – grounded in quantifiable test results and outcomes. 

There is no way to sugarcoat it, re-programming your emergency physician group – a hired outside physician group – is going to be difficult. Why? Well traditionally in the fee-for-service era, most hospitals picked the emergency physician group that convinced them they could admit the most patients – which translates to the most revenue – heads in beds! 

Remember, the name of the game in a fee-for-service world is “justify and admit.” The new rules penalize that type of strategy. The new rules are “Analyze and determine if the patient meets the established criteria.” Doctors can still write admission orders for patients who do not qualify, but payment will be denied, and collecting any reimbursement for that patient is almost always going to be a long and tedious process that is seldom profitable in the end. 

Thus, re-programming the perceptions, practices, and deep-rooted, long-standing habits of emergency physicians can be a lengthy, but necessary, process. The training requires much repetition to get the emergency physician out of the “heads in beds” mindset because that’s how they were trained. 

But if you can achieve this shift and your hospital prioritizes value-based care, while eliminating avoidable hospitalizations you will reduce expenditures, administration costs and costly readmission penalties. 

If you have questions about any of this please don’t hesitate to book a free 30 minute consultation.

Real Talk with Dr. Josh Luke

PSJH and the Future of Health Channel on Dash Radio recently began a new podcast partnership with Dr. Josh Luke. Based out of Southern CA, Dr. Luke has traveled the world sharing the well-kept secrets of the healthcare industry and educating families and businesses on how to escape the healthcare affordability crisis. Dr. Luke is relaunching his award-winning show Dr. Luke’s Waiting Room: The Healthcare Authority Podcast under the Future of Health Channel with a new name: Spend Less on Healthcare with Dr. Josh Luke.

We asked Dr. Luke to tell us a little more about how he got started on his path, why he believes his work is so important, and what drives his continued expansion in the healthcare financial arena.

Q: What is the primary drive behind doing the work you do?

A: I was working in sports marketing as my late grandmother was bouncing between an assisted living and nursing home, and I grew frustrated by her inability to access some basic things she needed. So I switched careers to become a healthcare administrator. I became a hospital CEO at age 32. I learned the industry from seasoned executives that saw healthcare hyperinflation spiral out of control decade after decade, and no one seemed to be concerned as long as the hospitals were thriving financially. It didn’t feel good to me that the majority of the executives were completely disconnected from the fact that American businesses are being bankrupted by the cost of providing employee health benefits, and American families are being kept from achieving their dreams while basic access to care has grown to cost more than $20,000 a year per family — before even seeing a doctor or getting one prescription.

By the time my mom was diagnosed with Alzheimer’s Disease in 2010, I realized that an entire generation had passed since my grandmother’s experience and the system had gotten worse, yet more expensive. I decided to leave the hospital C-Suite and use my platform as a social entrepreneur advocating for health systems to do the right thing: serve their communities and offer access to affordable care. Providence is one of the few health systems I would even consider partnering with as even in this day and age, very few health systems are putting their community first.

Q: Can you describe any major turning points that moved you from hospital CEO to Speaker and Author?

A: I always joke that I was never able to keep a job for very long, which is only partially true, but the point is I am a truth teller and am driven to add value and innovate. In American corporate culture that doesn’t always bode well. By the time my first book Ex-Acute: A former hospital CEO tells all on what’s wrong with American healthcare hit #1 best seller on Amazon, my social media following had already grown dramatically. But that took it to the next level and I started getting more speaking requests, even internationally. LinkedIn asked me to write for their Pulse healthcare community, and to do daily videos when they launched LinkedIn video in 2017. I was writing a column for, and then Forbes asked me to write Health-Wealth: Is healthcare bankrupting your business? It went to #1 on launch day on Amazon — that was cool.

Q: What keeps you motivated to continue helping people?

A: I have been blessed to have had some great work experience, as well as strong communication skills. Between writing columns, posting on social media and hosting a podcast, my entire focus now is on helping American families learn to Spend Less on Healthcare.

I created a free list of Ten Tips to start saving for families as well as a new Personal Healthcare Spending Reduction Tool. The new tool asks a series of questions, and our team then analyzes the answers to find out whether the user qualifies for assistance. If qualified, we guarantee that we will save your family more than $5,000 on healthcare costs in the first year as long as our recommendations are implemented. The tool was created by our not for profit organization Health-Wealth to help Americans Spend Less on Healthcare, and it has been wildly popular since its release in January 2020. We have seen large group participation — including churches who’ve suggested the tool to entire congregations — to answer the questions on the tool to start saving. I am hopeful that this will ultimately be my legacy; being America’s Healthcare Affordability Authority.

