Leadership Perspectives on RCM in Healthcare
On this episode of Leader to Leader, we discuss all things Revenue Cycle Management with Douglas Hires, the former COO of OptumInsight, the Provider and RCM technology and outsourcing division of Optum Healthcare.
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In this premier episode of Leader to Leader, host Ben Hilmes has an illuminating conversation with former Chief Operating Officer at OptumInsight and current Elite Advisor with Healthcare IT Leaders, Doug Hires. Doug shares his insights into revenue cycle management, the shift toward outsourcing, and how best to leverage emerging technologies to improve efficiency.
- Healthcare organizations need to think holistically about revenue cycle management, and incorporate it throughout the entire healthcare delivery process.
- Healthcare leaders should be open to RCM outsourcing as a strategy to alleviate workforce challenges and reduce costs.
- Claims denials are a persistent issue. Organizations must continue to optimize workflows and implement automation tools to reduce denials and improve revenue cycle efficiency.
- Providers and payers must find common ground to address the inherent challenges in the payment cycle.
- Leadership requires self-awareness and emotional intelligence. The best leaders listen to their teams and are open to feedback.
Douglas “Doug” Hires offers powerful executive insights based on 35+ years in IT, Revenue Cycle, and Business Process Outsourcing working with providers, payers, government, and life sciences. Most recently, Doug was Chief Operating Officer (Provider) for OptumInsight, offering revenue cycle outsourcing and optimization, including coding, billing, and collections for care providers.
Prior to the formation of OptumInsight, Doug was Chief Operating Officer (Hospital Services) of Optum360 LLC under Optum, providing revenue cycle management services for health systems. During his tenure, he oversaw end-to-end RCM operations for multiple clients, including Dignity Health, where he helped the 36-hospitalsystem significantly reduce AR Days, Bad Debt, Initial and Final Denials while increasing cash collections to record levels.
Before joining Optum, Doug held healthcare sales and senior leadership positions with Santa Rosa Consulting, 3M Health Information Systems, and First Consulting Group. In each role, he worked directly with healthcare provider organizations managing service delivery and offering strategic insights. LinkedIN →
Doug Hires [00:00:00]:
What are the components of leadership? What makes a good leader? How do you develop yourself as as a leader? And what I learned across that was some some very interesting skills. One set of skills had to be very internal. Know yourself, know who you are, how you feel, what’s going on, the emotional intelligence, basically, of self awareness and to be self aware in the business environment, to be self aware with your teams.
From Healthcare It Leaders. You’re listening to leader to leader with Ben Hilmes. On today’s episode. Our guest is former chief operating officer At OptumInsight, Doug Hires. Doug is an Elite Advisor with Healthcare IT Leaders and a revenue cycle management expert who has held senior leadership roles with payer, provider and consulting organizations over 30 plus years in healthcare.
Ben Hilmes [00:00:58]:
Welcome to the show, Doug. It’s great to have you actually on our very first podcast, Leader to Leader. So welcome to the show. It’s been great getting to know you here in the past several weeks as you became part of our Elite Advisor program here at Healthcare IT Leaders and couldn’t think of somebody better for a program like that, given your extensive very impressive. Why don’t we just start with a little bit of dialogue around where you most recently came many, many years in the industry, ultimately left as the Chief Operating Officer at Optum Insight, where you were responsible for overall operations and performance for a two plus billion dollar PNL and more than 10,000 employees. So if you can give us some perspective and background on that, I would love to hear it.
Doug Hires [00:01:52]:
Sure. Thanks so much, Ben. It’s really great to be here, appreciate the opportunity and really excited to talk with you today about revenue cycle in the industry and healthcare industry and leadership in general as well. Yes, you’re correct. Was the Chief Operating Officer for a division within Optum Insight, which is part of UnitedHealth Group, the parent company Optum and UnitedHealthcare, the two major flagship divisions. Optum Insight is one of three divisions. Of the 200 billion dollar Optum, it’s the smallest one. It’s around 15 billion or so, but it’s the managed services and the technology arm of Optum. And in my role, as you mentioned, I was responsible for all of our operations relative to the provider clients that we served within Optum. Provider defined as hospitals, hospital systems, medical groups, medical practices, laboratory, and so forth, both clinical and financial services that we delivered, as well as responsible for all the technology that we developed as Optum, Optum branded technology and its implementation and then its ongoing maintenance and service and operation. So it was a large team, was a wonderful team that I was fortunate enough to be the leader over that actually spanned the entire globe and that largely operations in the US. But also in several countries outside of the US. As well.
