Cost Report Complacency:
The Downstream Financial Effects of Not Optimizing Medicare Cost Reporting

Introduction to Cost Reporting
Hey. Hello, and welcome to our webinar, cost report complacency, the downstream financial effects to Medicare cost reporting. I will turn it over to our speakers. Finthrive's Jonathan Wick, vice president of health care insights, and Amber Baker, solution strategy director. Jonathan, Amber, the floor is yours.
Great. Thank you so much, Becky, and good morning or good afternoon to those on the phone.
Amber and I are elated to talk to you about a fairly dry subject of cost reports, but we'll try to make it as fun and as exciting as we can. I know this is a subject that Amber is very passionate about, and, she's one of my favorite people at Finthrive in terms of her expertise and, ability to, have interaction with you all in terms of things that we can do to improve your financial position, through this. Basically, we're gonna go through, you know, market forces. I'll I'll take that piece and talk through, you know, what's going on with my cash position right now with the rating agencies and how, you know, through the CFO lens really we're looking at, the acute hospital and health system market, and just some headwinds and tailwinds that we're seeing there.
We'll talk a little bit about some of the challenges from Medicare and the Center for Medicare and Medicaid Services, from a from a puzzle standpoint, and then I'm gonna turn it over to the expert. I'm gonna try to stay out of her way today, and Amber's gonna talk through some of the things that Finthrive is doing in the market to really help, folks maximize the revenue, from those, finicky little government payers, that are out there. So that's kind of our, our agenda today. We'll dive right in.