Q: How do you keep your sense of humor around doing the work that you do?

A: It’s been fun getting requests to be the main, entertaining Keynote Speaker at large association events, as for a while I was thought of as “just a healthcare guy.” I never particularly considered myself to be a comedian, but when you speak publicly as often as I do, you take note of when the audience laughs and engages and you add those anecdotes to your script for every event until the whole thing is entertaining and engaging. I have been blessed in that regard. Now when I am hired to do a keynote, I offer 250 copies of my book for audience members and host breakout sessions on a topic of the hosts choice as well, so I get to do a little bit of both! Oh, and people have started to ask which of my crazy sports coats I’ll be wearing even before I speak at an event — that keeps it amusing too!

Q: Thank you for sharing about yourself and your journey, Dr. Luke. Before we wrap up, can you tell us why your podcast Spend Less on Healthcare is important, and what people are going to learn by listening?

A: I’m on a mission to teach American families and individuals how to obtain basic access to high quality care, at an affordable price. By tuning in each week, listeners will get to hear simple tactics that can be implemented overnight to help them and their families eliminate wasteful healthcare spending. Each podcast brings a new Quick Tip of the Day to start saving, as well as stories from guests who share other ways that you and your family can start spending less on healthcare today!

Don’t miss Dr. Luke’s shows on PSJH’s Future of Health every Thursday at 6pm, for the new Spend Less on Healthcare with Dr. Luke, and Thursdays at 7 pm for a throwback of Dr. Luke’s Waiting Room here:

Closing Hospitals Sales in the Value-Based Care Era

The hospital delivery model has changed. With the implementation of alternative payment models as mandated by the Affordable Care Act, hospitals are being forced into an insurance model. And with the shift to the insurance model, staffing firm sales teams have been forced to adjust.

Why do we call it an insurance model? Well, hospitals are being forced to convert Medicare patients into Accountable Care Organizations and bundled payment programs. Much like Medicare Advantage plans and HMOs of old, in these models, the payer, which is now the hospital in many cases, receives a flat amount (per diem) at the beginning of each month to pay for each member’s care. After paying for necessary care, whatever cash is left at the end of the month is called profit. In short, cost is everything in the insurance model; it is the dominant driver in purchasing decisions.

Enter the staffing industry sales team, which now must approach hospitals in a different way. Has your sales team adjusted? Here is a series of questions to help you answer that:

  • Have you identified who makes the buying decisions now?
  • Does your prior contact now have to seek approvals before purchasing?
  • Do you know there spending limits?
  • Do you know the clients fiscal year end date?
  • Do you know when pay day is for employees and how that impacts cash flow and spending approvals?
  • Who is your internal champion? How many physician allies do they have?
  • How much clout does your champion have in the board room?
  • Who are the two most influential executives at the board table beyond the CEO?
  • Are you wasting your time targeting the CEO & CFO?
  • Is the hospital a for-profit, academic or not-for profit hospital?
  • Do you know the decision sequence based on hospital type? Which is more of a priority?
    • Price
    • Quality
    • Operational flow
    • Service & responsiveness
  • Do you know the not-for-profit secret?
  • Have you seen the hospitals required community needs assessment?
  • Is peer-to-peer selling necessary when targeting nurses or doctors at this hospital? If so, do you have nurses or doctors on your team? Have you considered some creative ways to add a nurse or doctor to your team and stay under budget?

When the insurance model came to the fore, staffing providers that were traditionally higher quality and price-point vendors were finding themselves left out of sales they had routinely closed simply because they did not offer the lowest price. After multiple requests from solution providers for guidance on how to move the conversation past price, the not-for-profit National Readmission Prevention Collaborative created The Selling to Hospital online Masterclass.

Last week’s SIA Healthcare Staffing Summit in Las Vegas featured my “Selling to Hospitals” preview session. Attendees of the event, and now Staffing Stream readers, can complete the masterclass at a discounted rate of $299 by entering code SELL$100 when registering online by Dec. 10.

Alternative Health Insurance Models

With insurance costs sky-high and reform questionable, other insurance options are popping up and become first choice for more people. Most families struggle to afford $700-$2,000 average monthly payments, sometimes paying more for health insurance than their house.

