Revenue cycle strategy helps a rural hospital regain its financial footing

This article was lightly edited for clarity.

When Joel Jackson took the helm of Three Rivers Health in April 2023, the 10-bed critical access hospital had fewer than 10 days of cash on hand. But in 15 months, Jackson led the team in recovering $2.6 million in accounts receivable (A/R) by addressing a backlog of claims.

Meanwhile, the hospital’s revenue grew 28% in two fiscal years to $18.1 million from $14.1 million. By May 2025, Three Rivers recorded 111 days cash on hand.

Jackson shared with RevCycleEdge the key steps in the rural hospital’s fiscal transformation, with an emphasis on adopting a more strategic approach to revenue cycle management (RCM).

RCE: In a situation like this, how did you go about diagnosing where the problems were and what to do next, especially for a facility of this size?

Jackson: The first thing you have to do is listen and assess where the staff are and whether you have the ability to get people moving together in the same direction. This gets staff and the board focused on the future and out of the immediacy.

If you knew you had no money, I’m pretty sure you would be thinking about that all the time. The key was to get staff and the board focused on things that are in the future that they could control and then to slowly put in place changes that would allow us to catch up on cash and improve operations. We’re doing all those things concurrently.

RCE: How difficult was it to make that culture shift, where the team is looking to the future?

Jackson: It was not hard. There may have been times that were scary or where I was concerned about whether we’d be able to meet an obligation, but I never for a second thought we wouldn’t be able to evolve the staff to where we need to be.

One of the things our leadership team talks about a lot is, ‘We are not the same as we were a year ago.’ My goal is to make sure everyone understands that they have skills that are valued and what those skills are. That’s how I approach my team intentionally with every interaction.

RCE: Once you became acquainted with the team at Three Rivers Health, what were some of the steps you took in orchestrating a turnaround?

Jackson: One was the rationalization of the cost report and the tools that we had for preparing cost report estimates. Our CFO had never worked in healthcare finance, so we employed a contractor to manage part of our revenue cycle operations because the work is so specialized. We slowly transitioned from the contractor doing much of the work [in this area] to having staff take on more of that work as they gained experience.

The first year, we did an interim rate review, and we asked for the rates to go up, knowing that we would need the cash. And then the next year, we came back, but we pulled it back. So the rate has come down each subsequent year. That is a strategy for cash management.

We also challenged staff to take responsibility for the care of the community by talking about the new services we have with their friends and neighbors, because we don’t have money for advertising. As we shifted our focus from hospital care to external care, such as our in-home nursing program, this communication serves so many purposes. We’re physically present in the community. We understand the patients better than anybody else.

RCE: I can only imagine the type of skill sets that might be available for RCM in your community at a time when a lot of bigger organizations are struggling to bring in that talent. How did you build up the strengths of Three Rivers’ revenue cycle team?

Jackson: I’m a little odd in that one of my first bosses, when I was a clinic supervisor for PeaceHealth in Ketchikan, Alaska, was the CFO for the region, and so I worked with him every year on all the budgets. When I first came into that position, I actually went there every morning and worked on collections, so I have a pretty deep knowledge of RCM

The problem here was that things were so broken that my predecessors didn’t really understand how broken they were because they’d never worked in a place where everything was broken. In getting everyone looking forward, we really invested in training and ownership of the whole process rather than keeping RCM and finance at arm’s length. We offered the CFO training through the National Rural Health Association, and we sent everyone on the leadership team to a cost reporting class. We also arranged for education around coding and billing for the entire revenue cycle team. We started with what team members could do, and then we had a contractor supporting the rest of the billing cycle as our staff gained more experience.

RCE: Now that you’ve made a turnaround like this as a group, what are you most looking forward to seeing in the next three to five years?

Jackson: Our population is not growing. We’re the poorest county in the state, and we have a high incidence of chronic disease, so we may get to the point where becoming a rural emergency hospital makes sense. If the Rural Health Transformation Program [RHTP] funds in the state of Wyoming come through, it’s possible that our facility master planning would allow us to redevelop the building, make it more appropriate, mechanically and for the future. And we could do nothing, and operate as we are, and we could still make enough money and provide excellent service. We could partner with another hospital in the area. There are different types of partnerships we could consider. We have an affiliation agreement with Billings Clinic. Maybe they could come in and take a more active role. There are a lot of possibilities to consider over the next five years.

RCE: But you’re optimistic no matter what about the future for your organization.

Jackson: We will be able to be OK without the RHTP funds. [Editor’s note: Three Rivers Health recently learned it will receive RHTP funding.] We will be okay if we have a bad year. Right now, we have about $3.5 million in cash and just about $4.5 million in long-term debt and about $1.4 million in accounts payable. In five years, we will have more cash. When I leave Three Rivers, I’m going to leave it in a place where the next person can just focus on the future.