Current Market Forces Impacting Hospitals
Let's talk market forces here for a minute. This survey just came out of Becker's, and I I I pulled it. I thought it was great. It talked about financial stability as being the number one focus right now for hospitals.
And, you know, I've I've been doing this a while. I started as a hospital transporter, was a was a chief revenue officer, for a few years, and I've been on the tech side here for almost a decade. And and I miss the hospitals, but what I don't miss is budget season or when things kinda troughed out. And I would argue that COVID and the wake of COVID really caused probably one of the worst financial years that health care has seen, since its history.
Twenty one and twenty two, were really trough years where after the CARES funding kind of exhausted and some other things really had to get negative margin shifting into a positive place.
Forbes Bazaars, who, put this survey together echoes, that settlement from executives in finance that stability is the number one issue facing hospitals right now. And what I like seeing is that revenue cycle represented as one of the strategies to get there. So Amber and I are gonna really focus in on the finance side of revenue cycle. I've got some slides here in a minute that are gonna talk about how the kind of the finance controlling treasury side of the business doesn't interact at the level that we would like it to as much with the revenue cycle level, activities and operations.
From a bad debt reporting, self pay charity clearance, kind of, collaborative thing. I think the cost report kinda lives in its own little cave. And and and once a year, the bear comes out of the cave and kinda talks the revenue cycle and says, hey. This is what we're doing.
And then then then revenue cycle goes back to turning and burning with patient accounts. And maybe I'm wrong. You know, correct me if if that's it, but that's how it was at my hospital. Most of the hospitals that I talked to is that relationship's not quite as tight as we would like.
I sat in on Fitch's, not for profit sector outlook last week, and this is a slide from there. Kevin Holler and I know each other. And they talked about these core credit drivers, and I wanna talk about the credit position of hospitals and health systems today. Really seeing labor costs availability and non labor operating costs go down.
And and that's why I think you're seeing the market move all three Reddit credit rating agencies have moved the market from negative or Fitch calls it deteriorating to stable. That's the first time I've seen that in a few years where all three are one doing the same thing and and and two, they're all positive. Now downgrade is still happening, at a rate probably higher than folks would like. And, those of you on the phone are are obviously finance, professionals, so I don't have to talk through the importance of bond ratings and and and how that, impacts your ability to borrow and your borrowing expense and what that looks like from a cash flow perspective.
But my point is that you're seeing a general positive trend. Kaufman Hall releases a hospital flash report every month. This is the December report, which just came out this week actually. And I wouldn't get too hung up on that November three point three percent there.
I I this is an index that's variable that that actually adjusts every month and so it kinda goes back. I I think you're gonna see a number of four and a half, five percent for November. But my point is is that we are well into a margin of proficiency as we move forward, where we're at. And on that Fitch outlook call that I have that I that I sat in on, Kevin and the analysts on there talked about this trifurcation concept, which I really like.
And as Amber and I are talking today, we we really wanna talk about kinda getting your altitude up, like, getting the cash yield back to you and getting credit for the carrier providing, be that from DISH, Medicare beneficiary bad debt, your IME GME, shadow billing, those types of things, making sure that you're getting every last dollar. When I worked at the hospital and Amber will echo this, Medicare does not pick up the phone and call you and say, hey. You know what? We think you need more money.
We we think that you you you didn't really report right and should adjust your cost report because it doesn't look right to us. That preponderance of being accurate and thorough, and I would argue efficient is left to the hospital. What Amber and I are seeing and she'll draw it she'll draw it into that a little bit more as an expert is is what's good enough for what's happening in the traditional way, is not getting to this upper echelon and and it and it follows what Fitch is saying here too. From a bond rating standpoint, which really is a function of the financial health of the organization.
If you're in that green area, you know, you're doing the same things, which is great. It's better than going down, but you need to move up. You need to become stronger as an organization, and they're showing that from this rating standpoint. And I would argue organizations that have an effective cost reporting strategy and are managing their government reimbursement in a way that's that's effective using third party technologies and expertise like we're gonna show you, are gonna be ones that have that higher altitude we talked about moving forward.
That said, this is definitive data here showing the tranches. This is about six to eighteen months old depending on where they're at. But we ran some data at Finthrive just on flat margins whether the operating margin is positive or negative. And it's important to understand if you go back to, like, this trifurcation, you know, where are you as an organization?
Are you in that middle, upper, or lower? If you're in the lower, it's absolutely critical to optimize your cost reporting. If you're in that if you're in that middle area, you know, you wanna make sure that you're getting positive outcomes and and capture of those things. There are many, many hospitals I've talked to that live or die on dish, in terms of making sure that that reporting is there.
Most of the hospitals that Amber and I talked to are getting some proportion of the Medicare beneficiary bad debt, but there's always opportunity to get at that as they move forward.
Moody's put together this median hospital metrics slide, which I love, talks about key financial metrics.
Cash, obviously, bled out a little bit during the wake of COVID in twenty two and twenty three. I think we're gonna see that come back up to the two hundred, two hundred fifteen, two hundred and twenty range in twenty four and twenty five. Cash to debt ratios, operating margin, as I mentioned, operating cash flow, and and debt to cash are all greatly improving as we move forward.
We're seeing a general stabilization in the market, which is good. So hospitals are gonna move from kind of the sustainment to growth. And when you're doing that, it's it's it's tremendously important to optimize your cost reporting strategy, and we'll talk about that today. Another look here from from, S and P.
Days cash, margins are one point one here. As you saw from Kaufman Hall, that index is running around four. You'll see some things from Fitch here in a minute that are predicting probably around six percent. Which I think would be awesome and most of us would love to get to that level. As I mentioned, this the the the market is really stabilized. We're seeing labor expense continue, to, let level out as you saw from that outlook report.
Balance sheets are benefiting from that. Forecast meeting operating margins between one and two percent barring any issues to the system. This came from their Outlook report. They did couch a little bit of these forecasts surrounding the administration.
Fifth round will be putting on some legislative updates this year. I'll get with Becky if we feel like that's worthy of doing a a webinar back out to you all. Please comment in the in the comments and things if you feel you'd like to hear that, but I do want for our business. I've I've done it for organizations like HFMA and KHAM and AHAM and others to talk through what we think that economic impact of the Trump administration, Doge, doctor Oz, Elon Musk, and the other folks that have been headed up with the cabinet, the health committee, the ways and means committees, what we think might happen to Medicare going forward in terms of of, reform and, some level of defunding as well.
S and P looked at the hospital outlook, and as I mentioned, they raised that from negative to stable. They they kinda highlighted this area of cash flow and capital and the ability of organizations to capitalize, for lack of a better word, on that cash position and really look at the reserves. Health policy is certainly coming. We're gonna look at that and see how that looks as we move forward.
Payers, they remain difficult. Now S and P said that they're seeing favorable contracts occur. I I gotta go research that because last I checked, payers are pulling pretty hard ball. They they are denying a lot of things.
They are, especially on the commercial side. Medicare Advantage has a multiple of denials over traditional Medicare. We'll talk through that here in a minute as well. And as I mentioned, those underpayments are occurring.
Unexpected challenges, I I I think, you know, you're gonna see more cybersecurity investment, happening. Finthrive is investing a lot there. You're gonna see plant and investment growth. I think m and a activity is gonna probably prosper a little bit as we move forward into twenty twenty five as the legislation changes.

