When HMO practices think about wound care, they usually think about costs. The expense of referrals, the drain on capitation pools, the administrative headaches. But what if wound care could be a revenue driver instead of a cost center?
That's exactly what happens when practices bring wound care in-house. Here are five concrete ways an in-house wound care program can boost your bottom line.
1
Eliminate Referral Leakage
This is the most obvious — and often the largest — source of savings. Every wound you manage in-house instead of referring out saves your practice $3,000-5,000 or more per patient.
The Math
- Average wound referral cost: $4,200
- Average wounds referred per year (mid-size practice): 50
- Wounds manageable in-house with proper training: 35 (70%)
- Annual savings: $147,000
This isn't revenue generated — it's revenue you're currently losing that you get to keep. For capitated practices, that's real money that stays in your pool.
💰 Potential Impact: $75,000 - $200,000/year2
Capture Quality Bonuses
Wound care directly impacts several quality measures that affect your bonus potential:
HEDIS Measures Affected
- Comprehensive Diabetes Care: Proper diabetic foot ulcer management improves your diabetes care scores
- All-Cause Readmission: Preventing wound complications reduces 30-day readmissions
- Patient Experience (CAHPS): Convenient in-house care improves satisfaction scores
Many Florida HMO contracts offer quality bonuses worth $20,000-100,000+ annually. Improving wound care can push you over thresholds that unlock these bonuses.
Example
A practice improved their Comprehensive Diabetes Care score from the 60th to 75th percentile partly through better diabetic foot ulcer management. This unlocked a $35,000 quality bonus they weren't previously receiving.
💰 Potential Impact: $15,000 - $50,000/year3
Improve MLR and Contract Position
Your Medical Loss Ratio (MLR) directly affects your relationship with payers and your leverage in contract negotiations.
How Wound Care Affects MLR
- External wound referrals increase your medical costs
- Higher costs = higher MLR
- High MLR = weaker negotiating position
- Weaker position = worse contract terms
By reducing wound care costs 70-80%, you can meaningfully improve your MLR. A 2-3% MLR improvement can mean significantly better contract terms at renewal.
Long-Term Value
Better contracts compound over time. A 5% improvement in capitation rates adds up to hundreds of thousands of dollars over a 3-5 year contract period.
💰 Potential Impact: Better contract terms worth $50,000+/year4
Reduce Patient Leakage
When patients go elsewhere for wound care, they often don't come back — at least not exclusively. Care fragmentation leads to patient leakage.
How Referrals Cause Leakage
- Wound center manages other conditions while patient is there
- Wound center refers to other specialists in their health system
- Patient sees you less frequently, weakening the relationship
- Patient may switch PCPs or disenroll entirely
Patient Lifetime Value
The lifetime value of a Medicare Advantage patient to your practice is $20,000-50,000. Losing even 2-3 patients annually to care fragmentation costs real money.
In-house wound care keeps patients in your practice, maintains the relationship, and reduces disenrollment risk.
💰 Potential Impact: Retention of $40,000 - $150,000 in patient LTV5
Create a Competitive Advantage
In-house wound care capability differentiates your practice from competitors who still refer everything out.
Marketing Value
- Attract referrals from practices without wound care capability
- Appeal to patients who want comprehensive, convenient care
- Position as a full-service medical home
- Win contracts that require comprehensive wound care
Reputation Building
Successful wound healing creates grateful patients who become advocates. Word-of-mouth referrals from satisfied wound patients bring in new patients across all your service lines.
💰 Potential Impact: New patient acquisition worth $20,000 - $75,000/yearTotal Revenue Impact
Adding up all five strategies, an in-house wound care program can potentially add:
Annual Revenue Impact Summary
- Referral leakage elimination: $75,000 - $200,000
- Quality bonus capture: $15,000 - $50,000
- MLR/contract improvement: $50,000+
- Patient retention: $40,000 - $150,000 (LTV)
- Competitive advantage: $20,000 - $75,000
Total Potential Impact: $200,000 - $525,000+
Even taking a conservative view, most practices see $100,000-200,000 in annual benefit from an in-house wound care program.
Getting Started
Building an in-house wound care program requires an upfront investment in training, protocols, and systems. But with potential returns of $100,000-500,000 annually, the ROI is compelling.
Here's how to begin:
- Calculate your specific opportunity using our ROI calculator
- Schedule a free consultation to discuss your practice's situation
- Request a program proposal tailored to your goals and resources
Ready to Boost Your Revenue?
See how much your practice could earn with in-house wound care.
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