By Curtis Gattis, CEO and co-founder of LeadingReach
The referral-to-appointment ratio (RTA) is the most important metric in healthcare that no one is talking about, until now. What is RTA? It is the “conversion rate” on a transition of care. Said another way, it is whether or not the patient received the care they need, be it a traditional referral to a specialist, an order for ancillary services, or a surgical procedure. Every other industry scrutinizes, manages, and ultimately owns conversion metrics across their entire business — at least the most successful ones do. Familiar names like Amazon, Facebook and Salesforce can tell you their respective “close rates” across all of their various channels and go-to-market strategies, in real time.
Why should healthcare be any different? Especially given the fact that healthcare affects everyone at one point or another. RTA is the foundation for value-based care organizations, allowing them to confidently take on more risk while at the same time empowering those who are focused on the traditional fee-for-service model to succeed. A high RTA benefits all stakeholders by getting patients the care they need in a timely manner and by supporting current, and most importantly, future healthcare delivery models.
“Close rates” are usually associated with Fortune 500 companies and their valuations and stock prices. The reality is that any organization, even charitable ones, have to manage a balance sheet and that means taking in more money than they spend, at least on aggregate.
The challenge for the healthcare industry has been the inability to track simple conversion metrics such as how long it takes to acknowledge receipt of a referral, how many referrals actually convert to patients walking through doors for appointments, why patients don’t convert to appointments, and the average number of days it takes to get appointments. For both patients and business owners, these metrics are perhaps the ones that matter most.
At the root of the problem are dozens of multi-billion dollar EHR companies that choose not to freely share information and the archaic means of data transition that they support – primarily faxing and phone calling. Fortunately the winds of change are empowering healthcare organizations to move away from faxing in favor of better, more connected and more accountable transitions of care management.
In the meantime, as the days of faxing diminish at the pace of healthcare, there is still a dire need for better “patient pipeline management.” Every lead, aka referral, counts toward the bottom line, and every referral represents a human in need of care. These are not mutually exclusive goals.
Why is measuring RTA important for a single doctor specialty practice? It helps manage a physician’s better. Why is RTA important for large publicly traded health systems? It will help them drive shareholder value. Most importantly, why is it important for each of the patients that they serve? It will get them the care they need in a timely manner and give them the best possible chance for a happier and healthier life. This is the main motivator for many to join the healthcare industry in the first place.
RTA does that and much more, including tracking and owning the close rate to ensure organizations can compete and maximize their opportunity in the market. It also ensures that those who are participating in value based care can maximize the chance that their patients are being seen in the appropriate setting of care according to their unique plan designs. It does this by holding a defined network accountable to seeing their patients in a timely manner, closing the loop, and communicating clearly about their patients’ care. These basic behaviors of an accountable handoff from one setting to another have proven to reduce cost and drive quality and value throughout the entire ecosystem.
When considering the benefits of managing the patient pipeline for those whose business is rooted in the fee-for-service model, RTA is the most important metric that can be tracked. Yet very few ever think about it, much less put in the work to improve it over time. To operate a specialty clinic, imaging center or hospital network, what metric could drive more revenue than the RTA? What’s the easiest way to drive more surgical volume into an ambulatory surgery center or hospital? Get more appointments at the clinics that send into those venues. The ROI can be astronomical and yet this basic discipline is not managed or tracked in almost any specialty care or ancillary care setting. This is bad for business as well as patients’ health.
The industry is changing faster than ever due to the pandemic, and this has accelerated many key parts of our industry to adjust to a drastically different world. As we see new innovations in the industry continue to unfold, acknowledging that tracking a “close rate,” or the RTA, is not a bad thing at all. In fact, it should be the foundation of our future healthcare delivery model, whether anyone wants to talk about it or not.
Curtis Gattis is the CEO and co-founder of LeadingReach. With 20 years of experience conceptualizing new products, bringing them to market and scaling software companies, Gattis brings a unique perspective to the healthcare industry. Find him on LinkedIn.
Founded in 2014, Austin, Texas-based LeadingReach has bootstrapped its way to success and proven out its solutions to critical industry challenges such as interoperability and care coordination. Learn more at www.leadingreach.com.