Some of that oversight might be lightened up as we move.
Moody's looked at this as well. They said that the labor and cost inflation to put that's played hospitals as levels out. Supply costs, unfortunately, for the wage index and some of the some of the inflationary things that have occurred are gonna stay where they're at, but that still is being overshadowed, I would argue, outpaced by the strong operating cash flow that we've seen. Moody's is much more favorable than Fitch here saying that the of their block, they expect margin improvement seven percent as a one percent percentage increase over last year, which I think is great.
They expect growth as hospitals increase their cash flow. Sixty percent of hospitals are expected to have a six percent or more margin. That's way inflated from the other, areas I've seen, but I think that's positive news for the market. They expect, as I mentioned, higher reimbursement from the commercial insurers as well, and they expect some investment cybersecurity to make sure that hospitals are staying resilient, have redundant processes in place, and are looking to make sure that they're protected, from operational things.
Moody's also had this in their comments, so I thought it was great. They talked about strategic alliances with companies that specialize in revenue cycle, and that's certainly FinThrive for that matter and and really wanna drive down their cost, maximize their yield, allowing them to approach this financial stability, which I think is super important as you're looking at your cost reporting strategy.

Transitioning CFO Roles and Responsibilities
We're gonna dive in now to kind of specifically Medicare and and and cost report elements. Now that I've given you kind of a market update, which is mostly positive. I actually was pleased to put those slides together and kind of pass along that information. We're we're seeing generally at FinThrive in the base.
We're installed in roughly two thirds of the market in terms of hospitals. CFOs we're talking about are fairly aligned on these four elements. Every time we're interacting with the c suite or with stakeholders as an organization, FinThrive has this conversation that hits these pillars of what are your missions and goals? What challenges are you seeing?
What strategic objectives do you have this year? And how can we help you get there? And what business priorities do you have? And are there things in our playbook, in our wheelhouse that we can effectuate positive financial change for your organization in terms of what we're doing?
I'm seeing the CFO role significantly transition from transition and accounting to more of a strategic type role. More hands on the operations, understanding some of the things Amber's gonna talk about in terms of what needs to happen strategically to maximize yield specifically as it relates to the cost report.
Something we also see when we're talking to our customers is really this financial blame that's occurring. And we see, as I mentioned, that bear kinda coming out of hibernation and us looking at, opportunities is well, revenue cycle captures that we don't. We kinda have to report based off what the documentation is and billing. And then the revenue cycle will go, well, hey. I'm not involved in the cost report. We're just basically admitting patients to the hospital, scheduling them, doing financial clearance, and they don't understand the value of the audit necessarily. And I would argue they're not staff board either.
Most revenue cycles even mine will staff to keep the lights on. We were there to turn and burn patients, admit, register, schedule, answer the phone, submit claims, and when anything else kinda happened, we have to take someone off of that. We did not have flex staffing available for us to go help the accounting department or the controller figure out what needs to be reported. Typically, a request came in, we turn that report around and we move.
When the auditors were on-site, there was typically something that happened with the CFO. And so this blame game happens. It's not bad. I just think it's different priorities, different incentives, those types of things.
Oops. Hang on. I'm stuck. There we go. So this results of this poor communication. And I think disaligned incentives and and really this lack of teamwork sometimes because there's often this abyss, I would say, this invisible Chinese firewall, if you will, between the business office and the treasury department.
The CFO has to look at that very closely from an org chart standpoint, operationally and strategically. Looking at the business office and the finance department as one. Making sure that director of billing is talking to the director of reimbursement.
And they're understanding how reporting of Medicare beneficiary bad debt impacts the cost report. And how that ATB needs to accurately reflect co pay, coinsurance, and deductible dollars in the right way as those reimbursements come in. So we're gonna understand that dunning cycle, how those letters go out the door so that on audit that could be defended. Right? And that makes it challenging without software, I would argue, or technology is very difficult to make sure that those bad debt logs, those dish logs, all of those things are at a level. When we go into hospitals, and Amber will be able to amplify this more than I can, we often find a delta between what they're finding and what we found and we get them there through our solutions.
Achieving best practice absolutely requires collaboration across these two entities.
Between the finance and the business office, we need to be able to get the best practices.
The data needs to be agreed upon. Those logs need to be accurate, timely, and completed in a manner that'll be defended upon audit. We're very proud at Finthrive of our defendability.
We've done a very good job there and Amber could share some details in that area.