Ben Hilmes [00:03:35]:
Wow, that’s extensive career covering the globe is a big space, and I know you still stay very active talking to people in the industry, revenue cycle leaders, and I’d love for you to share with the group. What are you hearing? I mean, when you think about their challenges, what they’re faced with, the topics that are coming up in your conversation as you’re helping people think through strategies to meet today’s demands and tomorrow’s demands, what is going on in those conversations?
Doug Hires [00:04:14]:
Well, there’s quite a bit interestingly that’s going on. I think over time and what we’ve seen certainly pre pandemic to post pandemic. The revenue cycle in general for organizations has become much more clear and in focus as one of the strategic imperatives for business performance. At the end of the day, it’s certainly generating revenue, it’s collecting cash. And never before has it been more challenging for organizations to successfully navigate the complex healthcare reimbursement system that we have in the US. And at the same time more critical in terms of feeding the lifeblood of every organization. Whether it’s a 50 doc physician practice or whether it’s a 200 hospital health system, it’s clear that financial performance has been under tremendous stress. You’ve got inflation in the economy, you’ve got challenges with workforces and how do we do it better, how do we do it faster, how do we do it with more effectiveness has been the topics that we discuss. Technology always falls into the conversation and it has to we can’t just continue loading people into this operating model in order to effectively change the outcomes. It requires more advanced technology, certainly robotics, RPA, as it’s been referred to as, kind of developed over the last few years. But now really in the essence of where do we take technology even further, it’s around artificial intelligence, it’s around machine learning, it’s around how do we get into a more predictive mode of operating the business rather than just reacting to things and trying to do cycles faster. So there’s a lot involved in terms of performance accuracy also really dealing with the patient experience. The patient experience has become central. There are certainly a number of governmental acts that have taken place, such as the no Surprise Act and that was a revenue cycle challenge to implement a year ago January. There are a number of things that bring the patient to the center. And that’s important because the patient responsibility has almost tripled over the last four years from what it has been, with high deductibles, more balance after insurance payments that have to be made. And patient debt now is a significant amount of the bad debt that hits the bottom line, hits the ledgers of these organizations. So how do we improve that? How do we give them a better experience but also increase and improve collections?
Ben Hilmes [00:07:19]:
A lot of important topics there. Now I’d like to pivot a little bit where you started, which is around the pandemic and the impact that has had not just on rep cycle management, but the entire industry. And we started to see this distributed, remote workforce, and you talked about it earlier, that the historical strategy is just to throw more people at it. Well, one, we don’t have more people to throw at it, given the workforce challenges. We’re now looking at ways to leverage technology and deliver against the overall objectives of the organization in a different way. And that’s pushed people to think differently about rev cycle management. And we’re starting to see this emergence of outsourcing. So there are a number of companies like Optum, like Huron, like R, One, like Ensemble, really see significant growth in the rev cycle management outsourcing space. I’m curious to see what your perspective is and what you’re hearing when you talk to healthcare leaders, not just in the US. But around the world, about how they are thinking and inquiring about considering an outsourcing option for cycle management.
