The Challenge
A hospital located in the Northwest United States had suffered financial losses for the previous four years. Located in a region where it has the predominant market share, this hospital had expenses that seemed unreasonable for its patient volume. The Board of Directors had a turnover of the CEO and CFO, and was searching for a solution to the perceived operational deficiencies.

SHP Approach
Spectrum Health Partners (SHP) was asked to evaluate the operations of the hospital. The overview included a study of the Revenue Cycle and a review of the Charge Master with a focus on capturing charges. Additionally, SHP evaluated purchasing of supplies, physician contractual arrangements, employee salary levels, and services offered that might not be contributing to the financial well-being of the hospital. The services were evaluated in context of revenue generation, cost and contribution to the mission of the hospital.

SHP utilized Benchmark data from similar hospitals and reconstructed the hospital within the best practices parameters. Findings showed a lack of conformance with purchasing group protocols, unrealistic physician contractual arrangements and certain services that were either not performing to expectations or lacked administrative guidance.

SHP Solutions
SHP assisted the Board in the selection of the new CEO and CFO and mentored both for a period of time. Additionally, the Board was informed of ways that non-performing services could be enhanced and made profitable. A new purchasing group was recommended and physician contracts were restructured. SHP also suggested options for enhancement of the lacking collection process.

The Board asked SHP to continue monitoring the performance of the hospital for a period of 6 months after which it was determined that the new CEO and CFO could operate effectively. The new purchasing group added additional savings and the revenue cycle enhancement produced revenue that previously was lost. The physician contract process restructuring was begun, but was deemed to be a longer term project.

The Results
All of SHP's recommendations were followed and a structured guide was developed. The new CEO and CFO are currently performing extremely well and the hospital is in the process of seeking financing for construction of a replacement facility. The market share was recaptured and operational expediencies were added. The hospital is currently financially stable and is positioned to build the replacement facility.