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When it comes to cash flow, presumably every wants to healthcare organization among the best performers. Many organizations, how. ever, do not know how to reach this level of achievement. One proven way to improve cash flow is by employing benchmarking techniques and measuring results against the standards of high-performing organizations.
Benchmarking for receivables improvement can be a two-step process. First, healthcare financial managers should study the receivables statistics of the best performing healthcare organizations in the country. Second, site visits should be conducted to see how these organizations conduct their business.
WHY IS BENCHMARKING IMPORTANT?
The healthcare industry is in the midst of a paradigm shift. Regardless of the outcome of healthcare reform, competition among all providers is going to become more fierce as employers seek the best value for their money. As managed care alternatives continue to grow, healthcare organizations that fail to provide low-cost, high-quality healthcare will not survive. Being a "best performer" is the key to surviving this paradigm shift.
"We do not want to be average--we want to be the best," says Lee Johnson, director of patient financial services, Community Hospitals of Central California, a three-hospital organization in Fresno, California. Johnson's organization began benchmarking two years ago and found that studying the statistics of high-performing organizations is a vital tool in setting goals for Community Hospitals.
INDICATORS TO REVIEW
In addition to reviewing major indicators of the quality of receivables management such as gross...