The Complexity of Cost Reporting
I'm gonna turn it over to Amber now into this cost reporting puzzle, I think. Alright. Yeah. And she's gonna talk through, what we're gonna what what things we are doing at Finthrive and how we're making a difference with our customers, I give you the illustrious Amber Baker.
Thank you, Jonathan.
Yeah.
You know, we are seeing more and more of this this charity puzzle, and and it's literally looks like like the screen, a bunch of different puzzle pieces. And and it's not a one size fits all and cookie cutter for reimbursement for each hospital. You have, so many different variables that are in play, whether that's, hospital rules, hospital policies that are changing, state specific policies that are changing, areas where you used to be able to access data, you can't access those data sets anymore. Or, Jonathan's been with the hospital for thirty years and his travel knowledge is all in his head. And now you're starting to see more and more of that population actually, look at a retirement plan and there's no contingency there on bringing in some of the younger generation and getting them trained up.
It's hard.
The puzzle of hospital reimbursement in general is hard. And then you throw in the government, and it just completely complicates everything, you know, that much more. And so, really, when you're looking at, you know, how do we do this going forward, you have to be able to figure out how to put those puzzle pieces together, and you have to be able to do that outside of the box. And and sometimes that is having some internal folks that can put parts of the pieces together, using technology that can help with other pieces of that puzzle. And then in a lot of cases, it's the combination of the two that really complement each other.
But it is definitely, you have to be able to work together, whether that's your internal staff, your internal staff with vendors.
It it all has to be a partnership. And for all of your puzzle pieces to lay right together, there has to be that open line of communication.

Strategic Planning in Healthcare Finance
I was at a HFMA conference, not long ago, and and Jonathan hit on, you know, a lot of the CFOs and and what they were looking at. And we were listening to a panel discussion, and, they mentioned, you know, in today's health care environment, they've gone from even just having a five year plan to looking at very strategic and deliberate, two to three year plans that are are bringing in the quickest cash for their health organization, helping sustain the liquidity liquidity and then doing what's right for, the hospital's financial health. And it can't be just the same old process and routine that they they have done historically. So, you know, when we start looking at at government reimbursements again, they're the concept has stayed pretty well the same. The transfers and the the shadow billing and the IME, those have been consistent for, you know, transfer DRGs. We've been in the space for fifteen plus years.
IME and the shadow billing came into play in two thousand nine. So these are not new issues.
But in order for the hospitals to see a change and to be able to increase those dollars, we have to start doing something different.
And again, a lot of that is, technology based.

Technology's Role in Revenue Opportunities
So when we start looking at, at a lot of the technology that is here, then we start looking at, when we're looking at revenue opportunities and cost reporting opportunities, where do those areas overlap? How can that, help increase the revenue? And then what does the timing of the payments on those look like?
So we'll start, really on that revenue opportunity, side. It's a little less complicated when you you look at the transfer rules and and the IME.
Really, what hospitals need most there is is the technology support.
What data do they have access to that's going to be outside of of what's just within their patient accounting system. That's really where partnering with a vendor who is keeping up with those regulations as they change, for the transfer DRGs, where are the rack audits going on? What are the auditors specifically looking for? Where can we dive deeper into those different areas?
That's probably going to be your, I like to say your fastest cash. If you're looking to to clean up some of those processes, look at your data, have an influx of of cash. Typically, when we're completing these projects, we would normally see an an influx within ninety to a hundred and twenty days, with that that quick cash win. But then how do we figure out how to make that streamline going forward? So you're not you're not on this constant, roller coaster of give me an influx, let's drop it back down. Let's get another influx.

In-House vs. Vendor Cost Reporting
Same thing happens with the cost reporting opportunities.
A lot of providers complete this work in house because they they wanna do some cost savings there, as far as putting together the cost reports.
And then they'll just say, you know, we'll have another vendor come in and, you know, do this, do a secondary run that safety net approach, you know, further down the road. And really what what happens there and and why it's so important for hospitals really, to focus that is you're shifting your timing of your payment. So, the more you can capture right up front in your your areas, your revenue cycle is working together with your reimbursement teams as far as data and what opportunities are there and what can be supported.
You're typically gonna see those payments within a sixty to to ninety ish day window on a tentative settlement.
And then if you have that secondary vendor coming in and and looking at your data again, you're gonna shift that payment out, to probably two to five years versus that sixty to ninety day window. So as those CFOs are looking for how do we help with, you know, the financial aspects of our health system, that's probably, I I would say, one of the easiest, adjustments there and and really looking at your your data. So when most of these hospitals are completing this work in house. They only have access to the data that, is within their patient accounting system. They're not always looking at a holistic approach of where else can we find revenue. So, normally, when you're working with a a vendor that has more technology support, whether that's in a a services model or, like like what Finthrive does, having an actual techno a SaaS platform technology.

