Posting Notice
The Unlearned Lessons of Failing Community Health Centers –
Part 3 - Financial Statements as Fairytales
(Financial Statements that have a somewhat flexible relationship with reality) - will be posted on Monday, March 2, 2009.
Next post: The Unlearned Lessons of Failing Community Health Centers – Part 3 - Financial Statements as Fairytales …
Saturday, February 28, 2009
Friday, February 27, 2009
The Unlearned Lessons of Failing Community Health Centers – Part 2
The Unlearned Lessons of Failing Community Health Centers – Part 2
The Evolution of CHC Financial Statements into a Dark Art –
As we continue to address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured, we need to stay alert to these issues:
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
Healthcare for the uninsured and underinsured is a dark waltz with disaster.
The way this can be dealt with immediately is through local Community Health Centers that are well-led, well-managed, and well-financed.
If Community Health Centers are vital to resolving the health crisis, what can Community Health Center Board members do to help their Center?
Our sense is that Boards can insist that their Executive Director immediately overcome the following four issues:
1. The lack of transparency.
2. The evolution of community health center financial statements into a dark art.
3. Financial statements as fairytales.
4. The failure of the executive director to believe, despite their mission, and demonstrate through measurable behaviors, that CHCs are established to serve all the medically underserved in its area.
Yesterday we discussed: 1. The Lack of Transparency.
Today we address:
2. The Evolution of CHC Financial Statements into a Dark Art –
Examples:
§ Consecutive monthly Board meetings without a substantive discussion of:
1. Accounts Receivables (A/R) and A/R aging
2. The Executive Director’s report on what the community health center is currently doing
3. The Board questioning the Executive Director on what the center has stopped doing
§ The monthly financial statements submitted to the Centers’ Board consistently report a steady and smooth growth.
Questions to ask
Can the Board and ED understand the complexity of its financial statements?
Can they articulate the complexity of the CHC financial structure?
Can they articulate the CHC’s current debt, debt service, and payments?
Do the Executive Director and Chief Financial Officer “manage” the centers’ reported income and liabilities on the financial statements?
Next post: The Unlearned Lessons of Failing Community Health Centers –
Part 3 - Financial Statements as Fairytales – Financial Statements that have a somewhat flexible relationship with reality.
The Evolution of CHC Financial Statements into a Dark Art –
As we continue to address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured, we need to stay alert to these issues:
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
Healthcare for the uninsured and underinsured is a dark waltz with disaster.
The way this can be dealt with immediately is through local Community Health Centers that are well-led, well-managed, and well-financed.
If Community Health Centers are vital to resolving the health crisis, what can Community Health Center Board members do to help their Center?
Our sense is that Boards can insist that their Executive Director immediately overcome the following four issues:
1. The lack of transparency.
2. The evolution of community health center financial statements into a dark art.
3. Financial statements as fairytales.
4. The failure of the executive director to believe, despite their mission, and demonstrate through measurable behaviors, that CHCs are established to serve all the medically underserved in its area.
Yesterday we discussed: 1. The Lack of Transparency.
Today we address:
2. The Evolution of CHC Financial Statements into a Dark Art –
Examples:
§ Consecutive monthly Board meetings without a substantive discussion of:
1. Accounts Receivables (A/R) and A/R aging
2. The Executive Director’s report on what the community health center is currently doing
3. The Board questioning the Executive Director on what the center has stopped doing
§ The monthly financial statements submitted to the Centers’ Board consistently report a steady and smooth growth.
Questions to ask
Can the Board and ED understand the complexity of its financial statements?
Can they articulate the complexity of the CHC financial structure?
Can they articulate the CHC’s current debt, debt service, and payments?
Do the Executive Director and Chief Financial Officer “manage” the centers’ reported income and liabilities on the financial statements?
Next post: The Unlearned Lessons of Failing Community Health Centers –
Part 3 - Financial Statements as Fairytales – Financial Statements that have a somewhat flexible relationship with reality.
