View
3
Download
0
Category
Preview:
Citation preview
Rhonda C. Anderson
Senior Vice President and Chief Financial Officer
Ascension Healthcare
November 9, 2016
Running 129 Hospitals: Financial
Management Insights from the
Nation’s Largest Nonprofit Health
System
Agenda
2
• Ascension Overview
• Journey to One Ascension
• Managing Key Revenues and Costs
• Continuing the Journey
Ascension Overview
FINANCIAL AND STATISTICAL INFORMATION (Fiscal Year To Date June 30, 2016)
Total Assets $32.5 Billion
Total Operating Revenue $21.9 Billion
*Income from Recurring Ops $981.0 Million
Net Income $477.7 Million
Care of
persons living
in poverty and
community
benefit
programs:
*
4* Includes Self Insurance Trust Fund (SITF) Investment Performance
Total Admissions 777,593
Equivalent Discharges 1,597,177
Physician and Clinic Visits 12,687,354
FTEs 120,798
$1.8
BILLION
ASCENSION HEALTHCARE AND SOLUTIONS
5
Ascension
Healthcare Division
Ministry Markets
Ascension Senior Living
Ascension Medical Group
Ascension Community
Clinics
Ascension Clinical
Holdings
Ascension At Home
Solutions Division
Ascension Information
Services
AscensionMinistry
Service Center
Ascension Care
Management
Ascension Investment
Management
Ascension Global Mission
Ascension Ventures
Ascension Holdings
Ascension LeaderInstitute
Ascension SmartHealth
Solutions
OUR CARE DELIVERY SYSTEM
6 6
Ascension is the largest Catholic health system, the largest private nonprofit system
and the second largest system (based on revenues) in the United States, operating
in 23 states and the District of Columbia.
Grand Cayman
6
Hospital Operations Continuum of Care
Discharges 777,593
Total Owned Beds 22,990
Acute Care Hospitals 112
Rehabilitation Hospitals 6
Psychiatric Hospitals 9
L/T Acute Care Hospitals 2
Total 129
Joint Venture Hospitals
(<50% Ownership)13
Outpatient Visits 27 million
Ambulatory Surgery Centers 66
Occupational Health Programs 55
On-site Employer Clinics 76
Free-standing Imaging Sites 110
Retail Pharmacy sites 45
Sleep Centers 31
Virtual Care Programs 70
Mobile Clinical Services 26
Specialty Clinics 613
Retail Lab Collection Sites 155
Community & Social Programs 157
Primary Care Clinics 565
Other Miscellaneous Services 155
Sites of Care by Business Segments
7
Health Plans & Risk Bearing
Home Health
Sites of Care by Business Segment
8
* Includes facilities part of a CCRC
Visits 505,361
Durable
Medical Equip15
Home Health
Services42
Hospice
Services16
Outpatient
Rehab
Centers
148
Covered
Lives2.6 Million
Health &
Medical
Insurance
Plans
7
Other risk
bearing
activities /
programs
26
Physician Enterprise
Beds
L/T Care/Skilled
Nursing* 22 2,780
Independent/
Assisted Living* 17 1,768
Other Living
(HUD, Other)2 108
PACE program
Enrollees 3 514
Senior Care
Visits13.1
Million
Primary Care
Clinics565
Employed
Physicians6,500
Aligned
Physicians~45,000
Journey to One Ascension
Delivery Macrostructure
Delivery supported by Ministry-Wide Functions (HR, Finance, Mission Integration, Communications,
Legal, Clinical) and Solutions (e.g., Resource Group, Analytics Group)
Work together to realize benefits from scale and standardization
Work together to
realize market
strategies and
integrate care
with the benefit of
scale, expertise,
and experience
from specialized
units
DELIVERY-WIDE CLINICAL
SERVICE UNITS
Ascension At Home
Ascension Medical
Group
Responsible for strategy and clinical, operational,
and financial performance within Ascension
standards
Responsible for strategy and operations
across markets
Individual market
DELIVERY-WIDE SUPPORT UNITS
Responsible for optimizing clinical and operational performance through consolidation and standardization
Physician
ServicesCare Excellence Operations Services
Payer & Network
Contracting Services
INDIVIDUAL MARKETS
Ascension Senior Living
10
MINISTRY-WIDE FUNCTIONS
Enhancing Capabilities and Expertise Across Ascension
11
DELIVERY SOLUTIONS
Clinical
Communications
Finance
Human Resources
Legal
Mission Integration
Advocacy
StrategyIncreased standardization,
collaboration and the level of
expertise across Ascension
Value Generation for MWF
Actual FY16
$20 – 25
million Projected
FY17
$35 – 40
millionFY18 – FY20
$55 – 65
million
12
Finance – Centers of Expertise
DELIVERY SOLUTIONS
Clinical
Communications
Finance
Human Resources
Legal
Mission Integration
Advocacy
Strategy
General Accounting
Net Revenue Management
