Accreditation costs of Healthcare Organizations

Experts in the field claim that the activity of accreditation represents a key mechanism to evaluate healthcare facilities' performance and enhance care delivery safety and quality. The term "accreditation" describes the external assessment process for evaluating hospitals' and other healthcare centers' performance by studying their adherence to a number of pre-established, well-defined written performance benchmarks. It aims at encouraging ongoing quality improvements instead of merely upholding least-required performance levels. Accreditation also refers to public approval that stems from a healthcare institution's achievement of certain care standards, validated following an autonomous external organizational performance appraisal. (Jaafaripooyan, Agrizzi & Akbari-Haghighi, 2011). This paper addresses the purpose of accreditations and related costs.

A summary of the purposes of accreditation and accreditation standards

Organizations duly accredited, are recognized as trustworthy and reliable entities committed to constant, long-term adherence to top quality standards. Accreditation is considered an important point of reference when it comes to gauging organizational quality. Preparation for accreditation will accord healthcare organizations a chance to ascertain its existing strengths and any potential areas for improvement. The preparation phase helps offer valuable information to management, facilitating effective decision-making with regard to operations, for improving organizational performance in terms of its productivity and efficacy (Why get accredited, 2016).

Moreover, it helps distinguish a given healthcare organization from the remaining healthcare practitioners. An accredited hospital indicates management's and workforce's devotion to growing into the practitioner of choice, guaranteeing clients are delivered the best possible healthcare. It also ensures improved patient faith in the organization, and recognition. Accreditation aids in strengthening the community's confidence in the healthcare facility, and its service quality. Additionally, it serves to increase organizational value. Given the incessant modifications to the health sector, patients seek dependable professionals who constantly and unfailingly provide superior quality healthcare and validate their capacity of remaining adherent to national standards. Hence, through accreditation, a healthcare center can validate its capability of adapting to industrial modifications and increase organizational value (Why get accredited, 2016).

Standards within the health accreditation field refer to certain feasible, desirable performance levels, against which accrediting firms gauge real performance. Standards help small to large hospitals and other healthcare units incorporate efficient, reasonable client safety and quality enhancement programs into everyday operations. Clinical and external organizational accreditation benchmarks are deemed vital to promoting the dissemination of safe, dependable, and superior-quality health services and products (Greenfield et al., 2012). Hospital accreditation is deemed to be a valuable means of promoting accountability in healthcare delivery; a positive status has generally been employed as an organizational marketing instrument (Menachemi et al., 2008).

A discussion of the financial, time, and associated costs of earning and maintaining accreditation

One view regarding the issue is that substantial personnel time and efforts, and organizational funds, are devoted to accreditation; these precious organizational resources may be put to better use elsewhere (for instance, in pursuing clinical care and service programs). Accreditation-related costs are a greatly debated and discussed issue in health plans. Accreditation is one major investment, but healthcare organizations usually wonder whether all that commitment of energy, time, and funds creates tangible advantages. In as much, the most significant concern regarding to accreditation is the cost involved to earn one. Insurers impose double-digit growths in premium on organizations, intensifying the former's sensitivity to accreditation expenses (because these expenses were passed on). Costs may be vastly divergent for diverse accreditation programs, although compliance-linked expenses, and not site visit and application costs, often constitute the key difference (Cross, 2003).

All entities of the health sector are seeking budget cutbacks, owing to the escalation in care delivery expenses for healthcare organizations as well as their clients. Exorbitant sums of money have to be allocated to accreditation, a procedure that entails healthcare organizations pay to accrediting firm (consultancy services), the requisite software normally purchased from the accrediting firm, consultancy services normally delivered by the same accrediting firm, and human resource to handling the process. Overall, accreditation-linked costs to the U.S. health sector are prohibitively high (Curnayn, 2011). Numbers on true accreditation-linked expenses chiefly include dedicated workforce, manuals, review application, education/training with respect to accreditation standards, interim review conditions, review process, subsequent review by a federal- or state-level agency and findings resolution (Whitney, 2013)

Further, a large number of healthcare providers raise concerns with regard to accreditation initiatives' bureaucracy and time needed. Providers typically view such initiatives as costly, not adding much value to healthcare, variable based on assessor, and posing accreditation standard-linked issues (What are the impacts of health sector accreditation, 2010).

Much of the overall cost goes in the labor-intensive activity of preparation for earning accreditation, especially in the last few months leading up to an actual survey of the organization. Individual organizational expenses are high, raising the question of whether or not it is a wise decision to get accredited. A Zambian research on accreditation revealed that the process was linked to unsustainable financial viability and expenses, overall, for individual hospitals (What are the impacts of health sector accreditation, 2010).

A discussion of the costs of either not securing or losing accreditation

Accreditation is "optional"; however, without it, no healthcare organization in the U.S. can expect Medicare funding. Given the constantly-declining insurance firm reimbursements, a number of health centers cannot survive in the absence of Medicare reimbursements. Such dependency increases the price of the accreditation process. Without accreditation, health plans might be perceived as less lucrative by prospective purchasers, as large corporations particularly insist on an accredited plan. Prospective patients will ultimately seek care at the hospital covered by their insurance program; hospitals need patients for remaining functional, at the cost of unaccredited ones (Curnayn, 2011).

