How CFOs Can Improve Clinical Outcomes

While the healthcare industry still debates the merits of a performance-driven system, payers are moving ahead vigorously with compensation strategies tied to clinical outcomes.

And if weren't apparent when these pay-for-performance (P4P) initiatives started gaining momentum that finance and clinical departments needed to align their objectives, Medicare's additional efforts to financially penalize organizations that fail to prove medical necessity have amplified calls for even tighter clinical-finance bond.

However, this remains a difficult proposition for many set-in-their-ways leaders who, growing up under fee-for-service and capitation payment models, maintained distinct roles, interacting only when necessary. After all, clinicians, often focused on cost-avoidance (with their budgets and all), and finance types, striving for cost recovery, (those darn balance sheets) don't always speak the same language.

"Some CFOs have been a little slow to embrace the fact they need to work more closely [with] clinical teams," says Joanne Webb, CEO & partner of J. A. Thomas & Associates (JATA), a clinical documentation improvement solutions provider.

Webb, who is also a registered nurse, isn't knocking CFOs, just stating what she's observed in some of 500 or so hospitals her firm has worked with. And her insights cut both ways. "Medical staff can be even more challenging to work with," she states. "Most simply want to practice medicine."

So BFF (best friends forever in text-speak) might be a stretch, but CFOs and medical officers are finding common ground in the fact that improved clinical outcomes equals improved financial results.

Hospitals, though, still struggle to get paid all they are owed for the care they deliver. What's the problem? Prior to P4P, data quality was important, but not of the magnitude it is today, Webb says. "Now that quality outcomes—mortality, morbidity, length of stay and even medical necessity—are being watched more closely, hospitals are challenged to thoroughly and accurately explain why a patient is in the hospital and justify their treatment plan."

Enter the electronic health record system (EHR), or more specifically, the quality of data in these systems. Many organizations believed that an EHR would solve all their data integrity issues, according to Webb. "At the end of the day, data that's in the EHR comes from the work individuals have done. If it's not being captured accurately, hospitals are at a disadvantage from the start. Now it's more than a clinical issue, it's financial."

Webb adds the caveat that it's likely not a coding issue, even though the blame often lands here. Rather, the problem is in the quality of clinical information, largely because physicians often have not been taught how to document well. "There must be an effort to ensure the clinical information that physicians' document also drive the best financial results," she says.

It's for this reason that financial leaders must take a more proactive stance on performance improvement as it applies to documentation. "If I were a CFO, I would insert myself some way or another into these issues to bring the hospital's business component to physicians," Webb says. "So focused are physicians on patient care, they often are not tuned into the business aspects.

Going forward, the focus must be on how financial aspects of healthcare, in addition to clinical, are going to benefit the way we provide care in the future. "Efforts such as the accountable care organization (ACO) are doing us a favor in this regard by setting table for what's coming—likely bundled payments and incentives based on hospitals providing efficiencies," according to Webb.