REVENUE GENERATION Richard Wolfe, MD Beth Israel Deaconess Medical Center.

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 GenerationGoals and Means Alignment of Goals

Personal goals Leadership goals Departmental goals Institutional goals

What means are needed to achieve your goals?

Why generate revenue?

Protected time Seed money and bridging money for

research Additional training Infrastructure Building new areas for practice,

research, and education Reserves for the future

Faculty Development

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 MedicineWill ED utilization and clinical revenue change?

Risk contracts Effect of co-pays Patient behavior during hard times Reimbursement for professional services EMRs and patient per hour speeds

Economics of Academics

Hospital and medical school funds flow Federal funding of research Industrial funding of research Professional societies Development

Although prepared for martyrdom, Although prepared for martyrdom, I preferred that it be postponed.I preferred that it be postponed.

Know Your InstitutionWho controls the money?

Clinical income? Consultations? Indirect reimbursement for

grants? Societal and industrial grant

revenue? Moonlighting?

Practice PlansMushroom Management

Kept in the dark Fed bullshit When grown big, canned Loss of transparency Loss of trust Personal goals predominate over

departmental goals

Practice PlansThe Philosopher King or Queen

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 PlansThe Secret Life of the Bees

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 PlansPartnership with the Faculty 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?

Sources of Revenue

Areas that you control financially Incentives based on performance Negotiations with your leadership

Principles of Departmental Taxation Equity: tax everything! Incentives: size matters Transparency: maintain trust Representation

Taxation with representation ain't so hot either.

Gerald Barzan

Sister Irene KrauseDaughters of Charity

No Margin, No Mission

Sources of Revenue

Clinical

GrantsEducation

Administrative

Classic Sources of Revenue

Revenue GenerationClinical: Every penny counts 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 GenerationClinical: Diversifying Clinical Income Observation units Emergency department contracts Urgent care Ultrasound

Revenue GenerationClinical: Subspecialization Toxicology Hyperbarics Sports Medicine Urgent Care Hospitalists Intensivists

Funds Flow: Institution vs. Faculty

Clinical

Research

Education

Administration

Institutional Funds FlowAdministrative Stipends Leadership Residency and medical school Quality improvement EMS Hospital committees and positions

Revenue GenerationInstitutional Funds Flow 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 GenerationAdministrative Consulting Quality improvement Patient flow Patient satisfaction Revenue enhancement

Dirty Money: Industry

Hand outs Speaker panels Meeting

sponsorship Research Grants

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

Institute of Medicine

Potential Impact of Conflict of Interest in Practice

Education – introduction of commercial bias

Research – misrepresentation, suppression of data

Practice – compromises professional judgment, erodes public trust

Development: Sources

Development office Grateful and

ungrateful patients Board and trustees Alumni

Revenue GenerationEMS

Hospital support Medical direction

Municipal Private companies Fire departments Small community EMS

CME Government contracts and positions

Revenue GenerationEducation: 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 GenerationEducation Speaker reimbursement CME courses

Regional, national, international Online education

Revenue GenerationConsulting and Education

Clinical simulation Residency development International activities

Jump starting academic emergency departments

Designing training programs Train the trainers

Revenue GenerationResearch

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

Revenue GenerationPatents and Royalties

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.Emergency Medicine.Thriving through the work Thriving through the work

aversion of othersaversion of others