Doug Hires [00:08:40]:
Yeah, well, absolutely. So that’s a broad set of topics as well that you brought forward. The pandemic has obviously, from a global perspective, and certainly here in the US, been the most disruptive thing that we’ve seen in this century and even into the last century, all the way back to the Spanish flu, I guess. So really impactful in terms of business, in terms of people lifestyles, things that have taken place. Health care got hit very hard because we had to keep the doors open. It wasn’t the unfortunate circumstance of a retail store being closed or a restaurant being closed. We had to serve sick patients throughout that entire experience. And it was an exceptional burden on organizations and on workers and staff, the frontline staff. So whether it’s clinical staff, physicians and nurses, or the revenue cycle teams doing patient access, doing the patient facing components, there was a lot of strain. And subsequently, while we could move a lot, and we did in fact, at Optum, my team was able to move our workforce to offsite work at home, literally thousands and thousands of people within a couple of weeks. It was a huge mental change in terms of being in that more isolated work environment. I think we’re still struggling with that a little bit today. The other piece has just been, again, as you mentioned, the talent pool has gotten smaller. Folks have changed careers, changed where they wanted to be, and in many cases, the healthcare industry has actually suffered in terms of lack of talent availability. So how do you address it? How do you fix that? Well, in many ways, again, it goes back to tech and technology and capabilities. What can we replace that were human functions before, that we can now basically supplement with certain technology capabilities? The other thing, as it goes back to patient and patient experience is how much more self service can we introduce into the technology spectrum, into that digital experience that we want to continually expand in the healthcare settings to allow folks to interact with us digitally and through Tech without necessarily having to have an operator on the phone, without waiting and waiting and waiting to try and get an appointment because they’re trying to get an answer or a callback or something. So call centers have shifted in terms of how their IVR systems work and how their digital platforms engage with patients. Health systems leaders are thinking about that all the time. How do I improve it and how do I address consumerism in a stronger way? So I think that’s part of what happens. I mentioned artificial intelligence and machine learning and some advanced technology capabilities. We’re on the beginning of that when it comes to rev cycle, but it’s available and it’s going to be developed by a number of organizations. You mentioned outsourcing. And outsourcing, of course, has been around for decades in various ways. Whether it’s it outsourcing, revenue cycles, supply chain, and certainly in healthcare, food services, housekeeping. There’s a number of outsourced capabilities that typically organizations make their strategic decisions around. But when it comes to RCM rev cycle in particular, it can help organizations address labor shortages. Absolutely. Because you can go with a company that has a pool or has the ability to staff up and ramp up far better. And sometimes that workforce doesn’t come from down the street. It may be across the country in a different state or it may be even in a different country. And while that has always been probably a political struggle for many organizations commitment to their local community, what am I doing if I end up with workers that are outside that community? Whether it’s onshore or offshore has been a challenge. But they found that there has to be a balance because of the deficit, especially rural health systems and rural medical groups. They’re just kind of isolated in terms of access. And so in those cases, using a partner, a strategic partner that can bring expertise, that can bring technology as well as a workforce because it is people process and tech that provides the better performance, becomes something to consider. And many organizations now post pandemic are much more open to considering a partner.
Ben Hilmes [00:13:56]:
So looking at all that’s coming to the forefront in revc ycle management, whether it’s automation or outsourcing, tremendous amount of technology ingesting that’s going on, providers that I talk to, the space I used to live in, the providers you talk to, I know they’re all hyper focused on overall spend, the whole cost to collect and et cetera. Love to hear your perspective. And do you believe that with the ingestion of different operating models, different technologies, et cetera, do we really have a shot at bending the cost curve here? And is that something that we can literally not look at our shoes when asked and be able to boldly say we believe that there is an opportunity here to help organizations achieve efficiency, achieve better outcomes, and ultimately bend that cost curve?
Doug Hires [00:15:03]:
Yeah, well, yes, the cost curve continues to be a challenge and internal cost for the operations of rev cycle, let’s talk about that specifically rather than the overall cost of healthcare in the United States, which is an even broader topic, but from a rev cycle perspective is exactly cost to collect. How much effort and energy and dollars do I need to spend in order to get the dollars that I deserve, that I billed for effectively and accurately and within compliance to maximize my reimbursement? And again, different organizations are more mature in that in some cases with larger assets, larger health systems can really focus their internal capabilities to improve on that. And you can take cost out in that. Looking for repetitive issues and repetitive processes and repetitive problems tends to be one of the focal points. For instance, denial management, clinical denials continue to accelerate. There’s a lot of noise in the payer and provider friction world out there today more than ever. And how do you get to avoidance? How do you get to denial avoidance? And what are the techniques that you do? Because the cost of running in circles around that claim that ultimately does get paid is the cost that needs to be reduced most significantly. It’s not just about whether or not your collection folks are staying on top of the queue, it’s how do we change the cycle that’s going on. And that cost collect also extends accounts receivable. Many organizations have seen their AR days jump from 40 or 45 days to 55 to 65 days now simply based on the pay cycles that they’re going through and this friction between the payers that they have in their network and the patients that they serve. So if we can collapse that, we can collapse the cost. And that’s interestingly enough, that’s a cost savings that’s not just available to providers, it’s a cost for payers as well. And so where do we go to really try and push this relationship and how do we help our providers push the relationship with their payers, with their central payers to collaborate on reducing those efforts? Because both sides win in that regard. And ultimately, while payers are trying to pay less out and providers are trying to collect the most they can collect, there is some middle ground there where both can work together.
