Strong medicine: rethinking the PFS director's role - patient financial services - includes related article on accounts receivable management

Healthcare Financial Management, August, 1991 by Carol Bradford, Arnold Simoni, Dudley Medlock

In one case, Kathy Lawrence, PFS director at the University of California at Davis Medical Center, feels that her background in several functional areas give her a broader perspective of the hospital and her own department. Although Harry describes Lawrence's experience as "a happy accident" rather than a planned progression of departmental rotations, she points to broad-based knowledge that can result from those experiences as fundamental to upgrading the role of PFS directors.

Lawrence, who previously worked as an administrative analyst in finance and patient accounting, learned about procedures and functions in nursing, the emergency department, medical clinics, and ancillary departments through those positions. As a budget analyst and senior accountant, she learned how rates are developed and costs are determined. Lawrence feels those positions gave her an understanding of revenue and expense relationships, work loads, and productivity analysis.

When Lawrence became managed care contracts manager, she learned to assist in negotiations and information analysis. The experience underscored the cause-and-effect relationship between patient accounting and other hospital departments, she said.

Later, in becoming assistant director of finance for PFS and having responsibility for registration, admissions, billing, and collection, she draws heavily on those experiences. "I don't know how I could succeed without this background," Lawrence said.

Where to look

It seems only logical that a hospital in the midst of searching for a new PFS director would look to people holding that position at other hospitals. Because many hospitals face similar cash flow difficulties brought on by receivables problems, however, some facilities may need to search in other industries when recruiting.

If hospitals accept the premise that cash management expertise is not necessarily restricted to hospital cash management, then they are given plenty of latitude for recruiting in other industries. Hospital-specific training can involve applicable business law, government regulations, reimbursement, and billing requirements, including government programs, private or group insurance, and managed care. Finding a person with the right management skills may be more important than finding a person with hospital experience.

In fact, recruiting outside the healthcare industry for key management positions, while not widely practiced, is not a new approach. In the early to mid-1980s, many hospitals looked to other service industries to fill newly created marketing positions.

Clay Taft, vice president for marketing and planning at Mercy San Juan Hospital in Carmichael, Calif., was vice president of a major California bank before joining the hospital's staff one and a half years ago. "The discipline remains the same," he said, "only the language has changed." He believes that, after Mercy San Juan considered several candidates with healthcare experience, the hospital's chief executive officer chose him for the position because his banking experience meant that he had survived rapid change and cultural evolution, much like changes occurring in health care.