Hospice Diagnosis Ð TCNtalks 2023 === Intro: Welcome to TCNtalks. The goal of our podcast is to provide concise and relevant information for busy hospice and palliative care leaders and staff. We understand your busy schedules and believe that brevity signals respect. And now here's our host, Chris Comeaux. (Chris Comeaux) Intro: Hello and welcome our guest. Today for TCN Talks is Janelle McCallum. Chris Comeaux: She's the Chief Clinical Operations Officer with Teleios Collaborative Network and Alan Sievers. He's our partner with B2B C F O. Welcome to both of you. Thank you. Thank you for having us. Absolutely. Two of my favorite people in the world. So, Janelle, let's start with you. What does our audience need to know about you? (Janelle McCallum) Um, ~I,~ It's been really fun seeing multiple programs working with tcn and I notice I'm seeing a lot of patterns, like some people see dead people. I see patterns and that's been helpful in this work. And, ~um, ~I just look forward to, ~um,~ seeing more of the long view, having seen those, those former historical patterns. So I'm delighted to be on the, on the podcast today. (Chris Comeaux) Chris Comeaux: It's good to have you, Janelle. Janelle, you have a pretty good history. I mean, that's why you're on RTC n team. ~Um, ~How many years in nursing now? Chris Comeaux: I'm not other. You look like you're like 20, so. (Janelle McCallum) Oh, that's right. Yes. It's over 30 years that I've been doing hospice work, actually. (Chris Comeaux) Chris Comeaux: So that's pretty cool. I'm curious in what a superpower. Can you think back in your, um, being a great case manager, did you actually see patterns even back then when you looked back on it? (Janelle McCallum) I think I did and probably I had more experience in the hospital. Um, I kind of jumped into hospice care and was in an inpatient unit as a nurse and then quickly was made the director of nursing. So I've been in (Janelle McCallum) leadership, um, for a really long time and, and have seen a lot of patterns and would. Was so excited when pain management first started getting talked about cause there were so many patterns there. So, as you say, looking back, that's probably always been something that has been in, been interesting to me. Cool. (Chris Comeaux) Well, thanks for being here, Janelle. Well, Alan, how about you? What does our audience need to know about you? (Alan Seivers) Well, again, thank you, Chris for having me. I currently serve as a strategic business advisor where I have the privilege of serving business owners and key leaders looking to improve cashflow profitability. Plan strategically, et cetera. Uh, you know, and everything that I do, I believe in improving the lives of these individuals by understanding their goals, removing any barriers that may get in their way. From a perspective, I've had over 25 years of direct experience in the hospice industry, uh, addressing these same I issues. Uh, I've, I've been through a lot of growth. I've been through a lot of heartache, but had the privilege of working through any barriers that, uh, we as a company, uh, had along with the industry. So, again, just a, a privilege to be on, on this, uh, podcast today. (Chris Comeaux) That's good. I bet you, Alan, you probably see patterns as well. Am I right about that? (Alan Seveirs) Very much. See a lot of patterns. (Chris Comeaux) You and I go way back. In fact, I think about is why I really wanted both of you, and I think we're gonna call today's show Diagnosis Hospice. Growing up as a kid, I remember my parents would always watch Diagnosis Murder, which was with Dick Van Dyke. And maybe a more kind of a, a, maybe a more timely example is the Knives Out, um, movie series. With, uh, Daniel Craig, and he's playing this brilliant kind of private investigator called Benoit Blanc or Bin Wa Blanc. I'm from Louisiana, I gotta say Bin Wa Blanc. Um, and he's just (Chris Comeaux) this brilliant. He sees the patterns and he sees almost like a Sherlock Holmes in a way. And I feel like both of you kind of do that. And a lot of my career is kind of being that bridge at my early career. Just some incredible nurses that were great mentors of mine. But the thing that always fascinated me is they want to put up almost like the Heisman that, oh, but I don't do financials, Chris, but, but yet, you look at data and you do look at patterns. And so that's what we're gonna talk about today, guys. So in terms of like diagnosis, hospice, our listeners are line level hospice and palliative care people, but hospice and palliated care leaders, but also board members. And so what I want today's podcast to be is kind of a gift to them about. What are the things that you've seen as doing a high level assessment? And we've had the privilege doing many assessments of programs now doing this work we do within tcn. So if you do that diagnosis from your ne, your unique perspective about the health of a hospice, what do you see from almost like a high, medium and low risk? And so I think you're each gonna have your own unique perspective. So Janelle, would you like to go first with that? (Janelle McCallum) Sure. So the framework I like to use is the quadruple aim because I think it really speaks to all the parts in the pie that are important for the health and wellbeing of an organization and hospice in particular, and palliative care. So if we think about the slice of the pie, that has to do with, I'm gonna start with the people, right? And that was the newest part of the pie that got added, which was how are our employees experiencing the work? And so when we look at employee engagement and experience, I feel like when we're assessing a hospice, what's the