Ben Hilmes [00:17:48]:
Yeah, I think you mentioned payers. I think they in many times get left out of a number of conversations when I’m talking to providers about rev cycle management strategies. But those that are kind of on leading edge are driving to how do I collaborate better, how do I even jointly produce different solutions directly with my payers? We were working on a number of those strategies when I was out west and I’m just curious, are you seeing a growing and emerging, is there a tipping point coming where you start to see better collaboration across the payer provider world?
Doug Hires [00:18:29]:
Yeah, I think that’s a great way to phrase it, a tipping point coming. And I believe that is true. One of the things that’s central to this is data. And being able to capture and analyze provide the analytics into that data and to be able to demonstrate both sides to be able to demonstrate to each other what the data is showing around the operational issues, the clinical issues, the clinical procedure issues, the contractual issues, all of those complexities in the relationship fundamentally come down to being able to show where the problems are and defend it with data. And both sides are getting much better at that. And that, I think, is opening the dialogue and opening the channel. If it becomes anecdotal and a provider just claims to their payer in a joint review, you just seem to be denying all of my hip procedures. I don’t understand this. They want to know, well, show me exactly what and how, right? One of the things that I also talk with revenue cycle leaders about is how do you manage your data more effectively? It’s not just the standard metrics of AR, bad debt denial rates, different things like that, cash collection ratios, but what are we really looking at in terms of the fundamental information that clinical data combined with the rev cycle data can help us in our revenue cycle performance? And that’s a key area strategically going forward where I see a lot of organizations investing and needing to invest in.
Ben Hilmes [00:20:15]:
Terms of data mean really, really good perspective. Doug, I’m sitting here listening to you and I’m trying to put myself in the seat of a revenue cycle leader, and I’m going, holy cow, where do I start? Because this thing is like one bite at a time. But what’s the first bite? What guidance would you give to revenue cycle leaders out there that they know they need to move? They know that staying where they are today is going to continue to send them continuously behind or further behind competition? What guidance do you give leaders out there that know they need to move? They just are paralyzed with what to do first?
Doug Hires [00:21:02]:
Well, you’re exactly right. It’s huge. A number of problems, the variations of those can be huge. So what I tell folks very often and have throughout my career, the first thing to do is to really take a good look at what’s going on inside your own house. You’ve got to be able to and again, that takes data, that takes analysis, that takes review. And that data and review is not just statistical. You need to look at your processes. You need to look at where are my people spending time? How are they spending time? How much time are they spending when they do it? And what are the results that are getting? What are my performance metrics that I should have within my house? How do I know that my coders are productive? What data do I have? And how am I monitoring Q’s, DNFB, various components around the operational component of middle revenue cycle and am I efficient, am I optimized, am I using the tools that I have effectively? There’s a lot of automation that’s already in place. There’s a lot of tools and technology, simple patient accounting systems, yes, but then all the bolt on components as well. But is my workforce really utilizing it in an effective way? The other thing to do is to take a look at areas around payment integrity. Am I collecting the maximums that I need? What happens to my zero balance portfolio and zero balance of course is it looks like I’ve claimed everything I should collected excuse me, everything that I should. But in essence, if I go back and if I do an audit of those zero balance accounts, I very often can find and we in revenue cycle typically see this errors that were made, collectors that incorrectly netted down an account in some way and ultimately left some dollars on the table. So again, with data, with analytics, with review, with audit, you can find some cash and you can find some performance opportunities. Having a really good relationship with your managed care team that negotiates the contracts is a critical component for a rev cycle leader. Being able to work and lockstep, basically, with that organization, feeding them information about the challenges the Rev cycle has for the contract negotiations that are upcoming, for the renewals that are coming, or for even the joint reviews that are ongoing and taking place in terms of trying to resolve disputes is an important thing. And I always advise that that partnership really be focused upon to ensure that everybody understands what the opportunities and what the challenges are.