Diane, for example, is totally disgusted and very typical insurance shopper. At 27, she has a good job, lives in a decent apartment, and is finally getting her life settled. But, her job doesn’t offer health insurance, so she’s left alone to pay for it on her own.

Like many other young professionals, she’s faced with a huge decision:

Nearly $1,000 a month for health insurance she will barely use or go without.

But, if she ever ends up in the hospital, she could be faced with a lifetime of crippling hospital bills.

Facing this kind of dilemma is a daily struggle for millions of people and families throughout the US. Including mine. We went through a job transition and chose to go without health benefits for half a year. My wife and I had three kids in middles school at the time but with no stable income we just could not fathom paying almost $1,500 a month for COBRA benefits.

Different Ways Around Health Insurance

Like millions of other people in the United States, we’re looking at various ways of affording hospital bills without having to resort to high-cost healthcare. It’s not an easy choice, because some of the options do not cover extended hospital stays or treatment for diseases and some only provide discounts.

But, these are the options I want to make people know and use because they work. 

The uncertainty in the health care economy prompted a resurgence of alternative health insurance models people are flocking to by the millions. No longer fringe movements, many of these models are now standards in certain areas. 

You can also find more details on these alternative insurance models in my book Health-Wealth for You: 11 Steps to Save Big & Live Healthy throughout Part 3.

Health Savings Accounts

Many employers are opting for Health Savings Accounts (HSA) for their employees. These are specific employer-provided savings accounts that set aside a certain amount of the employee’s paycheck and/or employer contribution for the sole purpose of helping pay for medical bills. 

These became a much more popular option as insurance premiums skyrocketed. Employers began choosing higher deductible plans and setting up HSAs to offset the deductible. When employees paid for their medical care, the health savings account reimbursed them.

Will This Work for Me?

If your employer offers insurance and an HSA, most financial advisors will encourage you to contribute significantly to the HSA. It helps offset costs and used for many services such as nutritionists, massage therapists, and alternative medicines.

Some banks and credit unions will allow you to set up an HSA without your employer under certain conditions. This works very well for the self-employed or for those whose company does not offer health insurance.

Cost Sharing Community Models (CSCM)

One of the next steps away from traditional health insurance is having cost-sharing models that prioritize the use of virtual doctor’s visits, apps and technology, and remote monitoring. Many CSCMs help their members by offering discounted services, especially for patients who are paying cash.

Sedera Health is one program. Members of Sedera Health self-pay for the health care costs, and Sedera helps negotiate what the patients will pay. This bill negotiation process can significantly reduce the cost of many standard and emergency procedures. It’s also excellent for people who take a small number of regular prescription medications. Similar models exist for dental and vision programs. 

I regularly speak to organizations and businesses that want to offer their employees options to expensive and complicated insurance programs. Personally, I am a member of Sedera through a cost sharing model called Fit Health. If you’re going to explore this cost-saving measure in your workplace, please visit to learn more.

Will This Work for Me?

For people who are in general good health and do not often need to see the doctor, a CSCM works very well. It can significantly reduce your costs for health insurance. As new regulations are taking place and basic, emergency only insurance begins to re-emerge, the cost-sharing model will become more popular.

Faith-Based Cost-Sharing Models

Faith-based cost-sharing models are becoming more popular in the Mid-West to the West Coast of the US, although they are available through most religious organizations. Membership is usually limited, having to be part of the organization’s faith, and members are often required to live by specific standards. However, if this option is available to you through your church organization, it’s an option that can benefit you in the long run.

Most faith-based models have members pay a regular monthly due to a community account. Then, as members incur medical expenses, they apply to this community account for reimbursement. Members take a slight risk of not being reimbursed, depending on the status of the fund, but usually gain their money back.

Will This Work for Me?

If you belong to a faith-based community that offers these programs, it is worth your time to investigate how large fund typically is and what the repayment policy is. Currently, there are hundreds of faith-based cost-sharing models throughout the United States and well over a million people belonging to these groups. They are successful at helping people with bills and costs. Christian Care Ministry gives a great break down of their service and how it would work for you.

Value-Based Insurance Design (VBID)

VBIDs are specialized health care tactics that prioritize high-value, proven procedures.  This model emphasizes shopping around for the best value for specific procedures, not always the lowest cost.