spirit of the place? And it's hard to have an objective measure about that, but you can tell. And so, and then there's a conversation about staffing pressures and caseloads. So that's really easy. That's pretty objective. What are the budgeted caseloads? What are the real caseloads? And when there's a big discrepancy between the two. Both are bad. If it's too low, it's not. It's not gonna work financially if it's too high. It's really a stressful piece and quality's going to suffer usually, and morale often suffers as well. I. Then we would also wanna look at turnover. Um, and turnover, as we know in this day and age, is super difficult and important. But some of that matters and sometimes you can see more turnover with certain leaders than others in certain departments. (Janelle McCallum) And then a another piece that has really been important lately is the balancing of accountability. And grace. Mm-hmm. And what I've seen in our hospice organizations, especially what tends to be in our legacy nonprofits is we have a lot of grace and I love that about us, but it also doesn't drive accountability. So there's that. Then if we look at the financial part, um, are we, um, improving our financial outcomes or at least making it so that we can live to serve another day? Are we relying on fundraising or do we have a good operating margin? And that's where clinical leaders have to know about the business of hospice. And how aware are the clinical leaders about ~F ~financial performance and targets? Do they understand the fabulous five? We call them labor pharmacy, DME, supplies and mileage, and do they understand the targets and do they have support from a financial leader? Um, and what's their fluency in financial matters? And then of course, staffing is always a really big issue. Is it clear to staff what the staffing grid is or the expectations? Um, I know Chris, you're gonna talk about the FTE to ADC ratio, so I'll leave that for you. But that's important for a clinical leader to know about and the percent of full-time and part-time staff is important to clinical leaders. ~Um, ~And gets really hard when you have a lot of part-time staff. So there's a lot on this financial pie that that has to do with clinical operations and that's where that revenue cycle management, what is that and how does that affect me as a clinical leader? A lot. And so that's even more, more of a place to push into than looking at admissions. What's our conversion rate? Are we tracking it? Number of referrals, admissions, and deaths per day. Looking at our average length of stay, our median length of stay, what kind of churn do we have on terms of patients coming in and going out? All of those are really important. So as I, as I've made this list, I'm thinking, man, no wonder it's ~um,~ complicated to be a clinical ~a clinical~ leader. And then, um, two more parts of the ply have to do with patient outcomes. And we're all really familiar in hospice with our H I S measures and our other ~H R Q P~ HQ R P measures. And so those are important for us to look at and they're objective, which is helpful. Um, the last one and one of the ones close to my heart are. Is the piece of the pie of the quadruple aim, which is the family experience. And so that's our caps measures, which drives our star ratings. So those would be. Some of the areas that I would look at to diagnose the health of the hospice. ------------------ (Ad for Delta Care Rx) Thank you to our TCN talks sponsor Delta Care Rx. Delta Care Rx is also the title sponsor for our May and November, 2023 leadership immersion courses. Delta Care Rx is primarily known as a national hospice PBM and Prescription mail order company. Delta Care Rx is a premier vendor of TCN and provides not only pharmaceutical care. But also niche software innovations that save their customers time, stress, and money. Thank you Delta Care Rx, for all the great work you do in end of life and serious illness care. ------------------- (Chris Comeaux) Just cuz some people may go to the quadruple aim. We, we use it so frequently, but just unpack that just for a second cuz Board member might go, what's the quadruple aim? (Janelle McCallum) So the quadruple aim actually started as the triple aim. Don Burwick, um, came up with that I believe and maybe his team at CMS and it has to do with what are the most important things that are driving healthcare and are going to. Create the best outcomes for everybody. So they have to do with improved patient outcomes, improved financial outcomes, improved family experience. And then the later one that was added was our improved employees experiences. So that's the quadruple aim, and it feels like if we're hitting on all four cylinders there, we are gonna meet our mission, our vision, and provide excellent care and love to our patients and families. (Chris Comeaux) And you said another acronym? H Q R P. (Janelle McCallum) Right, the Hospice Quality Reporting Plan Program. That's what it means. Cool. And there's a whole bunch of other acronyms inside of that. (Chris Comeaux) Good deal. Well, thank you Janelle. So I think we're gonna go to Alan a second. I'll maybe kind of segue it, thinking about this, like if I went to the doctor and had a major health crises, I think Alan's gonna kind of poke on some of those of we've gotta get the health crises. Chris Comeaux: And when I think of the quadruple aim, the quadruple aim is more of a ticket into the future. But if you don't have the immediacy, the financial health, it's really hard to focus on the quadri blame. Um, so with that, Alan, what would be the things you would look like? Look at diagnosis hospice. (Alan Seivers) Yeah, of course. I'm gonna look at