hometown 2011 fall meeting

Jimmy Lewis CEO, HomeTown Health, LLC , 10-21-2011

HomeTown 2011 Fall MeetingLEARNING OUTCOMES OF PRESENTATION:

1. Describe the findings of the 4 policy maker field trips that included 28 hospital facilities.

2. Out of the 28 hospitals visited during the policy maker field trips, identify the best practices among them.

3. Discuss the upcoming legislative session.


HomeTown 2011 Fall Meeting

Premise of HomeTown Health Findings1. 27 Hospital visits May 2011-October 20112. Six Hospital Board Interventions Oct-Nov 20113. About 50 webinars 20114. Input from 5000 HTHU enrollees



What 10 years will do!1) Cost to Charge Ratio fall has created major

damage to CAH’s2) PPS at 85.6% of cost has done irreversible

damageThey got the message!


HomeTown 2011 Fall MeetingTypical CAH

Typical CAH Hospital Actual Data

Payor % cost reimbursement % Net Revenue by PayorWeighted Reimbursement by Payor

Medicare 95.000% 55% 52.250% Medicaid 95.000% 12% 11.400% No Pay 2.000% 12% 0.240%Commercial 150.000% 21% 31.500%

Profitability 100% 95.390%

Hospital Name Net Revenue Cost Profit $12,000,000.00 $12,579,935.00 -$579,935.00


HomeTown 2011 Fall MeetingTypical PPS Actual DataPPS Hospital Cash Flow

Payor % cost reimbursement % Net Revenue by PayorWeighted Reimbursement by Payor

Medicare 93.000% 55% 51.150% Medicaid 85.600% 15% 12.840% No Pay 2.000% 10% 0.200%Commercial 150.000% 20% 30.000% To Break even 100% 94.190%

Commercial - equals commercial cross subsidization

Net Revenue Cost Profit$22,000,000.00 $23,357,044.27 -$1,357,044.27


HomeTown 2011 Fall MeetingWe Learned Current State of Rural Hospital Affairs

a. Cash flow first half 2012 awfula. Add-onsb. DSH only half distributedc. Unsettled cost reports – several hundredd. Outlierse. Qualified Medicare Beneficiaries

b. 17 hospitals in “Transition”c. DSH only half distributedd. CEO Turnover and Turmoil



Findings - Cons1. Overall Financial Crisis Among Rural Hospitals

A/R less than 5 days for many hospitals Minimum cash reserves

Payables over acceptable days



Findings Cons2. Lack of readiness for EHR in many cases

Have not filed with stateWho is Terri Brannigan?

The closest thing to the silver bullet!



Findings Cons3. C-suite Denial of severity of problems

Slow to reduce FTE’s or fix physician contracts



Findings Cons4. Poor Physician contracts - no RVU

Compensation Models or Performance Basis Contracts



Findings Cons5. Hospitalists programs being forced on

Hospitals



Findings Cons6. CMO Denials have wiped out cash



Findings Cons6. Failure to believe the following

a. $103,000 Net Revenue/FTEb. 43% salaries for net revenuec. Bad Debt at 8-10%d. Net A/R less than 50 dayse. 33%-35% commercialf. 40,000 population required to support a hospitalg. Baby Deliveries must exceed 350 AnnuallyOtherwise translates into necessary subsidy from DSH,

UPL or County



Findings Pros1. Excellent best practices identified

1. Examples 2. MSO’s3. Quadax4. Health Trust5. nTelagent6. RVU Doc Contracts



Findings Pros2. Incredibly creative and hardworking leadership

a. Vent patients at Millerb. Geriatric Psych Berrienc. Certifying HTHU studentsd. Figuring out how make payroll



Findings Pros3. Exceptionally active and informed community

leadershipMiller – in the rainElbert – political

Morgan – community and politicians



Findings Pros4. Great communication with State Alec Steele and his team

a. Earl Whitely – Calhounb. Robin Rau - Millerb. Kim Savage - Charlton



Findings Pros5. Great Political Involvement

Rep Mickey ChannellRep Butch ParrishSenator Jack Hill

Speaker David Ralston



Findings Pros

5. Great Patient Care

However getting buried in bureaucracy



Findings Pros

6. EHR – Financial AttestationCalhounSunLink



Legislative Forecast1. Budget – may be $250 million short2. State Health Benefit Plan $800 million

problem3. Redistricting impact4. Provider Tax5. Senate Power Structure



Legislative Forecast1. Budget – may be $250 million

short2. State Health Benefit Plan $800

million problem3. Redistricting impact4. Provider Tax5. Senate Power Structure



Congressional ForecastSuper committee proposals could shut rural

hospitals ...Wichita Business Journal - 1 day ago

The congressional supercommittee charged with finding ways to reduce the federal deficit is

reviewing several proposals that would target "critical access ...

1. It’s their attitude that is troubling!

http://www.google.com/url?sa=t&rct=j&q=&esrc=s&frm=1&source=newssearch&cd=4&ved=0CD0QqQIwAw&url=http://www.bizjournals.com/wichita/morning_call/2011/11/supercommittee-proposals-could-shut.html&ei=poPETomgPKfb0QHFpbmCDw&usg=AFQjCNERRCbl_nVIYxcQE15_1FilBus62w&sig2=pmyhrTvfWDVfnQHlYWRqiw






HomeTown 2011 Fall MeetingCash Flow Forecast

1. HIPAA 5010 Jan 1, 20122. State Health Benefit Plan $800 million

problem3. ICD10 October 20134. Four cash flow items – early 2012

1. Add-ons2. Outliers3. Unsettled cost reports

5. Qualified Medicare Beneficiaries6. DSH – HS&R’s

7. alified Medicare Beneficiaries


HomeTown 2011 Fall MeetingBest Practices Observed on Trips

1. MSO’s2. Quadax3. nTelagent4. Health Trust Purchasing5. Telemedicine – Blue Tooth6. DSH – HS&R’s7. EHR Plan for attestation8. CMO Appeal process9. Business Partner adoption



THERE IS NO SINGLE SILVER BULLET OF RELIEF So .. what is the answer? Bundles of little Silver bullets!

1) Absolute control of Revenue Cycle2) Trend is employment of Docs with RVU contracts3) CAH’s MUST manage variance while squeezing dollars4) Consolidation and elimination of duplicative services5) Adoption of known Best Practices6) Develop leadership at local level7) Go to a new level of board and political education


HomeTown 2011 Fall MeetingLEARNING OUTCOMES OF PRESENTATION:

1. Describe the findings of the 4 policy maker field trips that included 28 hospital facilities.

2. Out of the 28 hospitals visited during the policy maker field trips, identify the best practices among them.

3. Discuss the upcoming legislative session.

hometown 2011 fall meeting

Documents

fall meetingjimmy lewis

hospitals jimmy lewis

cash jimmy lewis ceo

turmoil jimmy lewis

fall meetingfindings

fall meetingwe

ratio fall

fall meetingwhat