Although being accredited is a completely voluntary decision and isn't mandatory for participation in the Medicare program, voluntary refusal to be accredited would result in ultimate financial collapse for a healthcare organization, if they lose employees (patients) of large local businesses'. No manager would voluntarily choose to land in financial ruin (Curnayn, 2011).

A research-supported evaluation of whether accreditation is worth the costs

Despite accreditation's desirability among major stakeholders, and its face validity, the process is both time-consuming and costly. Hence, stakeholders' qualms and demands for evidence regarding accreditation's impacts on patient safety and care deliver quality are justifiable. In an ideal case, accreditation would improve performance at individual points in time as well as be linked to the speed with which the organization improves over time. An analysis for showing the link between service improvement and accreditation status in a 5-year performance trajectory was conducted.

Capitalizing on the accreditation process's significant transformation around the same time the Centers for Medicare & Medicaid Services (CMS) and Joint Commission (TJC) started mandating public reports of research-substantiated measures of quality, the aforementioned research discovered that TJC-accredited facilities depicted greater performance improvements between 2004 and 2008 as compared to non-accredited ones, despite the former beginning with greater reference-point levels of performance (Schmaltz et al. 2011).

Such a speedy improvement was broadly based; the 2008 estimate was that healthcare organizations with accreditation would likely attain superior performance (>90% compliance with quality measures) on 3 clinical field summary scores, all but three nation-wide standardized care quality measures, and a better overall score as compared to non-accredited healthcare organizations. The outcomes are in line with other researches into accreditation and outcome and process measures. According to collected data, accredited facilities averagely achieved better performance on evidence-based measures of quality, with more striking performance improvements as the years progressed (Schmaltz et al. 2011). A second research observed that critical access healthcare facilities with accreditation exhibited better performance on a fourth of Hospital Compare (HC) database quality markers as compared to unaccredited ones (Lutfiyya, Sikka, Mehta & Lipsky, 2009).

Kansas City's Blue Cross Blue Shield health insurance firm presents a rather simple argument when it comes to accreditation. According to a particular plan, the agency dedicated roughly two million dollars for securing dual accreditation: one from the Utilization Review Accreditation Commission (URAC) and the other from the National Committee for Quality Assurance (NCQA). The insurance firm's two Health Maintenance Organizations have total URAC-accreditation for their health plan and have been rated "excellent" by the latter accrediting firm. Without its accreditation investment, the insurance firm would be forced to relinquish sixty million dollars of business from the large automobile manufacturers that need it. This is a huge business segment for the insurer, which would not have been secured if not for its NCQA-accreditation (Cross, 2003). Further, processes established for fulfilling its accreditation standards facilitate the planning of a better firm. The insuring firm's customer service reports were depressing when, during the late nineties, it allowed a lapse in its accreditation, in the excitement of an information system renovation of forty million dollars. However, things improved when the company decided upon setting its affairs in order as well as getting itself dual-accredited. As of now, it has one among the top-ranked Blue Cross service plans. Hence, clearly, the overall (monetary and non-monetary) costs associated with not seeking accreditation are too high to ignore (Cross, 2003).

References

Cross, M. (2003). Money Pit: Is Accreditation Always Worth the Cost? Retrieved November 4, 2016, from http://www.managedcaremag.com/archives/2003/7/money-pit-accreditation-always-worth-cost

Curnayn, K. (2011). The Real Risk is Quality Care: The Cost of Accreditation. Retrieved November 4, 2016, from http://www.nursetogether.com/real-risk-quality-care-cost-accreditation

Greenfield, D., Pawsey, M., Hinchcliff, R., Moldovan, M., & Braithwaite, J. (2012). The standard of healthcare accreditation standards: a review of empirical research underpinning their development and impact. BMC health services research, 12(1), 1.

Jaafaripooyan, E., Agrizzi, D., & Akbari-Haghighi, F. (2011). Healthcare accreditation systems: further perspectives on performance measures. International Journal for Quality in Health Care, mzr063.

Lutfiyya, M. N., Sikka, A., Mehta, S., & Lipsky, M. S. (2009). Comparison of U.S. accredited and non-accredited rural critical access hospitals. International Journal for Quality in Health Care.

Menachemi, N., Chukmaitov, A., Brown, L. S., Saunders, C., & Brooks, R. G. (2008). Quality of care in accredited and nonaccredited ambulatory surgical centers. The joint commission journal on quality and Patient Safety,34(9), 546-551.

Schmaltz, S. P., Williams, S. C., Chassin, M. R., Loeb, J. M., & Wachter, R. M. (2011). Hospital performance trends on national quality measures and the association with Joint Commission accreditation. Journal of hospital medicine, 6(8), 454-461.

What are the impacts of health sector accreditation? (2010). Retrieved November 4, 2016, from http://www.supportsummaries.org/support-summaries/show/what-are-the-impacts-of-health-sector-accreditationa

Whitney, M. (2013). Considerations for selection of a hospital accreditation organization to secure deemed status 8/14/2013. Retrieved November 4, 2016, from http://www.qmcg.com/publicationdetail.aspx?publicationid=200

Why get accredited. (2016). Retrieved November 4, 2016, from http://www.achc.org/gettingstarted/why-get-accredited