- Performed a financial turnaround and major organization restructuring for a freestanding multi-specialty group practice having more than 120 physicians and a contracted provider network of more than 1,000 providers. This nationally prominent group practice located in the northwest United States was losing more than ten million dollars each year for the past eight years. A preliminary decision had been made by the Board to consider dissolution of the group. Webb Associates provided the Chief Executive Officer, Chief Financial Officer, Chief Turnaround Officer and physicians knowledgeable in compensation planning and revenue enhancement to direct a major turnaround.
The following accomplishments were attained over a nine-month period:
- Average losses of one million dollars per month were turned into average profits of three hundred thousand dollars per month and budgets were attained in each of the first ten months.
- Thirty-six physicians resigned from the practice and thirty-two replacements were recruited.
- A physician income distribution plan was installed which tied compensation to individual physician and the physician group productivity to company profitability.
- A government board structure was replaced by a 501(c)3 board structure and leading entrepreneurial leaders from the community were recruited to assist the physicians in attaining organizational growth and development.
- Major joint ventures in imaging, ambulatory surgery, eye surgery, infusion therapy and endoscopy laboratories were negotiated to infuse more than seven million dollars in profits per year into the group.
- Major contracts were negotiated to link the group more closely to the vast number of military installations in the regions and additional satellite centers created to accommodate the new business.
- All payor contracts were renegotiated and switched from risk contracts to fee-for-service contracts in a fashion that spread out the IBNR spend down implications.
- Every major business process was reengineered and training programs implemented.
- Staffing levels were reduced from 5.4 FTE per provider to 3.7 FTE per provider with no change in provider morale or patient satisfaction.
- A major planning and capitalization program was implemented to create four comprehensive multi-specialty centers throughout the region, linked to numerous primary care centers and anchored by a tertiary hospital through multiple joint ventures.
- Directed the turnaround of a financially distressed multi-specialty teaching group practice of 49 physicians in a midwestern city. The group was losing $1,800,000 per year and had debts to hospitals in excess of $3,000,000 at the start of the engagement. When the project was completed, the group was earning $2,100,000 per year and had refinanced the hospital debt and had paid down $500,000 of the debt. The project involved a complete redesign of the billing and collection systems, reengineering of the revenue cycle, labor reductions, coding training and additional ancillary service implementation. Physician collections were increased from an average of $380,000 per physician to an average of $491,000 per year.
- Provided all of the analysis, planning and facilitation to move 32 physicians in five specialties from employment by a community hospital to 10 independent groups of physicians. The hospital had been losing between $4 and $5 million per year for several years on the practices. We designed the books and records, secured line-of-credit, negotiated facility and equipment leases, specified medical information systems and designed patient records, forms, etc. Through a sensitive communication process, we were able to retain 96% of the hospital outpatient and inpatient referral revenue in a community where competition for physician practices among competing hospitals was fierce. One year after completion of the project every group that was formed had exceeded their revenue and profit goals. Three of the groups grew significantly and they were able to recruit additional partners.
- Redesigned all aspects of the income distribution plan for a 68-physician multi-specialty practice in a major northwestern city. Also redesigned the revenue cycle, implemented structured training programs for physician and non-physician staff. The clinic was successful in attracting fourteen primary care physicians with the new income distribution plan and the days in receivables dropped from 129 days to 52 days over twelve months
- Redesigned the income distribution plan, good setting process and evaluation tools for a “big 10” university faculty foundation with more than 400 physicians. The plan increased productivity and greatly enhanced the publication of scientific papers. It also dropped physician turnover from more than 18% per year to less than 5% in a period of three years.
- Re-designed and re-organized a Neurosurgical and Neurology Physician Group in a major New York City teaching hospital and medical school. Improvements increased collections by 42% and increased profits by $2.3 million annually.
- Designed and implemented an integrated healthcare delivery system involving an 1,100 bed teaching hospital in the Southeastern United States, four community hospitals and 1350 physicians on the combined medical staff of the hospitals. Obtained a full risk capitation contract with a national insurer that is expected to grow from 17,000 lives now to more than 108,000 lives in four years. Designed the managed care contracting strategy, the physician compensation model and the utilization Management program.
