Part 2: Cost VS Experience: Rewiring the RCM Workforce for a Hybrid Reality

Welcome back to Part 2 of our conversation with Scott Cooper. In Part 1, we discussed the hybrid revenue cycle model and how organizations balance cost, quality, and patient experience. In this segment, we'll dive into assessing opportunities for improvement, implementation strategies, and how hospitals can address staffing challenges.

Transcript

SPEAKER_02 0:00

Welcome back to part two of our conversation with Scott Cooper. In part one, we discuss the hybrid revenue cycle model and how organizations balance cost, quality, and patient experience. In this segment, we'll dive into assessing opportunities for improvement, implementation strategies, and how hospitals can address staffing challenges. Yeah, I think that makes a ton of sense. Um, talking about that, you know, where does it make the most sense to do the work and how are we mapping out the way the work gets done? What elements go into assessing what's right for that client? And how does the client contribute to it? You you talked a little bit about the pre-contracting phase. Can you speak to that assessment piece a little bit more and what somebody would expect to as they go through that process? Like if I'm the hospital administrator calling you saying, hey, I'm interested in talking to you about how you create efficiency within my Rev cycle. I know my Rev cycle is expensive to operate. I know I have some deficiencies. Um, I've got really great quality scores, and my people are good with people, but I don't know where my gaps are. I you know, I know that my denials are high or that my AR has several days, but I don't really know where to best plug in. Like, how does that, how do you help me make a good decision for myself?

SPEAKER_01 1:38

Yeah, sure. Uh, and and and this is actually this is kind of agnostic of that onshore, offshore hybrid thing. This is just in in general. I think um one of the things that we do really well uh at ovation uh in partnership with with our leadership advisory group, um is we will we have people, we have consultants that will actually come in and spend time, you know, one week, two weeks, four weeks, really depends on the on the scope and scale. Um, but we'll spend time with the hospital, with the Rev Cycle leaders, with the CFO. They'll spend time combing through the data. And effectively what we'll do in advance of of you know, trying to solve working through services is we'll go say, here are your three or four biggest opportunities, here's what we think they're worth, here's how we think we can help. Um, and the the here's how we can help conversation, that then skews towards the do we want the onshore, do we want the hybrid? What does that look like? But one of the things that I think we've been we've done really well, uh, really well with, and one of the things that I think our clients are are most happy with is that assessment up front. Um, and that assessment up front allows us to go in and say, here are your biggest area of opportunities, here are your real pain points, not just what the data is telling you, but really from the ground, you know, from the ground up. Um let us help you. And then what's really cool, and we saw this with with one of our clients that uh went live in Q1 this year, is that assessment then becomes a playbook for how we help post uh taking over services. So, hey, we're gonna figure this out, we're gonna spend three, four weeks, we're gonna tell you what the issue is. Let us do your billing and your AR, let us do your denials, let us do your coding, whatever that may be. Um, and oh, by the way, here's that consulting report that becomes the playbook for how we're going to improve your services, not just do the work. Here's all the things we said was broken, here are the things we're doing to fix it. And then over time you see those tangible results, and we can track that. You know, we've got our monthly, you know, our monthly operating reviews with our clients. And it's, hey, here was the project plan, here was the things we said, here's what's happening, here's what's in flight, here's what's closed, here's the value, et cetera, et cetera. So it's kind of a really kind of nice thing we do.

SPEAKER_02 3:53

I've recently talked to several hospitals um that they're experiencing turnover of seasoned staff who have been there years and years, and they look to replace the staff and can't find the right skill mix, especially in these small rural communities. Um is that an opportunity to look for um like this this hybrid model or ways that somebody like you can sort of fill in these gaps?

SPEAKER_01 4:26

Yeah, I think yeah, it's it's interesting. If you think about uh like post-COVID world, um it was great in that it created this we can go remote environment. It kind of like it forced everybody to rethink how they do work and where they do work. Um and it's great because now you've got a whole bunch of folks across the country that can come in and dial in remote and do your work, and you've got the tracking and the technology that we kind of talked about earlier, and so you're able to do that remote. Um, but there was this other weird side to that, in that it kind of created this like labor arms race. Uh, in that, okay, well, I had 15 people in my small community doing Rev Cycle, but now they can do it remote, and people don't necessarily want to be in the office anymore. So maybe we'll let them do it remote. And oh, well, guess what? Now my little hospital in you know, Wyoming or Idaho or wherever is now competing for talent with a hospital in New York City that may pay them twice as much. Because the hospital in New York City is now going to let them do remote rev cycle work and you know, they've got much higher spend thresholds and they're able to pay more. And so like a lot of your talent is now migrating out. So it's weird. It's like this dual effect of now you can go hire everybody anywhere, but now because of that, you're competing with the hospital in New York City, or in some cases, like you may be competing with the retail store in the community, right? Like it's just it's just it's gotten weird from a labor perspective. And I do think I do think it is hard and especially hard for our specific clients in our demographic um to find good recycle talent in their communities. Um, and I do think um one of the reasons that we have been successful is because that has been a challenge, and a lot of hospitals have kind of just thrown their hands up in the air and said, I need to focus on patient care. I need to focus on my hospital being healthy and the community being hot uh healthy. And not only do I not have the resources, I don't have the time, like I just don't want to have to manage this process. And that's what we do. Like we manage the process, we have the tech, we have the tools, we have the management, we have the performance management. Um, and I think that's why a lot of people come to look for us is they say, hey, like, A, I can't find people, B, if I can find people, maybe not necessarily gonna perform up to snuff, can you help me? Like you guys are the experts, and it is this kind of like this economic idea of specialization, and we are the specialization in this space. So I don't know that I answer that.