everything from a finance perspective and, and what I would, um, remind everyone that. You know, so often as a financial leader, we just assume that the, that that leader is the one responsible for the financials, but that couldn't be further from the truth. Every person in the organization plays a key factor in the success, or hate to use the word failure, but in the success or failure of of their company. And as a financial leader, it's our responsibility to. To give them the story, uh, like Chris was saying to, you know, how do we stop the bleeding? If they don't know where we're bleeding, then how do they know where to begin? And I think at a high level, I think operating margin is probably the first place to go. Uh, I think looking at, uh, what a company's operating margin is, is so critical and so often we get in the habit of comparing ourself. To ourself from maybe the last two or three months. And I would caution people in doing that. There's nothing, it's okay to do that, but in the last two or three months, a lot could have changed. That caused the the business to go up or down just for that short time period. I think it's so important that we trend really every metric, not just financial metrics. I think every metric that we, that we manage, that we trend, and what I mean by that is, Let's say you wanna look at your financials on March the 31st of 2023, year to date, how does that compare to March, uh, 31st, 2022, 2021? Look at looking at it year over year. I think that really paints a, a great picture of how successful or not a company has been, but from an operating margin perspective. The, you know, right now the median from a benchmarking report is around 4.7 to 5% is the median 90th percentile is gonna be around 21%, and then 10 percentile is going to be at a loss of 18%. So there's the results all across the board and lots of people ~are,~ are, are dealing with that. The model I, I would. I would caution looking (Alan Seivers) at a model and letting that be the number you're trying to get to. I think the intent of what you wanna do with your operating margin is critical. You know, if you have this operating margin that's really, really on paper, very attractive, that could almost imply that you're not reinvesting in your business. (Alan Seivers) And, and so I would just be very intentional about your approach to the operating margin, if, if that makes sense. I hope it does, but I, I want you to ~be to~ know the operating margin that you're presenting or that you're achieving is one that makes sense for your business. One that's gonna help you grow into the future, one that's gonna give you great return on investment, things like that. So I think operating margin is probably the one I would look at first. Cash on hand I think is e extremely important. Uh, you know, you, you'd asked this question, if, if revenue drives up, we have no more money coming in. How long could you last? How long could you survive? You know, what does that runway look like before you run outta cash? So I think monitoring cash on hand is critical to the success of your, of your organization. And you'd love to be around 180 days to 270 days. At the very least, you want it to be growing again. How does that compare to last year? You know, last year if, if cash on hand was 90 and this year we're at 110, Paul, no, you may not be at that 180, but it's going in the right direction. So I think cash on hand is very critical. Along those same lines as account receivable days, basically, how long does it take you to collect the cash for all of the great services that you've provided and that, because here you have a set of financial statements, you have an income statement, and on paper you look like you're doing fantastic. But if you don't collect any of that cash, It's, it's all or not, and an ideal number there. You're going wanna be in that 45 to 60 range there. 45 to 55 is great. You know, 56 to 65 is tolerable. Anything above that you're gonna wanna look into and and see why I would also recommend. That, that folks would dig even a little deeper into their AR days. Maybe do it by payer category and follow what that trend may look like, because your AR days with Medicare should be much lower than Medicaid, typically takes them longer to to pay. So I would even drill it down just a little bit further, maybe at the next level, and look at payer category and see where that, uh, what, what that may look like. Also looking at the account receivable that's non-current. You know, if you have, if that percentage is growing over time, then again, obviously the longer the, the older the receivable, the less likely it is to collect that. So, so those are the areas that I would think operating margin being number one, cash on hand. (Alan Seivers) And AR days really kind of go hand in hand, but cash on hand and AR days being, um, very important to look at, at, at a high level. Then one thing that may not be necessarily finance driven, I would argue that anything we talk about is finance, financial related, but also too, I think it's so important that people look at referral source concentration. You know, if you only have one or two referral sources that are providing most of your referrals, I consider that high risk because as you know, (Alan Seivers) one service failure. Could be the reason why doors have to be shut. So I, I would also look at referral source, uh, concentration. So, uh, Chris, I think those are the ones that really jump out to me as I think of a, of a high level assessment. (Chris Comeaux) Good deal. Thank you. Those are great. Alan. So you've actually pro provoked a couple of thoughts on my part. Um, couple years ago as visiting with