Amid what may be healthcare’s toughest era, financial leadership currently faces the daunting task of increasing revenue while simultaneously containing costs. At the recent Becker’s Hospital Review 11th Annual Meeting, Jason Ross, senior vice president of revenue and network management for LifePoint Health — a nationwide health system with 87 hospitals in 29 states — discussed his organization’s experience with revenue cycle partnerships in a featured session.
Ross addressed topics such as LifePoint’s timing — beginning their R1 partnership during a pandemic — their goals and the advice all leadership should heed as they consider whether a revenue cycle partnership is right for their organization.
Here’s what he had to say:
1. We know that containing cost, increasing revenue and improving the patient experience are key challenges for most CFOs; are they what keeps you up at night?
Sure, but I’m grateful to say we don’t have poor operational performance across our revenue cycle. About two dozen of our 87 hospitals aren’t served by our centralized billing office, and these facilities do all their own revenue cycle work, from patient access to coding to billing and collections. These 24 hospitals do great revenue cycle work, but they’re not standardized or centralized aside from our central policies. We knew that cumulatively, these 24 hospitals most likely represented many inefficiencies and non-standard processes.
Our priority became identifying and eliminating any inefficiencies and achieving enterprise standardization. We knew this was the key to unlocking more value in our revenue cycle — this was the way we’d realize significant improvements in financial and clinical outcomes, as well as our patient experience.
2. So how did you go about unlocking more value in your revenue cycle?
We wanted to find the best way to continue the operational improvements we had already started, so our question became, “How can we make the most significant improvements and achieve the greatest overall outcomes with the least amount of investment in the shortest amount of time?” And that got us thinking about how we could standardize faster, scale faster and develop deep specialization and focus across the revenue cycle at each of our facilities. Once we identified that goal, we looked at every solution possible: insourcing, outsourcing, consultants, various types of partnerships. It became clear that a revenue cycle partnership was the best way to achieve our objective.
3. When you evaluated revenue cycle partners, what attributes were most important?
First — and I know a lot of our listeners would say the same — we love our culture and think it’s unique, so cultural alignment was very important. Our mission of making our communities healthier drives everything we do and guides virtually all material decisions. A partner might get great results, but if how they get them isn’t consistent with how we serve our communities, it won’t work.
A key part of our culture is process rigor. Our DNA is rooted in operating small, community-based facilities. I’d humbly submit that we do this as well as anyone in the country — and that’s due to our extremely disciplined operators in small communities who have an adherence to process like nobody I’ve ever seen. This cultural fabric permeates everything we do here in the corporate office, so we wouldn’t be comfortable with a partner that wasn’t equally committed to process rigor. Flexibility is important, too; you need to be able to tweak processes on a dime, but you need a detailed plan.
Second, our priority was speed to value: How quickly can we get this done in a methodical, process-oriented way? We weren’t going to forsake quality for speed, but anytime you start to tweak large chunks of the revenue cycle process, there’s a valid concern about a disruption to cash flow and overall operations. We needed to know our partner could help us get where we needed to go, quickly and efficiently.
4. To follow up, what was your vetting process for knowing a partner was a good fit — both from a process and results standpoint as well as culturally, knowing they’re doing it for the right reason?
I wish we’d had a form to fill out for that, but here’s what I’ll tell you: Our evaluation process entailed meetings with many companies across different parts of the revenue cycle. We spent a lot of time with R1, but others, too, and had detailed conversations getting to know people at the executive, director and manager, and operator levels. It’s like developing trust; it doesn’t happen quickly. I don’t know that you can have two or three meetings within a couple of weeks and know a partner is a cultural fit — or have a detailed, culturally aligned implementation plan that promises success.
5. So it’s really about an ongoing conversation and open dialogue as well as engagement with different partners?
At a fundamental level, it’s about asking potential partners, “Here’s the problem we want to solve; how exactly will you go about doing it?” In these conversations, the relationship development will happen. And it wasn’t just me having these discussions; it was LifePoint’s executive, financial and revenue cycle leadership. All of us were highly involved and able to evaluate whether each partner was capable, culturally aligned, committed to process and results driven.