Because the provider of this type of insurance requires prices and clinical outcomes to be specific and transparent, patients can choose between different providers and procedures. Because the rates, co-pays, and cost of the patient are available for review, healthcare costs are driven down with the right type of choices.

For example, the company Walmart has chosen the VBID for many of its procedures. When it comes to knee problems, Walmart fully supports its employees opting for knee replacement surgery. However, they’ve negotiated with various institutions to provide high-value services for the lowest cost. Employees can choose to use Walmart’s selected facilities, often with minimal co-pays, or other facilities with a higher co-pay. For some people, it’s a natural choice, but for others, they may have to travel a significant distance to use a preferred facility.

In Episode 21 of my podcast Dr Luke’s Waiting Room, Doctor Bill Hennessey, founder of Pratter, Inc. created a tool for companies to know how much they spend on various procedures at different facility. It helps people price shop and know the real value of their surgery. 

Will This Work for Me?

If you’re part of this type of system, it can save you money. You’ll have to do more work before procedures to choose the most cost-effective and highest value treatments. In the long run, for higher-priced services, it can save significant amounts of money.

Private Membership Programs

As insurances are driving up the clinic cost of many routine medical procedures and requiring extra personnel to submit insurance claims, many of these small clinics are opting out of accepting insurance altogether. For some, they face the choice of abandoning insurance or going out of business.

So, many created their own third choice: they’re offering a self-pay membership program. This is one insurance option that I support and belong to.

These membership programs offer a set number of services for the members to take advantage. Many of these programs charge a fixed monthly fee and provide routine health checks, urgent care visits, minor in-office surgeries and procedures, and other accessory medical needs. Membership to many of these doctor’s offices ranges from less than $50 per month to several hundred.

And it’s not just small doctor’s offices that are offering the service. Larger hospitals are also exploring this option and may be able to provide a broader range of services. Most of the time, the doctor’s websites will inform you if a membership option is available.

Will this work for me?

For most people in decent to good health, this is a very reasonable alternative to health insurance. People can get the routine medical care they need, the prescription medications, and minor procedures.

Catastrophic Health Insurance

With all the options available, and with changing regulations, catastrophic insurance may become an option in the near future. Coverage that supplies just emergency medical treatment, lengthy hospital stays, and extensive surgery, without providing any routine care, may become an option again.

If you choose an alternative health insurance model, be sure to have funds set aside for emergency care. Most alternative models do not cover emergency care, although they are perfect for routine care.

With the rapidly changing landscape of American health insurance, we can only guess where things will go. Remember, in the last decade, we’ve seen insurance costs rise nearly 1000%, force everyone to have insurance or be fined, take medical procedures they won’t ever use (maternity), and have over a thousand different regulations enacted and redacted. 

We can only wait and see what the future will hold. Taking control of your Health-Wealth maybe the only secure financial decision you can make.

Preventing Unnecessary Medical Care 5 Steps To Helping Your Employees Become Engaged Health Care Consumers

The days of trusting your doctor to take care of all of your health care is over.

Between doctors used to Medicare paying everything (which lets them over-prescribe and over-charge) and medications and health insurance cost going through the roof, the only option to save money on health insurance is to engage your employees into make smarter choices.

You need to become partners in this fight!

In my book, we discuss multiple different apps, services, and cost-saving measures that will help you reduce your insurance costs and save your employees some money. See Health-Wealthfor Youfor more information.

The first step in saving money…

Getting your employees to become Engaged Healthcare Consumers.

Being an EHC means your employees know what’s going on with their health. They make informed decisions about medical tests, treatments, and prescriptions, and look outside of the traditional allopathic medicine community for alternative medicines.

It’s about personal responsibility – take care of yourself and your family first!

Imagine being able to talk with a doctor and get all of the options available to you, not just what your insurance will cover. Imagine being able to shop doctors, procedures, and medicine like you would for shoes or a new TV.

As new legislation comes through by executive order and Congress, people will be able to make informed choices and save money. But, like everything else with the government, it’s going to take time to implement, sometimes years.

We want to save money right now.

Start taking these steps to help your employees become Engage Healthcare Consumers. When they see the cost savings, it will be easier to implement bigger and better strategies with their full cooperation. And, some of these will help save you thousands of dollars on your health care costs.