Payor Contracting
Tax Reporting
13
The Finance community will serve as a collaborative, trusted, strategic
business partner, promoting stewardship, highly efficient financial
operations, and contributing to effective decision-making to ensure
operational success
Serve as a strategic business partner to all leaders within Ascension
Employ deep financial expertise to deliver service-oriented, highly
responsive results
Anticipate and address financial, strategic and operational issues and
opportunities
Maintain a strong internal control environment
Provide a single, reliable source of financial data and analytics
Achieve efficiency in structure and service
Ensure that decisions and services are mission-focused
Share information transparently
Ensure high quality investor and banking relationships
New Governance Structure
• Consolidation of Finance and Audit Committees into one
Finance Committee
• Standard Finance Committee Charter for each Ministry
Market
• Monitors the financial performance of the Health Ministry
Market (focus on P&L); Balance Sheets monitored at
System level
• Audit scope decisions made at System level
• Financial Integrity responsibilities remain with local
Finance Committee
• Goals, including performance compensation, set at the
System level; local boards monitor and provide oversight on
System wide goals
Ascension Health Ministry
Accountabilities
Debt issuance & leasing
Investment management
Capital allocation
Budget reviews and approval
Track performance and
operational improvement
initiatives
Monitor financial integrity
compliance
Manage quarterly and annual
audits
Operational strategies
Capital project analyses
Budget reviews and approval
Track performance and
operational improvement
initiatives
Physician integration
Develops short term and long-
term financial plans
Financial integrity
• Economies of Scale
• Consistent policies and procedures
• Clean audit reports
General Accounting
• Improved reimbursement yield
• Leveraged deep internal expertise
• National advocacy
Net Revenue Management
• Improved reimbursement yield
• Leveraged deep internal expertise
• Centralized tools for risk based contracts
Payor Contracting
• Leveraged expertise – reduced reliance on outside resources
• Reduced risk with consistent compliance
• Consistent approach to tax planning
Tax
16
Service Level Commitments
Managing Key Revenues and Cost
Challenges in FY16
Aggressive Competition
Investment
Market
Revenue Cycle
18
Common Tools
19
Oracle's PeopleSoft - leverages best practices to achieve world-
class finance processes, and efficiently delivers greater visibility into
business-critical information.
Kaufman Hall Axiom Healthcare Suite – solutions for budgeting &
forecasting, long-range planning, capital planning & management,
and performance reporting.
Kronos - helps manage all aspects of the employee lifecycle.
Kronos workforce management solutions is used to monitor and
impact workforce efficiency in consistent and well-organized manner.
Crowe Revenue Cycle Analytics - provides the single source of
truth for net revenue.
Hyperion Financial Management - a comprehensive, Web-based
application that delivers global financial consolidation, reporting and
analysis
One of the largest healthcare information technology (IT) service organizations in
North America with annual operating expenses in excess of $1 billion and an
annual capital budget in excess of $250 million.
20
Enhanced usage of IT
operational metrics through its
Technology Business
Management (TBM) function
and its IT Balanced Scorecard
Utilization of cutting-edge
technology and processes to
protect Ascension’s IT assets and
data
Continuous focus on cost-reduction
opportunities, driving an average of
$41.4m of cost reductions for each
of the past 5 years
Supporting changes in Ascension’s
care delivery model by enabling
infrastructure for data management
and advanced analytics Supporting clinical
standardization through
deployment of standard IT
systems and workflow process
in inpatient and ambulatory
care settings
AIS drives value to Ascension by
Ascension Information Services
21
Ascension Information Services
Overall AIS has achieved an average of $41.4m of cost reductions for each of the past
5 years. Without IT cost reduction initiatives, growth would have been 9.3% on average, compared to 4.0% average growth with these initiatives.