Thursday, February 26, 2009
The Unlearned Lessons of Failing Community Health Centers
The Unlearned Lessons of Failing Community Health Centers
As we address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured, we need to stay alert to these issues:
To recap:
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
Healthcare for the uninsured and underinsured is a dark waltz with disaster:
From 13 consecutive months of job loss,
To 20,000,000 people unemployed, underemployed, or working part-time,
To 54% of chronically ill giving-up necessary medical care due to lack of money, (http://www.commonwealthfund.org/index.htm
To a 1% increase in unemployment resulting in an increase of 1,000,000 people with no health insurance (Kaiser Family Foundation - http://www.kff.org/ and NewsHour – PBS -HealthBeat -http://www.pbs.org/newshour/indepth_coverage/health/uninsured/index.html
To State Medicaid denials rising - http://www.washingtonpost.com/wp-dyn/content/article/2009/02/11/AR2009021104311.html
To the U.S. economy has shedding more jobs that the total population of Chicago – Heidi Shierholz – Economic Policy Institute - http://www.epi.org/quick_takes/entry/3.5_million_jobs_lost/
If these men, women, and children do not have the money for adequate food, clothing, or shelter, how can we expect that they can afford basic, primary healthcare for pre-natal, early childhood, and chronic diseases?
This can be dealt with immediately through local Community Health Centers that are well-led, well-managed, and well-financed.
If Community Health Centers are vital to resolving the health crisis, what can Community Health Center Board members do to help their Center?
Our sense is that Boards can insist that their Executive Director immediately overcome the following four issues:
1. The lack of transparency.
2. The evolution of community health center financial statements into a dark art.
3. Financial statements as fairytales.
4. The failure of executive directors to believe, despite their mission, and demonstrate through measurable behaviors, that CHCs are established to serve all the medically underserved in its area.
1. The Lack of Transparency –
Examples:
§ An Executive Director who fails to take responsibility for errors.
§ An Executive Director who does not consistently deflect credit onto staff.
§ An Executive Director who understands all of the community health center’s monthly financials.
§ Failure to present monthly financials to the Governing Board – including cash flow statements – in advance of the monthly meeting.
§ Failure to receive accompanying explanations of those monthly financial statements.
§ Failure to receive copies of the annual outside audit with Management Letters – in advance of the monthly meeting.
§ Inability of Executive Director and Board members to understand exactly how their Center makes money (hint: it’s not through grants or loans).
Questions to ask
Are the Board the Senior Managers able to understand and monitor how their CHC makes and spends money?
Can they articulate that understanding?
Can the Board and Senior Managers articulate an understanding of Income and Liabilities in relation to Accounts Receivable (A/R) and A/R aging?
Next Post: The Unlearned Lessons of Failing Community Health Centers – Part 2: The Evolution of CHC Financial Statements into a Dark Art –
As we address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured, we need to stay alert to these issues:
To recap:
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
Healthcare for the uninsured and underinsured is a dark waltz with disaster:
From 13 consecutive months of job loss,
To 20,000,000 people unemployed, underemployed, or working part-time,
To 54% of chronically ill giving-up necessary medical care due to lack of money, (http://www.commonwealthfund.org/index.htm
To a 1% increase in unemployment resulting in an increase of 1,000,000 people with no health insurance (Kaiser Family Foundation - http://www.kff.org/ and NewsHour – PBS -HealthBeat -http://www.pbs.org/newshour/indepth_coverage/health/uninsured/index.html
To State Medicaid denials rising - http://www.washingtonpost.com/wp-dyn/content/article/2009/02/11/AR2009021104311.html
To the U.S. economy has shedding more jobs that the total population of Chicago – Heidi Shierholz – Economic Policy Institute - http://www.epi.org/quick_takes/entry/3.5_million_jobs_lost/
If these men, women, and children do not have the money for adequate food, clothing, or shelter, how can we expect that they can afford basic, primary healthcare for pre-natal, early childhood, and chronic diseases?
This can be dealt with immediately through local Community Health Centers that are well-led, well-managed, and well-financed.
If Community Health Centers are vital to resolving the health crisis, what can Community Health Center Board members do to help their Center?
Our sense is that Boards can insist that their Executive Director immediately overcome the following four issues:
1. The lack of transparency.
2. The evolution of community health center financial statements into a dark art.
3. Financial statements as fairytales.
4. The failure of executive directors to believe, despite their mission, and demonstrate through measurable behaviors, that CHCs are established to serve all the medically underserved in its area.
1. The Lack of Transparency –
Examples:
§ An Executive Director who fails to take responsibility for errors.
§ An Executive Director who does not consistently deflect credit onto staff.
§ An Executive Director who understands all of the community health center’s monthly financials.
§ Failure to present monthly financials to the Governing Board – including cash flow statements – in advance of the monthly meeting.
