OHSU

Outsource Or Insource - OHSU Picks The Latter

02/14/06  Portland, Ore.

When big changes were needed, OHSU chose to retrain and retool, with great success.

With a $15 million billing backlog, low morale and collections far below industry standards, OHSU's Patient Billing Services Department had a dilemma. Faced with having their work outsourced and their jobs eliminated, employees rallied behind their manager, partnering with union representatives and their employer to bid for the work. The end result was a unique insourcing effort that now, two years later, is an unequivocal success.

Despite bids from 10 outsourcing firms, OHSU saw the potential in the five-pound proposal submitted by the American Federation of State, County and Municipal Employees, which outlined the union's strategies to resolve the personnel challenges the department faced and resolve the backlog of patient billing.

This unusual strategy led to savings for OHSU, and benefits for employees including training, national certification and bonuses when goals are met. In fiscal year 2005 the department collected $57 million more than it had the previous year - an increase of 11 percent. The average number of days an account takes to work through the department is now 46, much lower than the industry standard of 50 to 60 days. And to date, 19 employees have passed the Certified Patient Account Technician exam, with 41 more employees training to take the test this year.

 "It's been a long road and a lot of work, but well worth the effort," said Terri Meier, director of Revenue Cycle Operations. "Our continued success directly depends on the participation of everyone."

Union members and leaders have taken a more involved role in the department after establishing a policy-making coalition of union leaders and staff, and PBS employees. AFSCME contributed $10,000 to cross train workers and hired a facilitator to help with team building and morale. Leaders set quantifiable benchmarks and employees are rewarded with monthly bonuses when the whole unit meets the benchmarks. OHSU is so pleased with the outcome that it has approached the union about making similar changes in other departments.

 "I believe a major reason for the improvement is that we trained all the PBS employees with the tools to evaluate their work flow and improve the work process," said Frank Vehafric, Oregon AFSCME council representative.

Philip Curtis, an OHSU facilities building coordinator and president of AFSCME Local 328, sees the changes as empowering to employees and the right choice for all concerned. "Our jobs are constantly changing and those doing hands-on work often have the best insight into how to negotiate through those changes successfully. This effort shows that outsourcing is not necessarily the most economical or effective way to adapt and that using the talented employees we have, giving them the tools to change, can do the job."

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