Ben Hilmes [00:24:04]:
Those are amazing insights, Doug and I know those that are listening are going to just get a ton of nuggets to take away and the most important thing is to get started. That first step is ultimately the hardest, but you got to start the journey somewhere. And so those are some excellent insights. Let’s pivot to just the overall topic of leadership. I know you’re passionate about leadership. You’ve been in just a myriad of leadership roles throughout your career. Talk to me a little bit about where you first got into leadership and what was it about being a leader that just stoked that desire to want to grow in that capacity? What is it about being a leader that keeps you motivated and excited to continue to share about your perspectives on leadership?
Doug Hires [00:24:59]:
Well, Ben, thanks for asking about this because you’re right, very passionate. I love talking about this topic with folks and it’s been something that I’ve tried to focus the majority of my career upon, quite honestly. So to take it back, I was very lucky in my career early on to be part of a consulting organization that decided it was going to build a leadership development program their own internal. That the best way for this company to expand itself, and we’re talking 23 years ago, was to build and develop internal leaders. Not to just try and grab them from Accenture or E&Y and so on and so forth. And I was able to sit on a steering committee. I got nominated because I had a great mentor and manager that saw some potential in me. And that steering committee developed the leadership program. We got a chance to work with the great Warren Bennis in that regard. We had hired him to work and to advise and help us develop that. And he became a tremendous influence. It was such a joy and an opportunity. Unfortunately, he’s passed away a few years back now. But back then he was central to leadership, leadership development. I think he’s published 20 books or so. So that kind of gave me my foundation and my core about what are the components of leadership, what makes a good leader, how do you develop yourself as a leader. And what I learned across that was some very interesting skills. One set of skills had to be very internal. Know yourself, know who you are, how you feel, what’s going on. The emotional intelligence, basically, of self awareness. And to be self aware in the business environment, to be self aware with your teams. The other thing that I learned was how to be aware of others and how to be aware of what their motivations were, how to listen very carefully to people, hear what they’re saying, hear what they’re trying to communicate. Because the whole success factor around leadership is communication and listening. It really is. We want that bi directionally, of course, you would think. But ultimately being able to listen to your teams is a critical success factor. And then to take action with what you learn, with what you’re able to do with that. It’s been a great journey for me. I love mentoring people, I love helping people grow. And as a leader, I think really my responsibility and my role is to be in the background, rather in the foreground, is to get my teams the opportunity to be exposed, to learn to be successful, to come together, to help them, to motivate them. Certainly there’s a lot of motivation that goes into leadership, but ultimately to allow them to succeed or fail, to learn and to develop and to become the great leaders that they aspire to be as well. There’s nothing more gratifying to me personally, than watching folks that I’ve been able to help along the way become very successful.
Ben Hilmes [00:28:27]:
That’s excellent. I think that is the biggest reward is seeing others succeed under your leadership and know that you had just a little piece in that process. The other thing that’s really insightful here is that you hear the term nausea’s, a natural born leader, or she’s a natural born leader. The point is, leaders, the excellent ones, have to get up every day and have to work at it. And you kind of mentioned all the things along the way that you do. So to other leaders out there. Maybe you’re not where you want to be yet, but the reality is you can subscribe to this concept of I want to be a great leader. And there are so many things out there that can help you to sharpen that skill and to become the leader that you want to be. So it sounds like you’ve invested heavily in yourself and that has certainly paid off and benefited you. But more importantly, because it’s not about you and you recognize that it’s about all those you get the opportunity to serve. So that’s really insightful. So we’re going to land every one of these shows kind of lands with a lightning ground. So you kind of have to put your seatbelt on and kind of go with it and kind of talk about briefly what comes to the top of your mind as we go through these things. And maybe you’ve answered this one, but who’s been the biggest influence on you as a leader?
Doug Hires [00:29:58]:
If I go back to what we just talked about at the core, beginning Warren Venice being an influence for sure, but also the CEO of that same consulting firm. His name is Luther Newsbaum. And Luther had the vision and the strategy to deploy around this. And I spent a lot of time with him as well, and he was a very strong influencer.
Ben Hilmes [00:30:21]:
That’s awesome. That is awesome. So when you’re not giving advice to rev cycle leaders and leaders in general, or sitting on a podcast with somebody like me and you have free time and you’re out enjoying that, what do you gravitate towards?