Data Integration for Improved Revenue Cycle
We want to, streamline those datasets and say, okay. If you're going to put in the work and you're gonna get us the data, we're gonna give you as much information out of that data that we can. But we're not only looking at your hospital data, we're actually looking at those true source files. So we're getting data from Medicare, from Medicaid, from your collection agencies.
We're running eligibility, and then we're taking all of those disparate datasets, and we're putting it together in in one single location where you really have that dashboard, dashboard, and you're you're getting the lift out there.
And I mentioned earlier, you know, you you have multiple opportunities of, you know, how we can deliver the information back to you.
And so there is a strategy there.
Jonathan, if you'll go to the next slide for me.
When you're you're looking at how do we consume this data, how do we intake the data, how do we use the data. Again, a lot of the the legacy workers or the the older workers that have that tribal knowledge are are getting ready to retire. So then you start looking at succession planning and, you know, you really have to sit down and think if we're going to maximize our reimbursement and help fill those gaps, what does that look like specifically for us? We've had hospitals where that gap is we don't have a succession plan. We need boots on the ground. We need somebody that has the knowledge. We need somebody that can do the work for us.
Other facilities that we've worked with, they have started a succession plan. So they're transferring that knowledge or, in a lot of cases, we've actually had a lot of auditors come over, you know, from the from the dark side, if you will, over to the hospital side. So they have the knowledge.
They just need that technology support. So, when you're looking at that from a holistic view, you know, a lot of that is, something to take into consideration when you're thinking about your next steps.
Jonathan hit earlier too on, we were looking at some of the cost reporting data and visibility that we have.

Shifts in Medicare Demographics
A big topic that has come up lately, and it's really been within the last three or four years. We've seen it more and more, but we're seeing that shift from your traditional Medicare beneficiaries that are driving, all of your your reimbursement there from a bad debt perspective.
We are seeing some of the Medicare Advantage population where the demographics are almost fifty fifty with your traditional Medicare population and and your Medicare Advantage population. So in some cases, and you really wanna to make sure you, work with somebody that has that knowledge and and review some of your contract language. But, in some of those cases, the areas like transferred ERGs and bad debt, you can still recoup those dollars. So, you know, and I know people that have been very set in their ways.
Bad debt is only tied to Medicare. We can only file our Medicare bad debt with a cost report.
Based on your sample your your language within your contracts and your negotiated rates, there can be opportunity to take that same process and compile bad debt listings and submit those directly to the Medicare Advantage Plans who state within their contracts that they will pay similar to Medicare.
That is something again that that, we do a lot. We're we're happy to help review contracts. If you have questions, feel free to to reach out to Jonathan or I, and we can we can help you guys with that.

Collaborative Approaches to Reimbursement
And then also, you know, as you're working with a vendor, you wanna make sure not only are we pointing out the things, that are are going wrong, but but how do we fix it? So if you have a puzzle piece that's off, how do we lay out all those puzzle pieces for you? So, you know, your your reimbursement is there, you're solid, you know, the direction that you're going. So when you're looking at, your reimbursement as a whole across the board, you wanna make sure that you have somebody that is giving you that dashboard, or those analytics, in that that view of your data.
So it's not just, again, what you can see within your hospital data, but it's globally across the board, what we can see, using all of those source data. So when you have a reimbursement person come into revenue cycle saying, this is wrong. This is wrong. This was wrong.
We got hit at audit. We wanna change that perspective where it's not the back and forth finger pointing, but it is that collaborative approach, and we can actually quantify for you, hey. Based on the data, this is what it tells us. We have a hospital that we worked with, in the northeast who said, you know, our revenue cycle, folks made a decision that they weren't going to bill some of the, the psych Medicaid secondary patients because they did not feel like their the juice was worth the squeeze.
They weren't gonna get back anything that was substantial.
They were already, you know, overworked, didn't have the bandwidth to pick those up. Not a big deal. Medicaid's not gonna pay. So we did an analysis of the data. Again, using the source data from Medicare and Medicaid, we were actually able to present back to them a story that just based on those crossover patients that were traditional Medicare primary and Medicaid secondary, they were leaving a quarter of a million dollars on the table by not billing those Medicaid, patients. So it's so important to to use that full set of data and have that overarching holistic view, where we can improve it. But, again, if you're gonna ask somebody to make a change, you have to be able to quantify that for them.

