How Healthcare ARM Companies Can Take Advantage of Regional Economic Data

The healthcare industry is one of the largest market segments; many government officials talk about its impact in such all-encompassing terms that most citizens only consider it on a national level. Looking at broad economic data can have its benefits for politicians, think-tanks, and national health insurers. However, there are limitations for ARM and RCM companies.

Kaulkin Ginsberg recommends ARM companies focused on the healthcare vertical take a regional approach to their analyses. Most healthcare providers are strongly linked to the communities they serve, and the state-level unemployment rate is one of the best indicators of whether individuals in a certain region are likely to have health insurance. Studying this data allows you to examine the local labor force, providing insight into the types of consumers you’ll be working with and their propensity to pay.

By comparing the unemployment rates of Missouri, Nevada, and Maine against the national unemployment rate, we see that they all follow a similar trend. However, Missouri’s unemployment rate is slightly higher than the national average, and Maine’s is slightly lower. As for Nevada, a state built on consumption and tourism, we see a substantially higher unemployment rate compared to the national average. States and cities with significantly higher levels of unemployment necessitate a different strategy for collection operations, given the correlation between employment status and insurance.

Taking this example one step further, the chart above depicts the unemployment rate for several counties in Missouri. Once again, we see variation, and this time between areas of a single state. Dunklin County is at one extreme with a current unemployment rate of 8.8%, and Platte County is at the other with 4.6%. That’s nearly half that of Dunklin County and 1.1% less than the state average.

Nearly all of the data provided on the national level can be obtained on a regional level. If it’s not accessible, it generally holds true at all levels (i.e. interest rates are the same in any region).

We are happy to work with you to discuss the impact different economic variables will have on your operation, or explore advanced financial modeling and projection projects. To schedule a confidential discussion of your business needs, please contact us at hq@kaulkin.com. For more information about the healthcare industry or for access to our exclusive KG Prime archives, please contact Danielle Dredger at ddredger@kaulkin.com.