§ Failure to receive accompanying explanations of those monthly financial statements.
§ Failure to receive copies of the annual outside audit with Management Letters – in advance of the monthly meeting.
§ Inability of Executive Director and Board members to understand exactly how their Center makes money (hint: it’s not through grants or loans).
Questions to ask
Are the Board the Senior Managers able to understand and monitor how their CHC makes and spends money?
Can they articulate that understanding?
Can the Board and Senior Managers articulate an understanding of Income and Liabilities in relation to Accounts Receivable (A/R) and A/R aging?
Next Post: The Unlearned Lessons of Failing Community Health Centers – Part 2: The Evolution of CHC Financial Statements into a Dark Art –
Wednesday, February 25, 2009
Community Health Centers: Leadership – Structure – Finance: The Business Model.
Community Health Centers: Leadership – Structure – Finance: The Business Model.
We continue to address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured.
Healthcare in America is not a looming crisis. It is not a pending catastrophe. American healthcare is in a state of crisis now. As has been outlined in prior posts, healthcare for the uninsured and underinsured is a dark waltz with disaster.
If these (unemployed, underemployed, and part-time employed who are uninsured or underinsured) men and women cannot afford adequate food, clothing, or shelter, then, they certainly cannot afford basic, primary healthcare for pre-natal, early childhood, and chronic diseases.
The way this can be dealt with immediately is through well-led, well-managed, and well-financed, local Community Health Centers.
This post addresses:
Community Health Centers - Leadership, Structure, and Finance: The Business Model.
Healthcare Is Unique
Healthcare is a unique, complex, three-way relationship between:
Patient
Physician
Insurer
The Components Of This Unique System Are:
Patients, who consume services but don't generally pay for the entire cost
of medical services...,
Providers, who not only provide, but also prescribe services, in essence
making the decision to buy on behalf of the patient...,
Payors, who neither provide nor consume medical services.
The Business Model Objective and The Expected Results
To implement an effective business to address the mirror issues of consistent quality care and maximum revenue - with the following results:
Leadership
1. Manage the annual budget, monthly financial reporting, and capital improvement planning processes.
2. Develop and implement financial policies and procedures – Including due diligence reviews.
3. Expand Health Programs from single focus to comprehensive services.
Attain scores of over 96% in 3rd party Payor audits.
Structure
1. Developed a full-service, system-wide MIS Department that implements an EMR/IMS process while increasing visits per day and decreasing costs.
2. Enhance managers’ professional skills of planning, organizing, staffing, directing, and monitoring.
Finance
1. Increase monthly revenue by ____
2. Reduce costs by ____
3. Decrease Internal A/R from ____ days to ____ days.
4. Reduce External A/R from ____ days to ____ days.
The Business Model Implementation
Many Community Health Center Boards and Executive Directors talk a good game of being the best, the soonest, with the most; however, as with most things of importance, the devil is in the implementation.
As has been made clear in many prior posts, many Executive Directors do not know how to implement to attain the objective of serving the medically underserved. For instance:
How much has your Center’s patient base grown in the past year?
How much has your visits per day per provider grown in the last year?
Are you growing, or treading water?
What excuses are you, as a Board member, hearing about this failure to grow in serving the underserved?
Is your lack of knowledge keeping your health center from growing to serve the underserved?
Who is responsible for this failure to grow?
Who is being held responsible for that failure?
The Business Model Questions
Is your Community Health Center functioning in a manner that allows it to serve the maximum number of underserved in its area? … Or,
Is your Center operating at the leisure of the providers? … Or,
Has it been operating as a mere boutique business?
Are your hours set to serve the underserved, or to serve the employees?
Does your Governance Board conduct itself in a fiduciary manner – with all the obligations inherent in that role?
Does your Executive Director have the knowledge, skill, values, manners temperament, and experience necessary to do the job?
Is your financial staff giving you the information your need, or just the information that makes your feel better?
Did you actually read, question, and understand the last outside audit?
Did you raise any questions?
Were those questions answered to your satisfaction?
How deep did you dig into last month’s financial statements?
Next series of posts: The Unlearned Lessons of Failing Community Health Centers –In Four Parts.
We continue to address Community Health Centers’ central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured.
Healthcare in America is not a looming crisis. It is not a pending catastrophe. American healthcare is in a state of crisis now. As has been outlined in prior posts, healthcare for the uninsured and underinsured is a dark waltz with disaster.
