Answer: Build the proposal around the projected gap between professional collections and the expense of staffing the requested anesthesia services. A healthcare valuation adviser uses that framework to explain a coverage subsidy. Make the coverage requirements and staffing assumptions explicit. Address requested availability and patient activity separately, with the distinction between standby capacity and avoidable inefficiency left for discussion rather than assumed from a quiet location alone.
The short answer
Start with the staffing expense and projected professional collections. A practice management executive identifies provider costs as anesthesia's largest single expense and says collections must cover provider salaries, benefits, and overhead.
The same executive says subsidy negotiations require practices to disclose and justify coverage, call requirements, staffing, and provider departures. Those assumptions explain the staffing expense behind the requested subsidy.
For the locations that stop running earlier, frame the discussion around hospital service requirements and surgical volume. A hospital advisory consultant reports that a hospital assessment examined staffing needs in relation to both. The question is how the requested availability relates to that activity and the staffing assumptions.
What usually goes wrong
A practice management executive says hospital administrators want continuous anesthesia availability but resist paying providers for time without patient activity. That tension belongs in the discussion of the locations that remain available after activity declines. Requested availability and patient activity are separate parts of that conversation.
Compensation is only part of the financial comparison. A hospital advisory consultant reports that an assessment also examined revenue cycle performance, payer challenges, overhead, and operating expenses. The proposal's revenue discussion therefore needs the same attention as its staffing discussion.
Another practice management executive says hospitals seek greater accountability and collaboration as their subsidy support grows. Explain the assumptions behind the requested support so the discussion can address coverage, staffing, and collections together.
What a veteran checks first
- Coverage and call requirements. A practice management executive identifies both as assumptions that require disclosure and justification.
- Staffing needs in relation to hospital service requirements and surgical volume. A hospital advisory consultant included these relationships in a subsidy assessment.
- Provider salaries and benefits. A practice management executive says collections must cover these expenses along with overhead.
- Provider departures and their relationship to staffing assumptions. The same executive includes departures in the negotiation discussion.
- Professional collections, revenue cycle performance, and payer challenges. A healthcare valuation adviser places collections in the subsidy calculation, and a hospital advisory consultant examined revenue performance and payer challenges.
- Overhead and operating expenses. The hospital advisory consultant examined these alongside compensation.
How the financial pieces fit
A healthcare valuation adviser defines the subsidy around a projected shortfall: the expense of staffing anesthesia services compared with professional collections. Keep that relationship clear throughout the proposal.
A practice management executive identifies provider costs as the largest single anesthesia expense. The executive also calls for an explanation of coverage, call requirements, staffing, and provider departures during negotiations. Together, those items connect the requested coverage to the staffing expense.
A hospital advisory consultant's assessment considered staffing needs, service requirements, surgical volume, revenue cycle performance, payer challenges, compensation, overhead, and operating expenses. Use those categories to organize the discussion. For quieter locations, keep the focus on what availability the hospital requests and how staffing relates to service requirements and surgical volume. Whether that capacity represents standby or avoidable inefficiency remains a question to resolve through those assumptions.
Questions to bring to the partner meeting
- What coverage and call requirements underlie the staffing assumptions?
- How does the staffing assessment relate hospital service requirements to surgical volume?
- What assumptions underlie projected professional collections, revenue cycle performance, and payer challenges?
- How are salaries, benefits, overhead, and operating expenses represented in the projected shortfall?
- What requested availability remains when patient activity declines, and how is that reflected in the staffing assumptions?
Sources
- Jody Locke, MA
- Neal D. Barker, HSG Advisors
- Tony Mira, President and CEO
- VMG Health