Yearly Trends and Payment Timings
And then also looking at, you know, your year over year trending. And and I mentioned earlier the roller coaster of of payment timings. And if you're missing something, then you have to go back in and clean it up, and then, you know, you drop back down. And and what we wanna do is make sure that you're staying at a steady state.
So we we look at cost reporting data on a quarterly basis. It does break down the three buckets of bad debt, within our our projects there. And even in the cost reporting information, we can see it separately, your crossovers versus your self pay and your your charity. So we really know as we're looking at that delta, we know where the issues typically reside. And then out of that dashboard or those analytics that we showed earlier, we can really show you what was missed. Again, quantify the value of that, and then make suggestions on how to fix it. So we're not just going in and pointing fingers or telling you you did something wrong, but really from a a partner standpoint, how do we make sure that that subset of of population that you're missing, granted you cleaned it up and you're gonna get, money two to five years down the road, how do we get that current today where you can get your payment in sixty to ninety days versus waiting that two to five years for it?

Performance Reviews and Revenue Adjustments
And I would say that's really, you know, from an an annual standpoint, you wanna see that you're you're good, Jonathan.
You wanna see that how you're missed. But then also, this is just an example of some of our performance, reviews, for the the revenue opportunity. So the transfer DRG and the IME.
Same thing here. You wanna see you wanna point out what the team is doing good, as they are seeing they're they're making adjustments to their process. They wanna be able to track that and say, we've put in the work.
We made this this small change that we thought wasn't gonna have an impact, but it has completely shifted, our revenue or we have gone from q one to q two. We have almost tripled, our revenue based on a small, you know, insight of information that we received and a and a change to our process.
And then just making sure things aren't getting lost in that black hole.
So with the transfer DRG and the IME, you get to see more of a a real time feature because you can access some of that information.
There's not quite as many moving parts as having to go through Medicare payment and then a a Medicaid payment or a self pay process.
It's more real time, if you will.
So making sure that none of that opportunity, again, is getting lost in that black hole.
You're getting paid timely.
Any of the accounts that are returning, to the provider. Again, another learning opportunity. If we we start to see trends where a certain rejection code is consistently being hit and returned, those are the things that that a hospital needs to see. And then you're moving more to a proactive approach in your revenue versus constantly being in a reactive, reactive mode there.
And then also, you know, when you're you're working with a partner, you wanna make sure not only are you keeping up with, you know, just policies, regulations.
I mentioned it earlier.

Navigating Regulatory Changes in Healthcare
Not everybody is cookie cutter. So you have some health systems that you see now are are starting to acquire facilities in different states.
So you're gonna have different state rules. You're gonna have CMS changing formats on on how your, detail has to be provided.
Some of this information comes may come from a legacy system. So as you're having system conversions, you're acquiring hospitals from different states, different patient accounting systems.
How do you get all of that information down into, that single data warehouse where you can pull the supporting documentation that CMS is gonna require and make sure that you're filling in, as much of this information to not have the red flags when it comes time for audit.
So, obviously, you have the the new bad debt listings.
We have new dish listings.
You know, we have a team that that keeps up with that. That is all they do. They're monitoring those those regulations and and seeing if there's a change. How do we get with our product team to make sure that that is, constantly staying, caught up where, you know, some hospitals, if you're already short on bandwidth, that that's hard to keep up with and develop.
So This slide talks about HFMA really pointing out what Amber's saying in terms of how you can get kind of part of the way there versus, you know, all the way there with technology.
And, this isn't me or Amber. This is HFMA. I'm a a a big believer in HFMA. I I'm gonna be out at Western Region next week, in Las Vegas with region ten and eleven, and, I'm a region exec for region ten.

The Importance of Technology in Financial Performance
And, I spend probably a third of my career in HFMA events. Amber and I, as we mentioned, we were out at region nine out in the south, which is a heavily Medicare, Medicaid population looking at what they're doing. And they really talk about just this this kinda lackluster performance that's happening with bad debt, uncompensated care, dish, and just having that lack of technology there leaves ten percent more in losses, which we just talked about margins and how razor thin those are. And I think everyone, as Amber said, is doing the best they can, but we really are a good to great organization.
We wanna automate and really get at some of those areas where we can make things better as we move forward.
This is a case study here. I'll let Amber kinda give some of the details as well. But one point nine million dollars we found above and beyond what they normally had found when they were looking at it.
And, Amber, I don't know if you have things to add on this, but this was a great study from one of our customers.
Yeah. And I think really, this is where where you get into using the source data, and just being able to have that visibility using the disparate datasets that most hospitals just aren't set up to, you know, consume that amount of data, and then know what to do with it. And so, again, you're getting into different areas of the of the hospital organization working together. So now you're starting to bring in IT as well.