If these (unemployed, underemployed, and part-time employed who are uninsured or underinsured) men and women cannot afford adequate food, clothing, or shelter, then, they certainly cannot afford basic, primary healthcare for pre-natal, early childhood, and chronic diseases.
The way this can be dealt with immediately is through well-led, well-managed, and well-financed, local Community Health Centers.
This post addresses:
Community Health Centers - Leadership, Structure, and Finance: The Business Model.
Healthcare Is Unique
Healthcare is a unique, complex, three-way relationship between:
Patient
Physician
Insurer
The Components Of This Unique System Are:
Patients, who consume services but don't generally pay for the entire cost
of medical services...,
Providers, who not only provide, but also prescribe services, in essence
making the decision to buy on behalf of the patient...,
Payors, who neither provide nor consume medical services.
The Business Model Objective and The Expected Results
To implement an effective business to address the mirror issues of consistent quality care and maximum revenue - with the following results:
Leadership
1. Manage the annual budget, monthly financial reporting, and capital improvement planning processes.
2. Develop and implement financial policies and procedures – Including due diligence reviews.
3. Expand Health Programs from single focus to comprehensive services.
Attain scores of over 96% in 3rd party Payor audits.
Structure
1. Developed a full-service, system-wide MIS Department that implements an EMR/IMS process while increasing visits per day and decreasing costs.
2. Enhance managers’ professional skills of planning, organizing, staffing, directing, and monitoring.
Finance
1. Increase monthly revenue by ____
2. Reduce costs by ____
3. Decrease Internal A/R from ____ days to ____ days.
4. Reduce External A/R from ____ days to ____ days.
The Business Model Implementation
Many Community Health Center Boards and Executive Directors talk a good game of being the best, the soonest, with the most; however, as with most things of importance, the devil is in the implementation.
As has been made clear in many prior posts, many Executive Directors do not know how to implement to attain the objective of serving the medically underserved. For instance:
How much has your Center’s patient base grown in the past year?
How much has your visits per day per provider grown in the last year?
Are you growing, or treading water?
What excuses are you, as a Board member, hearing about this failure to grow in serving the underserved?
Is your lack of knowledge keeping your health center from growing to serve the underserved?
Who is responsible for this failure to grow?
Who is being held responsible for that failure?
The Business Model Questions
Is your Community Health Center functioning in a manner that allows it to serve the maximum number of underserved in its area? … Or,
Is your Center operating at the leisure of the providers? … Or,
Has it been operating as a mere boutique business?
Are your hours set to serve the underserved, or to serve the employees?
Does your Governance Board conduct itself in a fiduciary manner – with all the obligations inherent in that role?
Does your Executive Director have the knowledge, skill, values, manners temperament, and experience necessary to do the job?
Is your financial staff giving you the information your need, or just the information that makes your feel better?
Did you actually read, question, and understand the last outside audit?
Did you raise any questions?
Were those questions answered to your satisfaction?
How deep did you dig into last month’s financial statements?
Next series of posts: The Unlearned Lessons of Failing Community Health Centers –In Four Parts.
Tuesday, February 24, 2009
Community Health Center Leadership – Structure – Finance: An Overview
Community Health Center Leadership – Structure – Finance: An Overview
In this ongoing series, we address Community Health Centers (CHC) and their central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured.
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
With job and health insurance losses, healthcare for the uninsured and underinsured is a dark waltz with disaster.
If people cannot afford adequate food, clothing, or shelter; then, they certainly cannot afford basic, primary healthcare.
The unemployed, underemployed, and part-time employed who are uninsured or underinsured can receive medical services through local Community Health Centers that are well-led, well-managed, and well-financed. The demand for vital, robust, and financially sustainable Community Health Centers is critical. But what is the key foundation for a vital CHC?
This post addresses that issue:
Leadership – Structure – Finance: An Overview
Integrity (defined)
The ability to understand, and convert into action, as their primary task and duty, the foremost need of the organization –
The ability to see the world as it actually, not as they want it to be (which, of course, is vision, which, in some cases, could lead to illusion).
Leadership Integrity, leads to- Structural Integrity - Selecting and adhering to the top four elements, which leads to - Financial Integrity - Selecting and adhering to predictive indicators.
Leadership Integrity:
The ability to see the world as it actually, not as you may want it to be.
Leadership
The ability to see the world as it actually is, not as you pretend it to be.
