More Related Content Similar to The Happy Marriage of Hospital Finance and Frontline Operations (20) More from Health Catalyst (20) The Happy Marriage of Hospital Finance and Frontline Operations2. © 2016 Health Catalyst
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Improving Healthcare Accounting in Operations
Many finance offices within the healthcare
sector are facing a dilemma.
They are consumed with the daily tasks of
accounting for the revenue and expenses
of the organization, keeping up with new
and changing regulations, and simply
closing the books.
Unfortunately, this leaves little time for them
to partner with the operational frontline, but
there are remedies for improvement.
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Improving Healthcare Accounting in Operations
I was with a finance department that sought
to better understand what operational
customers valued and needed.
By initiating dialog, we heard directly
from frontline leaders that the tasks
consuming finance were those that
operations considered “administrative”
or “controller-type.”
Although vitally important and necessary,
these activities weren’t what the operational
frontline valued. Operational stakeholders
were surveyed to gather direct feedback.
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Improving Healthcare Accounting in Operations
The goal of the exercise was to:
Improve communication between finance and its
stakeholders, and understand the needs and requirements
of their constituents
Provide information on how effectively finance was meeting
its stakeholders’ needs
Help the finance department identify roles/services that
stakeholders desire from them
Establish a baseline for developing the appropriate trans-
formation strategy and associated delivery service model
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Improving Healthcare Accounting in Operations
The survey results indicated that stakeholders perceive that finance spends
over 60 percent of its time on administrative and controller-type tasks.
FINANCE TASK
Stakeholder perception
of time spent
Administrator Spends time processing transactions and is tactically
focused on fulfilling requests.
38%
Controller Spends time setting policy and ensuring process and
policy compliance.
24%
Valued Business
Partner
Spends time with other business/functional heads.
Interested in improving my business metrics rather
than finance’s agenda.
20%
Finance Expert Spends time providing insight and information to
managers on finance issues.
18%
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Improving Healthcare Accounting in Operations
Feedback from the operational frontline included comments like:
Stop assuming you know what we need
Become less siloed
Stop withholding information
Stop changing the operational definitions and be more transparent
about how the data is derived
Help us to understand the targets and what is driving the variances
Eliminate your paper processes
Standardize on a process; it’s tough to manage to targets and
processes that continually change
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Improving Healthcare Accounting in Operations
The feedback speaks to the reality of the
situation. Staff in finance offices across
the country are working incredibly hard
just to keep the lights on. … and it’s
never enough. It’s a daunting task.
The first step is to admit there is
a problem.
If the organization supports a transition
from the current reality to a finance team
that teams up with operations to elevate
performance across the organization,
then it’s time to begin the journey
toward reinventing the finance office.
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Get the Finance House in Order
Create Simplicity, Transparency, and Trust
Cleaning up the hospital finance
department back office starts with
removing the spaghetti flow of informa-
tion, where numerous requests for
reports overwhelm analysts as they sift
through disparate systems to surface
information that will help tell the
financial story.
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Get the Finance House in Order
Figure 1 illustrates a complex
data flow. This is a painstaking
process and one that repeats
itself each and every month.
It definitely creates job
security, but there is a better
way to redirect this effort from
number crunching to one
valued by frontline operations.
The finance department can
work to transform this.
FIGURE 1
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Get the Finance House in Order
The Enterprise Data Warehouse (EDW)
is a safe, central repository of data that
is organized and optimized for measure-
ment, analysis, and reporting.
The true value of the data warehouse is
to organize data, provide links across
disparate data sources (so the analysts
don’t have to), and provide access so
analysts and clinicians can “fish for
themselves.”
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Get the Finance House in Order
Liberate the Financial Analysts
The finance office needs to liberate
financial analysts from their number
crunching activities.
Giving them access to a single source of
truth where information is standardized
and organized for fast access will greatly
enhance their support.
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Get the Finance House in Order
Jeremy Hope, the founder of the Beyond
Budgeting Roundtable, wrote this in his
book, “Reinventing the CFO”:
…companies today demand far more
from their CFOs than simply managing
the numbers. They expect strategic
support and leadership that can boost
manager’s performance throughout the
firm and enhance the bottom line.”
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Get the Finance House in Order
Begin to reduce the complexity
of the analytic infrastructure to
start seeing a more controlled
and predictable process, and
one that improves the job
satisfaction of all involved.
Instead of waiting for the local
Excel guru to export the data to
his PC, reformat it, manipulate it,
and publish it, the information
will be available every
morning upon login.
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Understand Where You Stand in the Eyes of Your
Customer – What Do They Value?
Were you to ask clinical and operational
leaders how well the finance team is
meeting their needs, their feedback would
align pretty closely with our earlier survey.
There is such variability across clinical
operations in its ability to understand
basic financial concepts.
This isn’t surprising since most started
as compassionate clinicians who
treat patients.
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Understand Where You Stand in the Eyes of Your
Customer – What Do They Value?
Most of them dread the finance aspect of
their jobs because we provide them with
reports they don’t understand, from a
myriad of disconnected systems, in terms
they don’t recognize, and ask them to
explain variances without access to the
information they need.
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Understand Where You Stand in the Eyes of Your
Customer – What Do They Value?
Finance can step up and help them enhance
their basic financial acumen, help them find
information to tell the story and help them to run
and elevate the performance of their business.
The first task for the CFO is to liberate both
finance and business managers from huge
amounts of detail and the proliferation of
complex systems that increase their
workload and deny them time for reflection
and analysis. This means purging their
systems, measures, and reports and
eradicating work that adds little value.”
- Jeremy Hope
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Reinventing the Finance Office
Let the journey begin
Pick a seasoned financial analyst to pilot a
financial liaison role. Consider co-locating
that resource with the clinical/operational
leader(s) they will support.
They can sit side-by-side with the leader
during the preparation and delivery of
the operational/financial reviews.
They will quickly begin to understand
first-hand how they can better support
these leaders.
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Reinventing the Finance Office
Let the journey begin
I’m confident clinical operations staff will
appreciate the help and will begin to
step up their game in terms of running
their businesses.
This will also allow the operational
leader time to reflect on their business
and how to enhance their performance.
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For more information:
“This book is a fantastic piece of work”
– Robert Lindeman MD, FAAP, Chief Physician Quality Officer
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Jane Felmlee joined Health Catalyst in January, 2014 but has worked with the company since
2010 serving as administrative sponsor for the 2nd Health Catalyst client, North Memorial
Healthcare, located in the Twin Cities. Jane has worked in healthcare for over 25 years serving in
various roles at Mayo Clinic, Park Nicollet, and North Memorial Health Care. Her contributions
span the areas of Information Technology, Decision Support, Audit, Accounting/Finance, and Lean
Promotion Office.
Jane holds a bachelor degree in accounting from the University Of Minnesota Carlson School Of Business and
is a Certified Public Accountant (inactive), Certified Information Systems Auditor, and is Lean Certified.
Other Clinical Quality Improvement Resources
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