Revenue Generation - Society for Academic Emergency Medicine

Report
REVENUE GENERATION
Richard Wolfe, MD
Beth Israel Deaconess Medical Center
“If you want to know what
God thinks of money, just
look at the people he gave
it to.”
Revenue Generation
Goals and Means

Alignment of Goals
 Personal
goals
 Leadership goals
 Departmental goals
 Institutional goals

What means are needed to achieve your goals?
Why generate revenue?
Faculty Development
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Protected time
Seed money and bridging money for research
Additional training
Infrastructure
Building new areas for practice, research, and
education
Reserves for the future
Individual Gain Versus Group Gain
The Future of Academic Health Care
Life Expectancy and
Expenditure per Capita
Cost of Care: Percentage of GDP
The Economic Future of Emergency Medicine
Will ED utilization and clinical revenue change?
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Risk contracts
Effect of co-pays
Patient behavior during hard times
Reimbursement for professional services
EMRs and patient per hour speeds
Economics of Academics
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Hospital and medical school funds flow
Federal funding of research
Industrial funding of research
Professional societies
Development
Although prepared for martyrdom,
I preferred that it be postponed.
Know Your Institution
Who controls the money?
Clinical income?
 Consultations?
 Indirect reimbursement for grants?
 Societal and industrial grant revenue?
 Moonlighting?

Practice Plans
Mushroom Management
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Kept in the dark
Fed bullshit
When grown big, canned
Loss of transparency  Loss of trust
Personal goals predominate over departmental
goals
Practice Plans
The Philosopher King or Queen
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Trustworthy and equitable leader
Inspires a shared vision in those they lead
Can produce remarkable revenue growth
Depends on the skills of the leader rather than the
system
Practice Plans
The Secret Life of the Bees
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Staff specialized into
academic or clinical
Academic track receives
lion share of
development
Loss of shared incentives
Revenue generation
depends on limited
number of members in
the group
Practice Plans
Partnership with the Faculty

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Shared vision established as a group
Complete financial transparency
Mutual trust
Taxation with representation
Eat what you kill after taxes
Revenue Generation
Golden Rules

One should treat others as one would like others to treat oneself
The one with the gold, makes the rule
You can’t make up negative margins with volume
Lost indirect revenue sinks departments

What do you call academic activities that cannot lead to revenue generation?
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Sources of Revenue

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Areas that you control financially
Incentives based on performance
Negotiations with your leadership
Principles of Departmental Taxation

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Equity: tax everything!
Incentives: size matters
Transparency: maintain trust
Representation
Taxation with representation ain't so hot either.
Gerald Barzan
No Margin, No Mission
Sister Irene Krause
Daughters of Charity
Sources of Revenue
Classic Sources of Revenue
Administrative
Grants
Education
Clinical
Revenue Generation
Clinical: Every penny counts
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Easiest and most lucrative source
Clinical revenue vs. cost of a provider
Quality of documentation
Coding, billing, and revenue cycle
Knowing who the customer is volume growth
Revenue Generation
Clinical: Diversifying Clinical Income
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Observation units
Emergency department contracts
Urgent care
Ultrasound
Revenue Generation
Clinical: Subspecialization
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Toxicology
Hyperbarics
Sports Medicine
Urgent Care
Hospitalists
Intensivists
Funds Flow: Institution vs. Faculty
Research
Clinical
Education
Administration
Institutional Funds Flow
Administrative Stipends
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Leadership
Residency and medical school
Quality improvement
EMS
Hospital committees and positions
Revenue Generation
Institutional Funds Flow
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Office space
Lab space
Administrative assistants
Seed money and bridging for research
Academic titles and affiliations
There ain't no such thing as a
free lunch…
Revenue Generation
Administrative Consulting
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Quality improvement
Patient flow
Patient satisfaction
Revenue enhancement
Dirty Money: Industry
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Hand outs
Speaker panels
Meeting sponsorship
Research Grants
Institute of Medicine
A conflict of interest is a set of circumstances that
creates a risk that professional judgment or
actions regarding a primary interest will be
unduly influenced by a secondary interest.
http://iom.edu/CMS/3740/47464/65721.aspx
Potential Impact of Conflict of Interest
in Practice
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Education – introduction of commercial bias
Research – misrepresentation, suppression of
data
Practice – compromises professional judgment,
erodes public trust
Development: Sources
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Development office
Grateful and ungrateful
patients
Board and trustees
Alumni
Revenue Generation
EMS
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Hospital support
Medical direction
 Municipal
 Private
companies
 Fire departments
 Small community EMS
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CME
Government contracts and positions
Revenue Generation
Education: Residency
Building an Education Fund
for the Residency Program
 Medicare reimbursement for teaching
 Indirects for funded outside rotations
 Residency and research
 Extramural funding for international trainees
Revenue Generation
Education
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Speaker reimbursement
CME courses
 Regional,

national, international
Online education
Revenue Generation
Consulting and Education
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Clinical simulation
Residency development
International activities
 Jump
starting academic emergency departments
 Designing training programs
 Train the trainers
Revenue Generation
Research
Value of grant salary vs.
clinical salary
 Wet space versus dry
space
 Share of the indirect costs
 Federal versus Industry
 Clinical operations and
future funding
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Revenue Generation
Patents and Royalties
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Know who owns the IP rights and the rules
Royalties are usually shared between the
researcher, the department, and the institution
Creating corporations
International Consulting
American Medicine:
Simply the most expensive way to enjoy health care….
Emergency Medicine.
Thriving through the work aversion of
others

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