Doug Hires [00:30:40]:
I actually have a music background. Early in my life, I was a professional musician and trained in that regard. Subsequently, obviously had a career in business. But music is always a passion for me. I’m also a food nut. I love to cook. I fancy myself as an amateur chef. And what goes better with food than wine? I enjoy collecting wine. In fact, I actually studied to become a certified sommelier.
Ben Hilmes [00:31:14]:
That’s awesome. It’s interesting you gravitate towards complex things, though. Music, wine, food all can be very complex, which so is your career revenue cycle is probably the most complex thing that I’ve seen inside of the things that I have done. Anything you gravitate towards when you’re reading? Is there a particular book, and maybe it’s just for fun that you’re reading right now?
Doug Hires [00:31:45]:
The most recent book that I read was The Leader’s Guide to Unconscious Bias. And it’s written by Pamela Fuller, Mark Murphy All of us, as we’ve seen in the culture of the United States developing over these past few years, need a much better awareness of our unconscious bias. This talks about how to tackle that. I mentioned that good leaders are self aware and understanding their feelings and what they’re thinking and being introspective as well as retrospective and this book really focuses on how do you do that.
Ben Hilmes [00:32:24]:
That’s great. Certainly going to put the book on my Amazon list. It’ll be here in a couple of days. I can tell you blind spots are important as leaders to recognize and so very good insight. So one more. So you’re kind of going down this topic anyway, but if you’re a young up and coming leader, what kind of general advice would you give them as they’re starting to embark? And in general, what are some other things that as you coach young emerging leaders, kind of what insights would you give them?
Doug Hires [00:33:04]:
What I’d mentioned before about working on your self awareness, working on your own emotional intelligence, understanding yourself is an important journey. I think it’s also important to tag a mentor. And I think the mentor, while very often you may think it’s a manager or somebody that you’re already working for, I would encourage you to look outside of that. And it can be outside of your organization. It can come from a lot of different places. The other piece is to make sure that you’re talking to your teams. And if you’re not in a regular dialogue, in terms of getting to know your folks and getting to know the people that are on your teams, make sure that you’re really applying that effort.
Ben Hilmes [00:33:57]:
Outstanding. Doug. I think that goes for not just young leaders, but any leader. So those are very helpful insights. And with that, I just want to say thank we really appreciate one, your time. Two, your insights. It’s really refreshing to hear you talk about not just revenue cycle and some insights on where we can take that space inside of the work we do. But then secondly, just the helpful insights for leaders in general, and particularly those young up and coming leaders, because we both know this industry needs more and better leaders and leadership development. So with that, I just want to thank you for joining leader to leader again. Welcome to our Elite Advisor program. It’s going to be awesome working with you in the days, weeks and years to come. So with that, I think it’s a wrap, but I really appreciate it.
Doug Hires [00:34:59]:
Thank you so much. Really enjoyed the conversation today. Look forward to more things that we can help the listeners with Q and A that may come out of this or something else. Happy to help and be part of that, but thanks for the opportunity. Great to see you today.
Ben Hilmes [00:35:24]:
I really enjoyed talking to Doug. He has a lot of wisdom to share about healthcare and revenue cycle management. Here are my top takeaways from today’s session. One, healthcare organizations need to think holistically about revenue cycle management and how to incorporate that throughout the entire healthcare delivery process. Two, healthcare leaders should be open to rev cycle management outsourcing as a strategy to help alleviate workforce challenges and to help reductions in cost. Three, claims denials. Are a persistent issue. Organizations must continue to optimize workflows and implement automation tools to reduce denials and improve revenue cycle efficiency. Four, providers and payers must communicate, and they have to find common ground to address the inherent challenges in the payment cycle. And five, leadership requires self awareness and emotional intelligence. The best leaders listen to their teams and are open to constructive feedback. So what did you think? What were your big takeaways from today’s episode? I’d love to hear from you on our social media channels or drop me an email on our website at healthcareitleaders.com. And until next time, I’m Ben Hilmes.
Thanks for joining us for Leader to Leader. To learn more about how to fuel your own personal leadership journey through the healthcare industry, visit healthcareitleaders.com. Don’t forget to subscribe so you don’t miss any insights, and we’ll see you on the next episode.