hospital cfo's

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I write a lot of articles about the revenue cycle in hospitals. In some of them, it looks like I’m picking on chief financial officers. True, I’m the guy who wrote an article telling CFO’s that I don’t want their job. I also wrote an article discussing why hospital CFO’s don’t hire consultants like me more often. I’m also the guy who wrote a short article specifically for them with 10 tips to help them with their revenue numbers.

Stories; I have stories to tell. I’ll tell them quickly, short and to the point, so I can get on with what I really want to talk about.

At one job, after a pretty good 2-year period in which we lowered outstanding receivables by 35%, increased cash by 30%, increased revenue by 40% and finally got the computer system working properly, the CFO came in one day to tell me he was letting me go because I was in over my head. He was gone six months later, along with the head of HR and the CEO because it turned out they not only didn’t understand their own reports, but they’d told the auditors I was responsible for a department that never made any profit, even though I was the one who told them it wasn’t going to work.

At another job, I had to explain to my CFO every 3 months either why receivables were up or down as well as why cash was up or down. He could never understand that because of apple picking season and our being a small hospital, some months we had more patients than others and it fluctuated every 3 months.

At my first gig as an independent consultant, I told a CFO that her hospital was billing for services using a code that didn’t match what they had. She started saying she knew what she was doing because she’d been able to lower her hospital’s receivables in only 3 months. When I asked her a few times how she’d done it, she eventually admitted that she’d written off $3 million in old receivables that insurance wouldn’t pay.

At my next gig as a consultant, I had a CFO ask me why it took m3 3 months to figure out that a certain hospital department had 20 charges that didn’t have any prices. I had to explain to him that the 2-hospital system hadn’t had a charge master person in 3 years, had an audit 2 years before I got there and never addressed any of the issues the audit provided, and because they wouldn’t let me work extra hours it took time for me to get to the department… which, along with other things I discovered increased their average yearly revenue by $40 million.

At my next gig, I dealt with a VP of Finance who wanted me to change codes in a department that weren’t for that department because he said he knew what they would pay and he wanted to capture the funds for it. When I informed him it was illegal, he wanted to do it anyway, but eventually changed his mind when I handed him a letter to sign absolving me of all responsibility because I told him it was fraudulent.

At my next gig, I dealt with a CFO who once spent 3 hours with me, a billing supervisor, and the hospital CEO trying to convince us that some of the things he was trying to do to bring money into the hospital weren’t “exactly” fraudulent, even though they absolutely were. The facility closed as a hospital a year after I left and became a nursing home.

At another gig, the VP of Finance went on a 45-minute rant one day because the month previous I’d told him there was a problem with one of his departments and he didn’t want to hear it, then when I told him about it again the next month, with even more confirming data than I’d had the month before, said that the problem wasn’t his but everyone else’s because no one ever gave him numbers… which I’d given him two months in a row.

revenue cycle consultant
I can help

I understand what the problem is; I get it. The overwhelming number of CFOs I’ve met don’t really understand receivables. It’s not their job to understand it; it would help, but it’s not necessary. They don’t have the background for it. They’ve never sent out a bill, registered a patient, created a charge, coded a procedure or coded a medical record.

They often don’t realize that they might not have anyone who reports to them who understands it either. I’ve met very few directors of patient accounting who understand the revenue process or all that much about procedure or diagnosis codes. They’re great at billing processes and procedures, but the revenue cycle is much bigger than that. If most CFOs asked them how much “blank” is, most of them wouldn’t even know where to go to find out. If they decided to ask someone in a particular department what the price of something is, often the person they ask won’t know it either.

I’ve been in health care since 1983. I learned things from some pretty smart people, and then I learned more than they knew from other smart people. As a consultant, I’ve helped hospitals increase revenue by billions of dollars; one hospital by $730 million in one calendar year. I’ve helped hospitals increase cash, shore up charge capture and billing processes, learn how to better read remittances and how to call insurance companies to get proper answers.

Yet, the thing I struggle with most is to get a CFO to talk to me. Heck, I can’t get any of them to answer a phone or an email, or return a message left on voicemail, even hospitals that are in distress. I’m not alone in this regard; people in many industries hate the idea of reaching out to someone else who might have answers they don’t have. People like me don’t come cheap, and we shouldn’t be expected to.

How about some interesting numbers? Per Becker Hospital Review from 2015:

* Healthcare companies hired significantly more outsiders as their CFOs (57 percent of CFOs) compared with companies across all other industries (49 percent of CFOs).
* Almost half of CFOs, COOs, and CIOs are fired within nine months of a new CEO being hired.
* Health care CFO turnover was the highest of any sector of business within 5 years

Here’s my reality. I love the health care industry. I know the importance of hospitals. As both a full time employee and as a consultant, I want everyone to look good; I want everyone to succeed. I’ve been doing this for almost 36 years. I’m not getting younger. I figure I realistically have 6 or 7 more years to help any and everyone who wants their processes to improve, their revenue to grow honestly, to help their leaders be better, to bring in more cash, and to teach as many people as much as they need to know.

I want to work with as many people as possible; I don’t even need to leave the house all that often to do it. Call me; write me; read my articles. Let’s work together. Let’s make health care strong and lasting. At some point, all of us are going to end up in one; let’s make sure they’re doing as good as possible.
 

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