- Merged the practices of 65 primary care physicians in a Midwestern city working out of 19 practices in 22 locations into a single group and developed a wrap-around IPA of 300 specialty physicians to obtain and manage full professional risk HMO contracts. Over a 21-month period, collections were increased from $27,000,000, or $353,800 per physician, to $29,900,000, or $506,780. We also reduced the number of computer systems from 14 systems to 8 systems and consolidated locations, reducing the number from 22 to 14. Overall physician productivity was increased by 23%.
- Guided a group of 23 South Florida primary care physicians working out of seven locations through a process that achieved the following results:
- Reduced the number of locations from seven to four
- Added six physician extenders and three social workers
- Reduced A/R from 165 days to 48 days
- Turned annual losses from $1,288,000 or $56,000 per physician into annual profits of $1,472,000, or $43,294 per provider.
- Instituted “affinity classes” for patients with asthma, hypertension and diabetes to generate $900,000 in additional profits for the practice.
- Designed an equity model physician organization that will enroll 600 primary care and 400 specialty physicians within three years in a large Midwestern city. The group is designed to manage full ambulatory capitation in concert with seven merged hospitals. The group has already attracted more than 120 physicians in less than six months.
- Redesigned workflow, chart coding, and staffing for a Midwestern Emergency Room that included formation of a new physician group practice. The Emergency Center was facing significant physician and patient dissatisfaction prior to the project and was experiencing annual drops in patient volume. Following the project, patient volumes started increasing at an annual rate of 12%, revenues increased 26% and patient satisfaction increased from 64% to 88% over a two-year period.
- Reorganized all back office functions and reengineered patient flow for a major medical school and teaching hospital in New York City. The plan increased collections by 28% and reduced staffing per MD by 4 FTES over a one year period
- Designed and obtained licensure and HCFA approval for a commercial and Medicaid HMO. Implemented all policies and procedures and recruited the staff. Recruited 10,000 members for the HMO in the Southeast associated with one of the four largest hospitals in the United States. The HMO will achieve break-even within 15 months; 2 years ahead of schedule.
- Developed a Management Services Organization (MSO) for a five-hospital chain and its associated physicians.
- Facilitated several retreats and guided the development of a capitated physician compensation system for a mid-size Seattle PHO that use risk pools to achieve behavior modification and premium savings.
- Developed an integrated community healthcare network that includes (through merger and acquisition) a not-for profit multi-specialty group practice, a joint venture PPO, a hospital and a home care and durable medical equipment company.
- Designed a physician-hospital organization (PHO) to create a group practice “without walls.” The organization negotiates managed-care contracts and provides economies through joint purchasing and joint development of data processing and personnel functions.
- Provided interim CEO leadership for implementing a detailed plan to stabilize cash flow, negotiate favorable terms with suppliers, streamline operations and restore credibility with lenders for a multi-specialty group practice and HMO.
- Conducted an analysis of an Emergency Room group to justify successfully a 16% increase in charges before a rate-setting authority.
- Structured a physician recruiting program to comply with the Medicare Fraud and Abuse Regulations for a mid-size Midwestern HMO, and thereby obtained hospital subsidies totaling more than $300,000 per year from local hospitals.
- Developed a strategic planning process that resulted in a mission and culture statement, goals, objectives and timetables, and elicited full participation by all physicians. Resulted in lower physician and non-physician turnover, improved financial performance and higher morale with greater teamwork.
- Conducted an organizational analysis eliminating $385,000 in management overhead while improving accountability and performance.
- Redesigned patient and general accounting functions and retrained all personnel. This change increased daily cash flow by 47% and reduced days in accounts receivable from 89 to 74.
- Developed a cohesive management team through a combination of psychological testing, personnel evaluation, individual and group developmental programming and management bonding and training programs. Program has helped individuals understand and use information that aids them in maximizing strengths and minimizing weakness within the framework of the goals and objectives of the company.
- Organized and implemented a management services organization (MSO) for a suburban hospital and its medical staff that owns the office real estate, hires the office staff, performs all administrative functions and charges the physicians on a fee-for-service basis.