9 Game-Changing KPIs Every Health Startup Needs to Consider
The fluid healthcare ecosystem, fast-paced regulatory evolutions, growing consumerism and shifting reimbursement models are impelling companies, particularly startups to challenge the status quo and embrace the coveted disruption.
In fact, the rapid advancements in technology in providers have increasingly resulted in a fragmented landscape, disjointed clinical systems and a vast array of devices such as wearables.
Not surprisingly, they posted large volumes of siloed – even conflicting data – across multiple channels.
With mounting governance pressure and the pressing need for accountability, succeeding in the healthcare segment is now heavily dependent on measurable KPIs to keep track of how things are progressing towards long-term objectives.
But as always, the key to developing a robust foundation for sustainable success in this competitive domain is to identify and applying the best suited KPIs and subject them to the SMART test.
• Specific – Define the item under evaluation
• Measurable – Availability of scalable data
• Achievable – Metrics being chosen must not interrupt important workflows
• Result-based – The KPI must have a credible effect on performance
• Time-bound: Data must be available for use within a stipulated time-frame
The Business case for Metrics
Not many healthcare companies are able to successfully harness the potential of an effective KPI – which is why their data is often stuck between unrelated systems and departments.
In turn, this makes it hard for all stakeholders to align with the big organizational picture: how well the firm is doing, where progress is bottlenecking, what steps need to be taken to overcome them.
Very often, this stymies growth by slowing down the decision-making process and preventing necessary operational and financial changes from happening.
To that end, one of the best ways of making a data-driven, well-informed decision is to leverage an easy-to-understand yet sound metrics and access them in a single dashboard so that critical data points can be utilized uniformly as opposed to disparately.
How Metrics Can Help Startups
Metrics allow startups to:
•Monitor important KPI metrics
•Observe performance data
•Access information needed to make the necessary improvement
• Better address the needs of patients
•Lower wait times
•Bring down readmission rates
•Offer better quality healthcare.
KPIs for the Healthcare
While it is true that each organization has its unique goals and needs, the following metrics are generally the most vital in the healthcare domain.
This information can give organizations vital cues into the information that are necessary to make changes across departments. For example, if admission re declining, startups can consider scaling up their marketing budget to get more patients – or they could reduce the number of positions in order to save money.
If the opposite is happening, they can buy fresh equipment, hire new staff members and deploy advanced systems to cope with the growing number. Before doing so though, ask the following questions:
•How many patients are coming into the facility to seek treatment during a fixed time frame?
•Are those numbers rising or declining compared to last month/year or 2 years back?
Thankfully, this information can be used for comparing organizational performance with national or even international trends.
This refers to the number of patients who come back to the facility soon after having been seen. Do the rates have differences between various departments? If yes, how different are these numbers?
This data must not be undermined as it can provide crucial information on healthcare quality. Loopholes, if any, can be identified by analyzing the readmission rates.
For instance, high rates may imply that the department needs to spend more time with the patient or focus extensively on treating them well. It could also mean that the department needs further impetus or is understaffed.
Either way, this information can drive game-changing departmental and organizational changes to help startups improve patient outcomes.
Referrals can be used as a direct loss-making proposition for healthcare startups. This data point can be analyzed by assessing the number of patients who are referred to other facilities or providers.
When that happens, it basically means that you are sending business to your competitor. In addition, it indicates patient dissatisfaction which means they’re unlikely to come back to you for the purpose of repeat business.
In healthcare, referrals must be tracked monitored closely by new entrants so that they know when to buy additional equipment, hire specialized providers and make other changes that can prevent patients from being referred out.
As innocuous as it may sound, the number of organizations – even those that are experienced players – who ignore this key KPI is stupefying. For starters, ask yourself the following questions:
•What did patients think of their stay, provider or overall quality?
•Were they satisfied with little things such as their meals?
•How satisfied were they with their follow-up care?
Again, this data offers intelligent insight about all business-related pointers that a startup must look into with avidity. Inevitably, a low patient satisfaction rate suggests that the company must take a hard look at how they are executing their business idea or handling their patients.
Since it is a given that dissatisfied patients are neither likely to come back nor refer their loved ones to the facility, patient satisfaction has got to be the number 1 priority for any company. Any declines in this vital KPI must be remedied with alacrity. If the need arises, a company must not hesitate to make changes in staffing, quality of training or the setup itself.
As a budding startup, you’re more than likely to rely on investor funding to finance your growth. To that end, one key area where stakeholders may focus is on CAC or Customer Acquisition Cost.
This KPI encompasses the total expenses involved with onboarding new customers. An increasing CAC suggests that you are unable to attract your audience. Else, it could be possible that you are engaging in less than ideal ethics and practices, something that is paramount in the healthcare industry.
Most medical professionals simply don’t have the time or inclination to get familiar with a new software application. If that is the case, it is a good idea to leverage a customer success team to deal with the situation.
Are you passionate about serving your patients with your cutting-edge solution – technical or otherwise?
If yes, keep a tab on the number of patients you’re serving as well as the periodic claim count to ascertain if your customers are growing. Alternately, you could get service types bifurcated to uncover unique ways of augmenting your operations
Other lesser-known metrics
Average Insurance Claim Processing Time & Cost – this KPI averages the amount of money and time a company spends on processing insurance claims. A low average means that the startup gets its payment faster and the quantum of cost on patients is also less.
Average Treatment Charge –denotes the average amount charged by a facility for medical treatment. Notably, this figure can be segregated by treatment type or be used as a collective average of treatment categories.
Medication Errors –gauges how many times an error has been made in prescribing medication. Importantly, this is inclusive of when and how often a mistake is made in terms of patient or dosage and is relevant for inpatient as well as outpatient services.
Claims Denial Rate – offers intelligent information about the efficacy of a startup’s revenue cycle. Here, a low CDR means that the company is able to spend more time and energy on improving patient care than being bogged down by avoidable paperwork.
Healthcare is a tough terrain to conquer, which is why it’s worth sticking to these credible metrics that can help you create value over time. Let’s face it – even the most tech-savvy digital healthcare startups will invariably find the need to go back to the basics and do the hard yards. So arm yourselves with these KPIs and scale new heights of success!