From the President

Clarke_web

Richard L. Clarke, DHA, FHFMA

Performance improvement is in the DNA of healthcare financial managers.

By training and disposition, we measure performance over time, analyze causes of variations from goals and standards, change processes as a result of this analysis, measure performance change, and repeat this cycle. For many years, we have applied this core competency to the revenue cycle. And the results have been good. Hospitals communicate more effectively with patients about financial responsibility. They collect information from patients and insurers more comprehensively and earlier in the care process. They produce bills that are more patient-friendly. And they manage receivables in a more efficient fashion. Many hospitals have seen improvement in key performance indicators from net days in accounts receivable to cost to collect.

Unfortunately, much work is left to be done. The economic downturn and declining payment from government and commercial payers challenge hospital margins and make it imperative to collect all revenue that is due-and to do so as efficiently as possible. We got another reminder of these challenges recently, when the Centers for Medicare & Medicaid Services announced a 0.4 percent net reduction in inpatient hospital rates for federal FY11, which Moody's characterized as "an unambiguous credit negative for not-for-profit hospitals and a key driver to our maintaining a negative outlook for the industry."

In addition to external challenges, the revenue cycle has presented difficulties when it comes to performance improvement. There has been no agreed upon set of metrics, and even common metrics are defined differently by different organizations. There have been no reliable peer comparisons to help organizations set appropriate performance goals. And although much instruction exists about what practices constitute a high-performing revenue cycle, there has been no set of practices tied directly to measurable high performance that hospitals can use to guide their improvement efforts.

HFMA has taken a major step toward supporting your revenue cycle performance improvement efforts with our new MAP initiative for revenue cycle excellence. MAP stands for measure, apply, and perform, and the initiative consists of the following:

  • MAP Keys, which define the essentials of revenue cycle performance in clear, unbiased terms and set the standards for the healthcare industry
  • The MAP App, a customized web-based tool for tracking performance, comparing your performance with peer groups, and recommending improvements based on successful practices of other organizations-due to roll out within the next several months
  • The MAP Award, which honors hospitals that achieve revenue cycle excellence, based on the MAP Keys (A special section in this issue of hfm highlights a few of these hospitals.)
  • The MAP Event, occurring Nov. 7-9 in San Diego, which delivers the best strategies and tools from MAP Award-winning hospitals in a hands-on, interactive setting

With the tools that HFMA's MAP provides, healthcare finance leaders can apply their innate performance improvement skills and achieve unparalled revenue cycle excellence. I invite you to become part of this important initiative.

Publication Date: Wednesday, September 01, 2010

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