1. Do they understand, and convert into action, the foremost governance need of the organization as their first and primary task and duty?
2. Are they demagogic (manipulating, obscuring, and/or distorting)?
3. Not just playing well themselves, but helping others play better…
Structural
The ability to see the world as it actually is, not as you pretend it to be.
1. Do they understand, and convert into action, the foremost structural need of the organization as their first and primary task and duty?
2. Effective business vision
3. Focus on value creation (Human Assets, Expertise, Parameters, and Change)
4. Foster internal forces that encourage progress
Financial
The ability to see the world as it actually is, not as you pretend it to be.
Do they understand, and convert into action, the foremost financial need of the organization as their first and primary task and duty?
1. Positive cash flow …
2. Total physician compensation at 45% of net collections …
3. Total medical group expenses at 88% of total net collections …
4. Internal accounts receivable less than 3 days …
5. External accounts receivable less than 46 days …
The Key Issues
1. Do each of these elements: Leadership, Structure, and Financial, have integrity?
2. Do they understand, and convert into action, the foremost need of the organization - as their first and primary task and duty?
3. Do they have, and convert into action, a one-line job description? (The most difficult of tasks)
4. Do they understand, and convert into action self-executing mechanisms?
5. Do they have, and convert into action, their core competencies?
6. Are their core competencies relevant?
7. Are they effective, or merely efficient, or neither?
8. Are they efficacious?
9. Are they muscle, fat, or cancer?
10. Do they staff from strengths or weaknesses?
Next post: Leadership – Structure – Finance: The Business Model.
In this ongoing series, we address Community Health Centers (CHC) and their central role in providing primary health care to the unemployed, underemployed, and part-time employed who are uninsured or underinsured.
Healthcare in America is not a looming crisis.
It is not a pending catastrophe.
American healthcare is in a state of crisis now.
With job and health insurance losses, healthcare for the uninsured and underinsured is a dark waltz with disaster.
If people cannot afford adequate food, clothing, or shelter; then, they certainly cannot afford basic, primary healthcare.
The unemployed, underemployed, and part-time employed who are uninsured or underinsured can receive medical services through local Community Health Centers that are well-led, well-managed, and well-financed. The demand for vital, robust, and financially sustainable Community Health Centers is critical. But what is the key foundation for a vital CHC?
This post addresses that issue:
Leadership – Structure – Finance: An Overview
Integrity (defined)
The ability to understand, and convert into action, as their primary task and duty, the foremost need of the organization –
The ability to see the world as it actually, not as they want it to be (which, of course, is vision, which, in some cases, could lead to illusion).
Leadership Integrity, leads to- Structural Integrity - Selecting and adhering to the top four elements, which leads to - Financial Integrity - Selecting and adhering to predictive indicators.
Leadership Integrity:
The ability to see the world as it actually, not as you may want it to be.
Leadership
The ability to see the world as it actually is, not as you pretend it to be.
1. Do they understand, and convert into action, the foremost governance need of the organization as their first and primary task and duty?
2. Are they demagogic (manipulating, obscuring, and/or distorting)?
3. Not just playing well themselves, but helping others play better…
Structural
The ability to see the world as it actually is, not as you pretend it to be.
1. Do they understand, and convert into action, the foremost structural need of the organization as their first and primary task and duty?
2. Effective business vision
3. Focus on value creation (Human Assets, Expertise, Parameters, and Change)
4. Foster internal forces that encourage progress
Financial
The ability to see the world as it actually is, not as you pretend it to be.
Do they understand, and convert into action, the foremost financial need of the organization as their first and primary task and duty?
1. Positive cash flow …
2. Total physician compensation at 45% of net collections …
3. Total medical group expenses at 88% of total net collections …
4. Internal accounts receivable less than 3 days …
5. External accounts receivable less than 46 days …
The Key Issues
1. Do each of these elements: Leadership, Structure, and Financial, have integrity?
2. Do they understand, and convert into action, the foremost need of the organization - as their first and primary task and duty?
3. Do they have, and convert into action, a one-line job description? (The most difficult of tasks)
4. Do they understand, and convert into action self-executing mechanisms?
5. Do they have, and convert into action, their core competencies?
6. Are their core competencies relevant?
7. Are they effective, or merely efficient, or neither?
8. Are they efficacious?
9. Are they muscle, fat, or cancer?
10. Do they staff from strengths or weaknesses?
Next post: Leadership – Structure – Finance: The Business Model.
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