6. You began your partnership in late 2020. Did the pandemic influence your decision-making process?
It created a greater sense of urgency. It’s easy to clutter your plate with non-essential work if you don’t stay focused on your most important objectives. In January 2020, hands down, improving financial performance throughout the revenue cycle was my team’s No. 1 priority. We shot out like a cannon working on this just as COVID-19 began to hit the news. We had to hit pause in mid-March but knew we’d resume our work when there was light at the end of the tunnel. That came in April with the CARES Act, but we still didn’t know what tomorrow was going to bring — so I’ll say if it’s something that financially impacts your business, you should act on it as quickly as possible.
7. Moving forward, can you talk about what you want to achieve through your R1 partnership?
Using the rule of three, I’ll start off with our short-term objective. A big migration process is currently underway; we have a lot of people to move and technology to implement. Besides making sure that’s successful, we want our revenue cycle KPIs to move in the right direction.
Second, a mid-term objective is making sure those KPIs flow through to improve LifePoint’s broader financial performance. Are we accelerating cash flow, decreasing costs, improving P&L and our balance sheet?
Third, our long-term objective is around innovation. So much is happening around the consumer and patient experience. Let’s be honest: Healthcare isn’t the most consumer-friendly industry, and consumer and patient needs are evolving quickly. This evaluation process really opened our eyes to the level of investment that successful healthcare systems need to make, both now and in the future, to compete and drive sustainable competitive advantage. We want to stay ahead of the curve and enhance the patient experience as much as possible.
8. As the partnership evolves, what key challenges will you address?
There are many, but I’ll mention two. The first is our growing portfolio of value-based care work, such as the Medicare plan development our CFOs are involved in or our increasingly robust bundled payment program across about half (of) our hospitals. The revenue cycle’s role in value-based care may not be as obvious to some, so here’s an example: Our ability to document and code appropriately for a Medicare bundled payment patient is absolutely critical to helping to accurately estimate what CMS will pay over a 90-day period, so HIM, coding operations and CDI are all critical. If you do them poorly, you won’t succeed in value-based care. R1’s strategy around value-based care and their investments in this area resonated with us.
The second is related to the patient experience. Again, we saw the technology investments R1 has made; we saw them in action at their client sites. R1 is acutely more aware of what a consumer needs and wants than we are; they’ve picked it up from other industry sectors and infused it into the healthcare-delivery system. I think all providers are seeing patient preferences such as digital self-service that initiated in other sectors. Besides that, LifePoint wants to remove both obvious and non-obvious barriers to care across the entire consumer and patient experience.
The LifePoint team knows who we are and what we’re good at. The part we’re not good at — innovating to create an exceptional patient experience — is where the market is going. We needed to find a way to accelerate our learning curve, but in addition, access consumer-facing technology that can give patients what they need, want and expect from healthcare now and in the future.
9. Any parting advice for your peers?
One thing I’d say is to try to be objective. Full disclosure, we had some senior leaders who really wanted to do all the work on our own. To our team’s credit, we ultimately understood that there were many things happening in the revenue cycle and the broader market, so it’d be a disservice to LifePoint if we didn’t really research every option. We had people firmly entrenched in a staunch view of what we should do and how we should do it; then by the end, they’d completely flipflopped and wanted to enter the R1 partnership.
I learned so much during this process — both what we found digging into our own operations and what’s out there in the market. It brought the team closer and unified the vision. Even though we landed in a place a lot of people didn’t expect, in the end people were incredibly on board. I think R1 would say they see a unified LifePoint team doing everything we can to roll in the same direction to make sure this partnership is a success. Lastly, as you start the process, check your ego. Seek out the truth and what’s best for your organization regardless of any preconceived notions — we all have them. If you let yourself do this, you’ll come to a much better answer.
Author Bio: Brian Zimmerman is the senior director of client content and strategy at Becker’s Healthcare.
