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At ABCS RCM, we follow the news stories that discuss the rising cost of healthcare. A common argument in many of these stories is that medical providers need to focus on creating value for their patients. Creating “value” quickly rises the concepts of access, cost and quality; or what some have called the Iron Triangle of healthcare.

However, as one examines this recent trend, it is helpful to look at the core concepts and desired outcomes in health care and how they often compete with each other.

Politically, “the iron triangle” was first used to describe the connections that exist between the policy-making relationship among the congressional committees, the bureaucracy, and interest groups. However, in this case, the term is applied to the field of healthcare management.

The term “the Iron Triangle of Health Care” is largely credited to William Kissisk’s book Medicine’s Dilemmas: Infinite Needs Versus Finite Resources (1994). The book presents the concept of three competing attributes in the American healthcare system. These are three questions that health systems need to address:

Access – How easily can patents gain access to healthcare services?

Quality – What is the quality of healthcare that is delivered to patients?

Cost Containment – How expensive is it to deliver healthcare services?

Conceptually, each of these features resides at the corner of a theoretical “triangle” shape.

As one moves between these features of healthcare, the consequences of each attribute change, with one increasing while the other may decrease. For example, a policy that increases access to health services would likely lower the quality of healthcare or increase the overall cost.

In the Iron Triangle paradigm, the ideal situation is one where medical professionals provide high medical access and quality, but at the lowest possible cost.

The closer medical providers are at moving to this ideal, the closer they are to delivering or producing “value” in this health care model. This has produced, or at least greatly influenced, the increasingly common term known as value-based care. This sounds straight-forward, but as any economist will tell you – there is always an opportunity cost.

In the Iron Triangle of Health Care model, it is impossible to maximize all three features or characteristics.  Things are made even more complex due to the fact that cost can change very quickly, while new technologies may disrupt the existing model.

In the end, people are looking for the best possible outcome. There are many political and financial “interests” in the healthcare marketplace. Sometimes these interests work together and other times they directly conflict with one another.

It is true that there has been an increase in insurance deductibles and co-pays for many Americans. This debate surrounding medical expenses, access and quality will only intensify as more Americans age and become eligible for Medicare benefits and require health services.

About Us:

Advanced Billing & Consulting Services understands these potential conflicts and strives to provide up-to-date, relevant information to our clients. We understand that healthcare providers are going to operate successful practices, they must navigate the ever-changing landscape of the U.S. healthcare system.

We have been providing healthcare-related services since 1997. These services ranging from cardiology to substance use disorder programs. In addition, we offer workforce management tools for I-DD agencies, web design & digital marketing as well as credentialing services.

For questions about healthcare-focused revenue cycle management or for additional information about our services, call us at 614.890.9822 or email us.

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Creating Value in Health Care, Iron Triangle