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Webinar on Benchmarking

Webinar on Benchmarking






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  • What philosophies are most important?
  • What philosophies are most important?
  • Manage What Can be ControlledManage Exposure to What Can’t be ControlledProjections, Forecasts and Assumptions Require Trust/FaithHistorical Operating Performance is FactOPERATING PERFORMANCE LEADS THE WAY

Webinar on Benchmarking Webinar on Benchmarking Presentation Transcript

  • December 13, 2012Benchmarking Strategies:Operate Smarter, MoreEfficientlyMark J. Ross, CPAPartner and Practice Leader,Senior Living Services Practice570.820.0311Mark.Ross@ParenteBeard.com
  • Operating Pressures • Economy / Housing market • Occupancy • Operating costs • Medicaid and Medicare reimbursement • Aging physical plants • Technology • Regulatory oversight • Health care reform 1
  • Benchmarking 2
  • The Economy – What Does the Future Hold? 3
  • Positioning Your Senior Living Organization Financial Stability Operational Efficiency Quality 4
  • Focus on Core Operations • Focus on revenue growth • Re-evaluate the cost and efficiency of delivery systems • “Team” approach - Empower your team to lead • Challenge the status quo 5
  • Focus on Core Operations • Top down review of organizational structure / redundancies • Zero based budgeting • Establish realistic revenue and cost goals • Adapt to change • Benchmark 6
  • Benchmarking• Benchmarking is a process that assists organizations in the measurement of key financial reporting / operating drivers• Generally done for “internal” purposes only; may be shared externally in certain circumstances 7
  • Benchmarking• Can be performed internally or externally (by outside auditors, consultants, etc.)• Frequency of formal benchmarking is an organization-specific decision – Organizations should be proactive when it comes to benchmarking / analyzing financial performance – Don’t wait until you “need” to perform benchmarking analysis 8
  • Benefits of Using Benchmarks• Benchmarks provide high level direction for Management (including Department Directors) – Identify outliers • “Low hanging fruit” – Drives increases accountability – Enhances interim reporting • Dashboard reports 9
  • Benefits of Using Benchmarks• Enhances long range planning process – Increased understanding of strengths and weaknesses – Focuses effort on improvement / Best practices 10
  • Challenges of Using Benchmarks• Comparisons among organizations may be distorted by unique attributes of each organization – Contract type (A, B, C, etc.) – Unit complement – Number of operating locations – Capital structure – Operating philosophies 11
  • Challenges of Using Benchmarks• Access to quality published information• Financial statement benchmarks may vary due to variations in financial reporting treatments• Variances may be explained away too easily – There is a “story” behind every number• Viewed as purely economic initiative – What is the impact on quality of care? 12
  • Benchmarks – Where are they?• Medicaid / Medicare cost reports• Centers for Medicare & Medicaid Services• American Health Care Association• State of Senior Housing• National Association for Home Care & Hospice 13
  • Benchmarks – Where are they?• CARF-CCAC Financial Ratios & Trend Analysis• Rating agencies• Peer group (associations, etc.) surveys• Proprietary benchmarks 14
  • In summary, it’s all about…… 15
  • Achieving Financial Strength• Revenue Enhancement• Cost Containment• Programmatic or Strategic Changes• Call it what you like… 16
  • Achieving Financial Strength “Thinking does not matter if nothing happens…” Larry Bossidy, retired CEO of Honeywell. Execution: The Discipline of Getting Things Done. New York: Cown Business, 2002. 17