Collaboration Across Departments
If you're gonna have to have support on how to build something out, you know, you're gonna have to have somebody from reimbursement given feedback and somebody from revenue cycle that's given feedback and then hope it's not lost in the mix with your your IT person who is in SQL or, you know, in their IT land, and language, trying to to interpret what you're you're trying to accomplish from a finance standpoint.
We have time and time again, we continue to see, you know, missed opportunity and most of it is data driven.
It's the lack of visibility into your data until it is too late. And then it's it's a very, again, turf war back and forth. Well, they did this wrong. No. We did this right. You're reading you're interpreting the data wrong.
So somebody that can come in and help be a stop gap and and fill in some of that, you know, data support that have a knowledge support. So you have a sounding board, from a, you know, an outside source where you can say, hey. This scenario was going on. I need your unbiased opinion.

Market Comparisons and Delivery Models
How are how are other health systems in the market handling this? What are other hospitals within our specific region doing, to take care of these issues? And then again, you know, I I mentioned earlier your delivery model. And so something that that Finthrive is very proud of is we we meet providers where they are.
So we have, you know, we invest a lot in the technology, but also within the people. So, as we're looking at, you know, delivery models for providers, you have the option. If you don't have the knowledge base there, full consulting outsourced, you know, turnkey model, send us your data. We'll analyze it. We look at it from the perspective of an auditor, so things that we wanna make sure are going to to pass audit.
Typically, even running behind in a in a safety net position behind some of the other vendors, on average, we still find, about a thirty percent increase, to your revenue. So it's always good, and and we have people that run as a safety net behind us. It's just it's it's good. You can never in my opinion, you can never have too many sets of eyes. So, even if you have a a primary vendor in play, we're happy to to help just be that safety net set of eyes.

Long-term Planning for Providers
As you have a a you're looking at that two, three, five year plan.
If you want to groom up your internal people, you have the knowledge base and you want the technology.
We're we're one of the, few, vendors that actually offer not only from a full consulting model, but we we allow our our provider partners to actually log in to our technology and utilize the same SaaS platform that we do. So, we have had some providers who, you know, they have started out in that full consulting model. Their their two to five year plan is we wanna move into that SaaS space.
They move in. They try it. They don't like it. They wanna go back to the outsourcing model.
Totally okay. I I think that's really where you get into that.
You find a partner that that works with you, and has that flexibility, to kinda be able to to go with the win for whatever scenario you're facing today as a hospital, whether that's bandwidth, knowledge.

Complexities of Cost Reporting
You just have so much on your your plate. You know? The cost report is thousands of inputs, thousands of inputs.
And when you start looking at at bad debt dish and s ten, those are the the three areas out of those thousands of inputs that require patient level detail.
So we have had some of our providers, who have said, you know, they had the knowledge, they needed the technology.
They have gone from, you know, when you're in your five month cost reporting window where four and a half months of that, they were heads down in nothing but the bad debt in the dish listings from sunup to sundown, be able to take that analytics dashboard and and take that four and a half months of crazy chaos and consolidate that down to two or three weeks. And then they're able to, focus on other revenue generating projects or learn different areas of the cost report where they can help support other areas, or just the whole financial health as a as a hospital overall and also keep their sanity while they're they're in that cost report mode.

Leveraging Data for Revenue Maximization
And then looking at the synergies, you know, we talked earlier in the beginning using the datasets, being able to take the enormous amounts of data that we have and and provide back to providers, the most revenue that can come out of that that single streamline dataset.
And, really, in my opinion, and probably because I've sat on the back end, more so, but when when we look through these analytics dashboards, a lot of the areas where hospitals are providing are crossover bad debts. Medicaid is not being billed timely. Those accounts are are going non timely before the bills go out the door. When you're looking at an end to end platform, you can start really filling in those gaps earlier in the process. So, for example, the insurance discover looking at some of that real time eligibility and making sure you have the coverage, correct when a patient enters the door, before their service, whatever the case is, that that patient has to be billed to Medicaid. So now not only are you potentially increasing your revenue earlier in the year, but that trickle down effect of your cost report is you're gonna see less issues at audit because your your timing of bills getting out the door are going to be more accurate.

Improving Billing Efficiency
Your billing, your statements that are going out, your charity process, all the things, just tend to go just tend to go a whole lot smoother when you you find those holes earlier on.
And we did do, this this is an actual case study, where we had taken a a facility, a partner where we were looking specifically at their, Medicaid population. So with the crossover bad debts, cleaning up some of those accounts that, that were not billed timely, and then also making sure we found all of their eligibility, whether that's in state, out of state, traditional plans, managed plans.
And we were able to increase their revenue by a quarter of a million dollars a year using the same datasets. So there was very minimal lift, from a a data's standpoint, it was a communication issue that needed to happen. So, again, that just making sure that that communication is there, between departments, but then also, the visibility.

