(I know one of our former Program Directors will be disapointed that we are not discussing Jimmy Buffet, however, this discussion has more to do with revenue than Margaritas!)
This morning, Warren Buffett, CEO of Berkshire Hathaway and the “Oracle of Omaha”, wrote an opinion piece in the New York Times that I am sure will cause hundreds of ripples in the financial pool. His statement very clearly is to stop coddiling the “super-rich”. He is advocating a serious tax increase on himself and his friends who are as fortunate as himself to be considered a member of the top financial echelon of our country. This leader of industry has sounded the alarm that a fortunate circle of our country is not carrying it’s weight and is not paying their fair share. (He estimates that he pays about 17% on his earnings versus the 20%-40% the rest of the country usually pays.)
I see a similiar pattern in outpatient wound care centers as well. These programs, can, and should be making a serious contribution to the overall financial health of the hospitals they are in. However, often times they do not.
One reason may be that administration is simply not aware of options to the current fees they may be paying a management company. These companies may be collecting large fees without ensuring that the hospital is doing financially well on the program at the same time. These fees could constitute as much as 60% more than other options! Another may be that they are concerned about upsetting a service that seems to run for the most part on it’s own. However, I think the most common, is that these programs are often times not analyzed or scrutinized like so many other departments in a hospital. Daily numbers are not collected. Billing systems that are causing high numbers of denials go unchecked. Chargemasters may not be current. And the general contribution of these centers are not expected to meet the same standards as the rest of the hospital. In effect, these centers are paying the 17% rate when the rest of the departments may be paying the 40% rate!
There are options. We offer a seven day top-to-bottom review of wound care programs with recomendations for improving, clinical, operational, and financial issues. You can also start your own review by walking through a flow plan to determine if there are any holes you need to address. Either way, now is the time that every department should be doing all it can to assist in the overall financial success of your hospital.
I think Warren, and maybe even Jimmy would agree!