How the District of Columbia Government (United Medical Center (UMC)) stabilized hospital operations, saved jobs and increased services through a partnership with The Chappelle Group
UMC dba Not-For-Profit Hospital Corporation, a 300-bed safety-net hospital in Ward 8 of Washington, DC, was in a financial crisis and facing possible closure. With $90M in annual net revenue, the hospital supporting over 70% of the city’s Medicaid population and employed over 1,000 individuals. With over $30M in stranded A/R, less than a week of operating capital on-hand, and monthly collections of 5M, the Chief Financial Officer (CFO) engaged The Chappelle Group (TCG) for immediate impact.
At the time of engagement, UMC was being acquired by the District of Columbia Government and leadership was under immense pressure to stabilize the finances. The city loaned UMC $20M in operating capital with a three-year term. A team of four TCG RCM experts were engaged and worked closely with hospital and government leaders to aggressively improve the financial situation.
- Accelerate Cash Collections
- Reduce stranded AR
- Stabilize Business Office and RCM
Accelerate Cash Collections. After careful evaluation and analysis, TCG led the reorganization and restructuring of key business office personnel and provided interim management positions:
(a) Implemented a two-tier team structure within the business office.
(b) Increased technology in key areas, to include: contract management, treasury services, and denials management.
(c) Created a hospital-wide RCM committee that allowed all stakeholders to fully understand their RCM roles and responsibilities for charge capture, proper documentation, and net revenue collection.
(d) Developed essential relationships with leadership at top payers which allowed for the re-opening of stranded AR from prior periods, a streamlined process for denial management, expedited remittance processing, and the renegotiation of the fee schedule for primary service lines.
Reduced Stranded AR. Implemented a targeted 8-person business office team to analyze and recover all stranded AR. TCG’s experienced a 45% recovery rate for all stranded AR populations.
Stabilization of Business Office/RCM. TCG senior leadership assumed the directorship of the UMC revenue cycle- with key leadership in Patient Access, Health Information Management, and the Business office. The interim management team implemented HFMA best practices training according to the service area for front line staff. TCG also provided leadership training for supervisors and management. Our experts created monitoring tools (dashboards) by the department to analyze errors and success. Lastly, we conducted studies ultimately resulting in the implementation of goal-based salary and bonus increase programs.
TCG’s leadership, best practices modeling, and cash acceleration expertise created $42M in new revenue and $15M in stranded AR cash recovery within an 18-month period. The strength of the project results allowed UMC to repay 18M or 90% of the $20M loan from the District of Columbia government halfway through the term. Moreover, due to the implementation of the system-wide RCM committee, the patient satisfaction survey rating (Press Ganey) increased. Most importantly, the long term effects of the increased revenue yielded new service lines which allowed UMC to better meet the growing needs of the community and increase the job footprint across the metropolitan region. Under TCG’s financial leadership, UMC recorded its first profitable year in over 20 years.
“I gave The Chappelle Group and Jamal Chappelle what I thought was a task that could not be fully accomplished; that was the cultural transformation of the business office. I underestimated Mr. Chappelle. He accomplished and exceeded all goals placed before him. He and his group are exceptionally skilled.”
- Derrick Hollings, EVP, Chief Financial Officer, United Medical Center (former)
EVP, Chief Finance Officer, Hennepin Healthcare (current)
Type: 300-bed, urban safety-net hospital
Location: Washington, DC, southeastern quadrant
Annual Gross Revenue: $300M
Payer Mix: 80% Medicaid, 10% Commercial, 10% Self-Pay