• Located in Indianapolis
• Serves Ascension and its subsidiaries
• Responds to an ever-changing workplace by building a community
of associates who are flexible, innovative, and outstanding
service providers
Works closely with process partners across Ascension
to provide services related to human resources, payroll,
supply chain, finance and travel
Plays a key role in Ascension’s
effort to transform healthcare.
22
Ascension Ministry Service Center
$717
$496
$28
$36 $47
$307
Strategic Sourcing / Contract Compliance
SmartHealth
Non Medical Benefits
Process Improvements
IT Hardware & Software Retirements
Position Efficiencies
Symphony Savings Comparison
23
FY09 through FY18
$ in Millions
Original Savings = $1.6B
$1,487 $361
$72
$86
$43
$330
Current Savings
(incl. Extension) = $2.4B
• Portfolio of services including: contracting, operations and logistics,
integrated change management, and implementation services
• Operates a group purchasing organization (GPO), which benefits
members by leveraging their contract portfolio to increase
efficiency, decrease waste and reduce costs for participants
and suppliers
A resource management organization that provides a portfolio
of solutions to Ascension and non-Ascension participants
24
Reduced Ascension’s annual supply
expense by $896 million including:
• $676 million in supplies
• $220 million in other non-payroll spend
The Resource Group
Local Health Ministry
Accretive Partner
Ascension Health
25
One Ascension Revenue Cycle
26
Revenue Cycle
Collaboration with Accretive Health focused on revenue cycle management in all
hospitals:
Ascension Healthcare – Accretive Partnership
Create a structure to free-up capabilities & capacity to improve processes
Value is created by optimizing processes at the interface points
Leverage technology to deliver superior outcomes
Daily/weekly operating cadence more important than monthly/quarterly
Standardization is the best way to combat rising complexity
% Improvement expected with delivery model
Payer
Yield
2%
Patient
Yield
1%
Uninsured
Conversion
1%
Net Impact of
Revenue Cycle
Improvements =
$110 million
Goals & Accomplishment in Optimizing our Provider Platform
Improve
Financial
Performance
Quality
Development
of Regionally
Integrated
Systems of
Care
Provider
Engagement
& Alignment
Provider Engagement & Alignment
Quality
Improve Financial Performance
Development of Regionally Integrated
Systems of Care
Focused on dashboards and analytics to report and review
performance; mammography screening; readmissions reductions;
performance management to systemically drive improvement at
provider/clinic level; and clinical leader engagement
Focused on physician formation and leadership development;
implementing one leadership structure to engage physicians in
decision making; provider satisfaction improvement; and
transitioning to standard compensation template and model
Focused on practice growth and revenue cycle with attention to
patient access and engagement to grow practices, revenue cycle
metrics and patient satisfaction
Focused on contributions to help drive successful transition to
value-based care through expansion of access and practice
growth
27
Ascension Medical Group
Accomplishments
Implemented standardized
physician practice management
platform for 85% of employed
ambulatory providers
Improved mammography
screening rate for eligible
patients by over 15% to 63.4%
Achieved a 5% increase in
number of primary care lives
served (1.6 million YTD)
CURRENT VALUE-BASED HEALTHCARE
DELIVERY
3
7
3
6
Wholly/Partially Owned Health Plans
MSSP ACOs in 12 Ministry Markets
Ministry Markets Participating in CJR
Bundled Payments (16 hospitals)
Ministry Markets Participating
in CMMI Bundled Payments
PACE Programs
Covered Lives Under Value-Based
Contractual Arrangements2.6MEmployed Providers>7,000
OTHER SYSTEM MEASURES
28
Map Key:
14
Clinically Integrated Network Development
Clinical Management
Member Services
Administrative Capabilities
29
Ascension Care Management
Building core capabilities to launch a growing number
of services and solutions in diverse markets
Continuing the Journey
31
Succeeding in a Matrixed Model
Source: Master the Matrix: 7 Essentials for Getting Things Done in Complex
Organizations by Susan Finerty
32
We are all responsible for
Ascension’s Financial Performance.
One Mission. One Integrated Ministry. One Ascension.
Running 129 Hospitals: Financial
Management Insights from the
Nation’s Largest Nonprofit Health
System
Rhonda C. Anderson
Senior Vice President and Chief Financial Officer
Ascension Healthcare
November 9, 2016
Recommended