SPEAKER_02 7:05

Yeah, you you did actually. I really appreciate the soapbox because it's an interesting perspective because I hadn't really thought about that, I guess, from the employee side. You hear as an administrator, you know, you're involved in the community, you're on the economic development board, you're talking about like how do we maintain jobs in our community? And so there's also this pressure from um your local community and pressure you put on yourself as like the employer, right? Like you a lot of times are the place where people look to for you know good paying jobs within your community. And what some of these decisions are really hard. They're emotional, they're connected back to like your your broader purpose, not just to provide healthcare, but to provide like the economic sustainability. And so you think about, well, if we, you know, what does this mean if we reduce five jobs within our community? But those people, you know, as you were saying, may already be working elsewhere, still staying in your community because of the dynamics that have shifted so much. So how have you worked through those perceptions, those emotional decisions that go into that? Like, I know I have an obligation as an administrator to make decisions that are in the best interest of my hospital. That includes financial decisions and making like tough choices to reduce staff or cut services when it's necessary. But how how have you worked through that and helped people become comfortable with this type of model?

SPEAKER_01 8:45

Uh this type of model, meaning like the hybrid, the hybrid model. Yeah. Um, I think first, if you're a hospital administrator, you ideally have a fiduciary duty to the hospital to remain healthy and keep that community healthy. And I do think that that often requires very difficult decisions. Uh, and I do think that's unfortunate. Um, and I think we would like to think that uh healthcare uh is not a business. I'm gonna get fried for this. Um but it is, right? If you're if if if if you cannot be profitable in some capacity, and you don't need to be profitable, if you cannot break even, maybe is a better way to think about it. Um you're just not gonna be financially solvent and it's uh over time. And and that's the kind of I think one of the ugly truths that we're seeing, especially in our market with the with the smaller kind of independent community rural hospitals. Um and so you you're kind of being forced into those tough decisions for the greater good of the hospital, as you as you note. Um I would like to think, I do think, uh, that our you know, our hybrid offering uh helps to make some of those decisions a little bit easier. Uh if we are if we are able to provide Rev Cycle services at a lower cost point at the same quality or better, um, and quality and you know, meaning not just quality, but also arguably kind of yield and revenue improvements. Um that's money you can reinvest in the hospital. All right. And it doesn't necessarily mean reinvest in rev cycle, but if I'm able to say, you know, I'm I'm gonna make these numbers up. If you're a hundred million dollar hospital and I'm able to save you a million dollars in rev cycle cost or a million dollars of cost and improvement, that's a million dollars you arguably didn't have before. Uh, you can then reinvest that in the hospital, you can reinvest that in patient care, you can reinvest that in maybe other departments where you're thinking about those hard decisions you may have to make um from a people perspective. And maybe that prolongs or puts off that decision. Um so again, I think I I think we have a model um that works and we believe it works, we know it works, um, and we're able to we're able to provide that service at uh at the same or better at a at a lower cost point. And I do think I do think that that I do think that the financial relief, so to speak, that that can bring to a hospital um is meaningful. I think it's meaningful. Um, and I think that's why what we're seeing is a lot of our a lot of our our partners and our clients at this point, uh that's that's what they opt for. They, you know, they're they're struggling, they need the dollars regardless of how it comes, and they want to make sure that they can remain healthy, and that's one of the ways they're doing it.

SPEAKER_02 11:50

So thanks. So when you say you you know it works um and you measure the quality, what does that look like? How are you measuring the quality? How are you continually assessing the performance so that that you're on track to deliver what you said you could do?

SPEAKER_01 12:12

Yeah, I think um, you know, if you think about quality from like a micro perspective, quality is like, did you do the right thing? Did you touch the right claim? Did you, did you make the phone call? Did you put in the note? Like there's some very, very specific activities that need to happen from a quality perspective, um, as we measure it from a quality perspective, but that's more of a like the operator level. I think if you're sitting at the if you're sitting at like the CFO level, um quality to me, it's gonna be a really weird view of quality. Um, quality to me, uh aside from the like the compliance things, um quality and and and answering the question, did I make the right decision to do this? comes down to financial performance. So if I am a $100 million net revenue hospital and I'm collecting $96 million a year in collections, next year when I switch to this hybrid model, am I still collecting 96? Am I collecting 97? Am I collecting 98, or am I worse off? Right? Ultimately that it's it's weird, but that's like the financial view, I think, of quality is did I make the right decision for the hospital from a financial perspective? And the right decision to me, uh with that lens is am I collecting, is my collection rate, my net collection rate or my gross collection rate, is it on par or better than it was before? And if there's no degradation in that, like if you're not seeing that fall as a result of this hybrid model, to me, that is success. And I think that's that's what we've seen is you know, we've employed this hybrid model with a ton of our clients, and we're still seeing that those gross collection rates, again, from the CFO financial mindset, continue to grow and outperform when normalized for everything. So to me, that is that is quality of whether or not this model works.

SPEAKER_02 14:15

That's all for this segment of our discussion with Scott Cooper. In the next episode, we'll explore staffing challenges, quality measurement, and determining how a hybrid revenue cycle approach is right for your organization. Be sure to follow Vatian Healthcare on LinkedIn and subscribe so you don't miss part three.