1.    Discuss Health Insurance Premiums with your Employees

You and I both know that for every employee you insure, it cost you between $1,100 and $1,500 per month. How much are you having your employees contribute? 5%, 10%?

Chances are, your employees have no idea how much their insurance plans cost. All they’ve seen is the deductions out of their paycheck and the deductible at the office. And those keep going up – creating resentment.

It’s time to be upfront with your employees and let them know the actual cost of their health insurance. Discuss the different plans and the different costs, and you can get your employees on your side.

They may even have suggestions you haven’t thought of yet!

2.    Provide Apps & Services Directly

In my book, we discussed several services and apps designed to help people take charge of their medical care.

One of the apps you can provide your employees is called Calm. It helps people with frustrations, emotional upsets, and provides basic counseling. When you provide this app to your employees free of charge, they can engage with low-level counseling that will save hundreds of dollars in insurance costs.

Another option is paying for life coaching, massage therapy, and other holistic medicine out of pocket. Healthy, happy employees work harder and cost less. Providing free 10-minute chair massages from a licensed massage therapist costs significantly less than an insurance claim for a wrenched back.

In 2005, a study showed that back pain sufferersneed $2,580 more in medical care per year and nearly 80% of all people will suffer back pain. Plus, time off, lost labor, and reduced productivity cost you money.

Compare that to a 10-minute chair massage once per week costing $520 per year. It may save you over $2,000 per employee!

3.    Discuss Your Employees Health Issues (Legally)

Imagine if you knew your employees had a potential health problem before they caused problems? What if you could make a few minor changes and reduce them taking time off, visiting doctor after doctor, and driving up insurance costs?

It’s illegal to ask about employees medical conditions prior to hiring unless it interferes with their work and safety. It’s also a touchy area legally to discuss it after they’re hired.

But, if you ask them to share with you any medical problems to resolve right now, you may be able to work through some of them, make adjustments, and provide a better working environment. Just be sure to let them know that it is not a requirement they do so.

Pregnant and breast-feeding women have one of the most significant challenges in today’s workplace. The top discrimination lawsuits are from pregnant women over some really ridiculous reasons..

Let’s take for example a woman who is pregnant with her first child. She will see a doctor every couple of weeks, need more frequent bathroom breaks, and may require a different chair to accommodate her growing size and ability to move. For most businesses, that’s a really easy solution and makes you and the new mother happy.

If you start a dialogue with her early on in her pregnancy, you can communicate different services you can offer to help manage her needs during pregnancy long before they become a complication.

By being open and honest about your employee’s needs and what you can do, you avoid bad feelings and potential lawsuits.

4.    Provide Options for HSA, Alternative Medicine, and Self-Care

The fastest growing area in healthcare is Complementary and Alternative Medicine. Set to exceed $10 billion in out-of-pocket payments, people are taking full financial responsibility for different healthcare options, like massage, acupuncture, and supplements.

Massage therapy is the largest provider of alternative medicine. It’s also one of the easiest to get and cheapest to provide. As Ken Lee, owners of Kenneth Mark Mobile Massage, who specializes in taking massages to the people homes and offices, says: “Employees love massage day [from their company]. It give them a chance to de-stress, reset, and even just a few minutes in the massage chair can make their day better. A clear headed and refreshed employee returns to work feeling renewed.”

Your various options for self-care go way beyond just massage. You can provide a Health Savings Account for your employees to use for nutritional services, supplements, and other medical expenses not covered by your insurance. Not only is this a benefit for your employees, but it’s also the tax write-off for you.

5.    Negotiate with Local Doctors and Hospitals for Direct Pay Care

A growing alternative to traditional insurance is negotiating payments directly with doctors and hospitals. You pay for a certain amount of services or have a set fees for services to pay the doctor directly. By eliminating the headache of insurance paperwork and delayed payments, you can get significantly lower costs.

For one of my clients, we recently negotiated with a large health system to cover basic medical care, routine appointments, and some of the most common surgeries their employees obtained and ended up staying close to $3 million a year in insurance costs.

I don’t think you need to be a large company to save this money. Small businesses of all sizes are negotiating with different providers for services of care. If you would like more information, please call or email me directly.


The top principle of lowering your healthcare costs is getting your employees engaged. This means you need to talk with them and let them know what is going on with their health insurance and various costs. You need to get your employee to take responsibility for their health and work as partners to save money and time.

Engaged Healthcare Consumers are healthier, harder working, and save themselves and you money.