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Unintended Consequences of Keeping All CHC Jobs “Local”

October 21, 2013

CHCs exist to provideservice to the local community. That’s not news. It’s a simple fact. This obviously includes not just providing healthcare, outreach, and other manner of support but also employment opportunities for those living in and around the health center offices. However, a zealot like focus on this latter objective…keeping all jobs local… can result in some very unintended consequences.

Too often probable CHC partners, who admit they lack the knowledge, resources, and staffing expertise to successfully optimize the revenue cycle process… still choose to keep their billing “in-house.”  Quite often they cite the aforementioned objective of “hiring from the community” or “promoting from within.”  Often they do so to their own detriment and fiscal peril never mind without fully grasping how much more opportunity they could provide for their patients and local community members if their revenue cycle (CASH FLOW) were operating at full tilt.

With newly engaged CHC partners, PMG’s expertise has resulted in dramatic payment increases… as much as 44%.  So the classic response from naysaysers… “Well this is because the CHC grew or their visit volume expanded or they hired another few doctors.”  In fact, this increase occurs despite a //zero// flat rate of growth.  To normalize these data and avoid aberration due to growth, PMG uses per visit payment… what we call the lended Encounter Rate.  This number is calculated by dividing “unique patients seen” by “total payments received” with both figures being derived over a fixed period… a minimum of 3-6 months.  What we find is almost all CHCs experience a per visit increase (Blended Encounter Rate increase) of 25-30% within six months of hiring PMG to take over the entirety of the revenue cycle process.  This is neither magical nor mysterious but simply the outgrowth of PMG working exclusively… all day, every day… on becoming the absolute best at revenue cycle management within the CHC community. Even with the best of intentions… a CHC’s mission statement and focus will NEVER mention, never mind achieve, being THE best CHC cycle management group in the world.

Soooo… what would your CHC do if, without ANY growth (i.e., 0% increase in provider productivity, and no new grant support) your CHC found 25-30% MORE MONEY? What would you do? How would you spend?  How does this help your CHC expand their reach and community support??

With more money coming in the doors a CHC can expand clinic operations in terms of new staff, new programs, new clinics, new mobile units, new diagnostics, new specialties, etc. ALL of these programs need local persons to fill necessary positions. New clinic locations (via build renovation or ground up construction) help the local economy immensely by supporting local workers and small businesses. Also, don’t forget how great it feels to see a community uplifted by job and business expansion. With the recent blight of economic hardships over the past decade, it is easy to forget.

But the crux of the matter remains…  what to do with the “displaced staff” who lose their job if a CHC hires folks far more qualified to manage the CHC revenue cycle. First and foremost, if a biller is truly worth their salt… regardless of the economic conditions, s/he will find work.  Many healthcare entities are expanding and in need of quality billing professionals.  As a result, an unemployed biller with real skills is a sought after commodity. Second, many CHCs move former billing team members to the front desk or a similar position. Want to watch demographic, insurance, and eligibility errors diminish?? Let a former biller do the work as s/he knows the back-end issues resulting from substandard front-end processes. Third, former billing staff make great financial counselors and assure compliance with Payer of Last Resort, coordination of benefit issues, Medicaid/Medicare eligibility, and payment plans that work. Fourth, all sites need an “on-site” liaison with the new revenue cycle partner. Having someone who understands coding, CHC billing lingo, and the logistics/office-politics is immensely helpful to a new partner who does not reside at your office 24/7. Finally, in the least desirable circumstance, staff are simply released. BUT, if they are truly great staff, the opportunity to be rehired always exists.

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