a friend graduated high school and several of us went off to college, but he went into the trade and his trade was actually surveying. And we were just talking about catching up on a bunch of things, and when I grew up in South Louisiana, my parents' front yard, we had one of these small little concrete pillars, probably about maybe three feet above the ground and it had a number on it. We ended up telling me that that was a benchmark and my financial mind kicked in and I'm like, Wait, what he said? Yeah. You know those concrete pillars that we grew up with, cuz we used to play football in the front yard at my house, cuz we used it as a obstacle course cuz we'd kind of knock each other into the concrete pillar. So it really was something I remembered. He goes, yeah, that's a benchmark. And I'm like, You mean? So tell me more. And he's like, so you, you find that, and then you have the plot. And the plot will tell you, we'll now go, um, 250 feet to the Northwest X degrees. And then basically you use that benchmark to plot the entire course. And now you understand, uh, the, the entire lay of the land. I'm like, that is brilliant because where I've grown up is the benchmark is you've gotta be to the benchmark. Actually, that's a much better analogy because it means as compared to what, so I love what you said about the margin. A because I, I think that that's a much better way to all of these measures. Doesn't mean you exact have to be at that number, but it's just like that concrete pillar compared to that then helps you make sense of the business. So, I'll use that as kind of a segue to a few I thought of. Janelle alluded to one, and we developed this one out in necessity cuz Janelle, I think you'd probably say we've seen very sophisticated hospices that measure a boatload of things and then hospices that are (Chris Comeaux) very unsophisticated and measure very few things and everything in between. So one that we ended up developing and now we've trended enough, is basically the average daily census divided by the FTEs. And this is one I could share the actual range. And so that bottom range is about 1.5. If you're about 1.5, when Alan talked about that operating margin, you're probably pretty close to breakeven. And then the upper scale seems to be about 2.5. And if you're above 2.5, you may be understaffed in really stretching your. Your staff and you might be hurting patient family care. So that's a beautiful kind of upper and lower control limit, dividing the average daily census by the FTEs. (Chris Comeaux) Um, and if you don't know what an FTE is, like you, if I'm working 10 hours a week, then I am basically, what is that? 20%? Um, and so if you're working, uh, 20 hours a week, you'd be 0.5 of an F T E. And if you're working 40 hours a week, you're one F t e. Basically one FTE is 2080 hours a year. So that's one that we bumped into. Now we've really start to use it in our work, and it's a quick diagnosis tool that then you can start pulling on that thread and see a lot of other things in that organization. The other that, um, just wanna put stress on what Alan said cuz the first thing we're trying to figure out when we look at an organization, just like when a really good nurse or clinician looks at the patient, you're trying to figure out what is the situation, how critical is the situation? Well, if that organization is losing, so let's say they're losing $10,000 a month, immediately I go to that balance sheet and if I see 1.2 million on the balance sheet as far as cash they have available. They've got 12 months runway, which means we've got 12 months to turn this thing around. Um, or at the end of 12 months, we're outta cash and it's game over. And those are the most critical situations. ~Um,~ In fact, I think that's probably about the worst critical situation we saw was the loss was really about 12 months. ~Um,~ In my career, I've seen actually much worse than that. That's how I got introduced to hospice. My second week on the job. I'm the first one to find out we didn't have enough money to make payroll and how we met payroll as a woman liquidated her estate, and that's how we met payroll. So I've come from the absolute worst critical situation. ~Um,~ and interestingly miraculously, we actually not only made it outta that situation as a well known thriving hospice today. Another thing I was thinking, ~um, ~Alan, Janelle is on the palliative care side cause we have a lot of programs now. ~Um,~ So I've reached out to our serious illness team and there are a couple things that they gave us. (Chris Comeaux) One that's a really kind of top level, ~um, ~diagnosis is the total loss cuz palliative care. In almost all cases we've seen loses money. It's a negative margin product, so if you divide that palliative care loss by the number of palliative care patients, ~um, ~we've seen a very interesting range there. And so I won't share that number, but that's a really good number to start with. Take your total palliative care loss divided by those patients served in your palliative care program, and that'll give you a, a really good initial measure. And then the hospice transition ratio. As a percentage of the caseload. So you have these amazing nurse practitioners, probably depending upon your model of palliative care, what percentage of that caseload is being transitioned to hospice? (Chris Comeaux) Cause most of the people we work with, palliative care is actually chassis to a hospice program. We tend to see about a seven to 10%. It's about seven to 10% of that caseload. Is consistently basically transitioning into hospice if you see it as a beautiful continuum of care, palliative care, and then transitioning into hospice. The