Adapting to Change in Revenue Processes
If something's gonna change, then then we have to change our the the whole process.
We can't stay standard quo and expect the revenue to increase there.
Thank you, Amber. Yeah. I think, you know, double clicking on some of those case studies there at the end, and you guys will get this deck. We'll have it for you.
We're happy to provide those case studies from Amber as well as is, you know, when I was a chief revenue officer, I think the last thing any of us wanted was a distraction from another vendor coming in and and and and making things more complicated. Cost report strategies, as Amber said, are pretty traditional. I would argue they're probably pretty mature and known. If you look at those case studies, you know, you're you're seeing a a thirty percent delta from what the existing processes are getting out of Medicare beneficiary bad debt.
You're seeing a fifteen percent lift on some of the things that are being found on DISH or the three forty b or other areas. And and it's a dataset that could be leveraged that really is just incrementally delivering a higher level of cash based off of the market that you're in now. And with the shifting strategy of the CFO really being operationally proficient, not only financially proficient, and and I would argue compliance risk too. Double clicking on that, you saw those numbers.

Audit Preparedness and Defense
High ninety percent defense rate, you know, where an auditor comes in. We're defending what we found as a partner at the elbow with you in terms of what types of reporting and documentation that needed to occur to get to that incremental revenue. Like I mentioned at the beginning, CMS doesn't pick up the phone and say, hey. We shorted you.
We're gonna give you some money. You've gotta refile. Whenever you refile, that raises a flag that causes audit risk to come to you. We wanna we know that.
We prepare for that, and we have our homework ready. Once there, everybody's aligned, and the expertise is there, and we can really drive those efficiencies and revenue. Amber, you did beautifully as I knew you would. We're gonna open it up for q and a now.
I think we've got about ten minutes, Becky. I don't see anything in the q and a.
I might ask Amber some questions if we don't have any from the thing because, I know she's, she's good at everything, but she's probably better at fielding questions and presenting slides. So I'll I'll throw her some curve balls here in a minute if we don't have anything.
Amber, where do you see, like, folks finding the most opportunity would be one of the questions I have for you. So, like, when you're on-site with a customer, where do you see the conversation kind of hinging or focusing on the most? You're on you're on-site today, for example. What types of things did you talk about today?

Utilizing Existing Data
Actually, the whole gist of the the conversation today was utilizing the the same data, that we have.
In this scenario, in today's case, it was, a provider was, was it it's looking like they're going to potentially lose their three forty b, which is a a multimillion dollar issue for them.
And so it is figuring out what rocks can we overturn.
Is there anything else that we could do that we haven't done?
And in this case, it was when we we work with them to help prepare their their dish listing, they actually utilize the software. So we run eligibility. We rerun eligibility, where we have direct connections with the states.
The the conversation actually shifted though to you guys are also an insurance Discover client. So to make sure we're turning over every rock, because our insurance Discover platform, we're connected to eight hundred and eighty payers. That's a lot of opportunity when you're starting to look at at the population.

Let's take the eligibility that we got back directly from the state and compare that over to that insurance discovered just so we can say no rock was unturned.
We are we are literally looking at hospital data, state data, eight thirty five information, eligibility information, and and trying to do everything that we can, to help those providers. But it then you get into, you know, the communication between the two teams because today is we met with with the reimbursement folks. And, you know, some of that support on the insurance Discover side comes from the revenue cycle people.
They're having to to go to revenue cycle for some audits that they're currently on.
And one of those one of those audit issues was, did the the hospital write off to charity too quickly?

Innovative Solutions for Audit Challenges
Again, that's where you can go back into that insurance discover, and work with your revenue cycle team and just really think outside of the box.
How do we use the information that we have to best support the provider when the audit is just they're just nitpicking every every little detail.
That's great.
And I don't see any other questions. As Becky mentioned, there's a QR code there. Amber and I's emails are here as well. We'd love absolutely adore getting questions from our customers or folks that are interested about this as as dry as cost report is.
Amber and I love talking about it, and we love talking about government reimbursement. And most importantly, we love delivering cash where it's due here and understanding how we can help you get there. Amber, thank you so much. Becky, thanks for hosting us.
Thank you. Thank you all for being on the phone today. If you have any questions whatsoever, feel free to zip us an email, and there's a QR code there. And Becky will turn it back to you, and thank you so much.
Awesome. Thank you, Jonathan and Amber. That was a wonderful presentation.
And thank you all for joining us today. Thank you all again and have a great remainder of your day. Take care.