next one was the percentage of the total palliative care discharges going to hospice. And generally you'd like to see about 50%, so total discharges. So patients coming in into palliative care, they're going somewhere. About 50% of those you want to see going into hospice. Then the length of stay in hospice from palliative care, we've seen a wide range on that one. So let's say your average is about 50 from your typical hospice. You'd like to see that length of stay from palliative care, so palliative care patients in the hospice program, at least at that. But ideally, you're seeing it be better because now you're further upstream and you're acting with that patient and family. And then the caseload per provider, ~um,~ generally see that to be about 85 to one 50. I know that's a wide range. And then the revenue per provider in most of the model that we've seen as nurse practitioners, physicians, ~um, ~and so how much revenue per provider that they're generating. ~Um, cuz ~That also obviously translates to your palliative care loss. So all of those I think, are some key measures that we would pay forward Janelle, Alan, any kind of final thoughts that that provoke for you guys? (Alan Seivers) ~No, I, ~ I would just say, um, again, that it's so important to, to, I think, look at it like you said, at a high level and, and even at the. At the organization level as well. You know, so often we get, um, so deep into the weeds, which is not a, not a bad thing, not necessarily a bad thing. You know, Janelle was talking about the, the Fab five. You know, you have to manage all of that, but really looking at the bigger picture, Of what's at stake and, and understanding those metrics. And it's one thing to see those metrics and I would encourage you to, to ask your financial leader, to ask your clinical leader, whoever that case may be. If you truly don't understand what a metric is and the impact that that has on the organization and the impact you have on that metric, I would encourage you to. Uh, to really dig deep and, and educate yourself on that. Cause again, like I said, at least from a financial perspective, every individual in the organization, every team member plays a factor in the success of a company financially. (Janelle McCallum) Alan, I couldn't agree more, and it, that was one of the things I wanted to say was how important it is to have a financial partner like you. As a clinical leader, any leader in the hospice and palliative care, so that there is a great relationship. There's ability to be supported and educated, so we all are syncing up on our role in the health of of the organization. And when I find that that's not happening, that's usually when there's a lot of, especially in the clinical side, people just don't understand and they, they just have no sense of, well, why can't we have raises? Why can't we have this? Why? Why do people have to pay room and board at the care center? I thought we were a nonprofit. I mean, there's this whole thing about inpatient units too, which is really important to think about. In terms of what's our mix look like and what's our staffing look like. And, um, again, having a, a really strong financial partner to help us understand that is, is super important. I had a couple more thoughts as we were going through. One is, and I don't know that I mentioned it, but the audits one of the thing to look at in terms of the health of the organization. Not that they, not that a t uh, hospice shouldn't have audits, cuz that's just our reality. Like we Yep. But. What is our plan and capacity to handle the audits timely and strategically and well, because that's like the future. ~Um,~ And the other thing is the, ~um, ~how important length of stay is and how we look at it. All the different ways that we look at length of (Janelle McCallum) stay. And that goes to your referral sources, Alan, that you talked about, but that's another really critical me measure too short is terrible. Too long can have its consequences. So it's, there's that sweet spot in there. (Chris Comeaux) Well said. What you guys have done great. The two analogies that occurred to me as we kind of wrap up is that, you know, if, ~um,~ if I'm involved in my partner or my spouse, significant other, and she's like, well, I want a million dollar home, and you're like, we can't afford that. Um, that's not a good situation. But yet that's pretty close to what happens in many of our, ~um, ~hospice palliative care programs throughout the nation. You've nailed it. You know, why can't we get raises? Why can't we do this? And then we have failed to educate as leaders of, well these are the business realities. Second analogy of the curse to me, and probably five years ago, I hated my annual physical cuz I had a horrible primary care physician and they just went like through all of these measures and like, so I don't know what to do about these things. So the real goal today was these are some key measures that you need to focus on. Now there's a whole nother world of how is our day-to-day translate as you keep unpeeling the onion on these. And our day-to-day decisions and actions and how they impact those. And of course, that's, that's where we love to be a great partner as TCN. So, Alan, Janelle, thank you so much. Appreciate the work that you do and your time today. (Chris Comeaux) And as we always do, we had a great quote that we all agreed upon. Um, so this one is from John Doer, who wrote a great book. I think it's, um, I can't, oh, measure what matters. That's it. And so, but here's this quote. Not everything that can be counted counts, and not everything that counts can be counted by John Doer. Thanks for listening to TCNtalks.