On day two of the Healthcare Financial Management Associations Annual National Institute in San Diego, economist James Gilmore fired up the approximately 4,500 attendees with a talk called "The Experience Economy: Maximizing the Value of Healthcare."
Gilmores economic theory centers on the assumption that we have moved far beyond the agrarian economy, the industrial economy and even the service economy that marked the last century. Most people in healthcare probably will jump to the conclusion that it is a service economy that they serve, but a lot of industries have evolved to an even higher plane: the experience economy.
For example, according to Gilmore, kids birthday parties are far more elaborate than the home-based birthday cake and ice cream parties that baby boomers grew up on. People spend money for the experience in an experience economy; in other words for time. Using coffee as an example to illustrate, Gilmore explained that coffee is a commodity and an example of an agrarian economy, Maxwell House typifies the industrial economy, a garden variety cup of coffee exemplifies the service economy and the Starbucks experience is the paragon of an experience economy.
People are not spending money on goods or activities that they once did for themselves as they would in industrial and service economies, they are paying explicitly for time, he said. You are what you charge for.
It was a gimmicky talk flush with sound bites. He ended it by unveiling the ultimate economy, one even more evolved than the experience economy: the transformational economy. To get a better idea of what the transformational economy is about, he recommended that people read his book (no doubt an experience rather than a commodity) but he suggested that the transformational economy has something to do with charging people only when a sustained achievement has been accomplished.
In healthcare, that would translate to only charging patients when a specific goal has been achieved. One could conjecture that charging a patient only if a bypass surgery clears the arteries of plaque for a sustained period of time might describe a transformational economy but it was a little fuzzy without having read the book. When Gilmore finished the prepared portion of his speech, one man in the audience promptly asked, How do we change the colonoscopy procedure into an experience?
These sound bites came to mind when we toured the exhibit hall of 360 vendors. Healthcare financial management is such that anyone would be hard-pressed to find any vendor on the floor selling a commodity that could actually be felt and touched. In fact, most people would be hard-pressed to find any vendor on the floor selling something that is readily understandable in 25 words or less. Vendors were hawking mind-numbing, hard-to-grasp concepts like revenue cycle management, back-office processing and funds movement, strategic planning software (although the software doesnt come on a disk per se), and integrated IT solutions.
However, in an apparent effort to entice people to their booths, vendors could not stand on the experience of their services alone. Remarkably, nearly every single one of them were giving away free giftspens, squeeze balls, flash drives, T-shirts, caps, pies, popcorn, bouncing balls, mouse pads, tote bags, and, yes, of course, even the ubiquitous Starbucks coffee, complete with a real live Starbucks barista.
The selection of freebies was impressive and only seemed to be limited by the imagination of each particular vendor. In addition, many if not most of the vendors were also holding raffles, which were thinly veiled attempts to collect business cards from peoplefor what purpose do you suppose?
It is not clear what Gilmore would make of all of this but attendees were obviously impressed and happily cruising the exhibit floor as eagerly and hopefully as if it were a beach boardwalk in Juneonly on this boardwalk everything is free. Bill Sweeney of Chesapeake System Solutions was standing over an impressive cache of Pez dispensers topped with cars. This was Chesapeakes first HFMA, he said, but everyone knows Chesapeake for Pez.
Chesapeake sells software that automates accounting and treasury functions, he explained. Meanwhile, a woman came by looking for a Pez dispenser topped with a Volkswagen for her husband. She admitted that it was an improbable request as Volkswagen tends to be very proprietary with its image. Sweeney obligingly went through his unopened boxes of Pez and came up empty. She moved on.
GE Asset Management had hired a card magician and was giving out oblong decks of playing cards in oblong blue plastic cases. Card magician James Kellogg Jr., also a hypnotist although he wouldnt fess up to hypnotizing HFMA attendees, admitted that after two days, he had absorbed about as much about asset management from GE as GE had figured out how he did his card tricks, which is to say nothing.
Way out on the most extreme edge of the exhibition hall, Bill Munn, senior account executive with HighCotton in Birmingham, Ala., was looking lonely but exceedingly good natured at the end of day one. Talk about niches, HighCotton simply offers what are essentially postal services, sending out things like billing statements and collection letters on behalf of hospitals. HighCotton, a Southern term meaning bumper crop, he explained, wont get involved in actual collections. The company makes its money on volume, using expensive technology to sort mail and filter addresses, he said. High volume also allows HighCotton to harness some purchasing power to achieve discounts on paper, printing supplies and even postage.
Were considered one of the Great Eight in the industry, Munn said, which prompted the questionjust how many are there in the industry? He said there are so many that the industry even has its own trade magazine called Collection Advisor. While he was talking, two people wearing Citigroup polo shirts came up to the booth behind Munns back, making away with two of the free Chapsticks he was offering. Told about this, he snickered, They probably are bankers.
Emdeon Corp. was the company offering a bonanza of swag, including free Starbucks, lighted bouncing balls and tote bags. In addition, like a timeshare offer, anyone taking the time to demo any of Emdeons products offering a full sweep of patient-billing services received a $10 Shell gas card and became eligible for a drawing for a $500 gas card.
Tommy Lewis, vice president of Emdeons solutions marketing, said it had been standing-room-only the first morning of the exhibition but then in the afternoon Everyone went to the beach. As big and central as the Emdeon booth was at HFMA, Lewis said the companys booth at the Healthcare Information and Management Systems Society was the twice the size. You have to have some footprint to be considered, he explained. Still, HFMA was in his view the more important show because Youve got decisionmakers on the floor now, Lewis said. This is what I call a target-rich environment.
Tell that to Nancy Hirschl, president of Hirschl and Associates, a Laguna Niguel, Calif.-based revenue recovery firm. Hirschl and Paul Belton, vice president of corporate compliance at Sharp HealthCare in San Diego, were about to start their educational session at 2:30 p.m. when a buzz began among the 100 or so attendees who trekked across the massive San Diego Convention Center to hear what Hirschl and Belton had to say. The buzz began when attendees began passing down the session handout. Wait a minute, the attendees realized, this wasnt the session on late-breaking finance and accounting developmentsso secret and late-breaking that the subject matter wasnt even included in the program guide. Its a session on RACS & Take-Backs: Strategies for Dealing With Recovery Audit Contractors and Medicares Payment Error Program.
The buzz and chair-squirming got so loud that Belton politely asked the crowd what session they were expecting to hear. They collectively told him. He said, wrong topic. All but a dozen disappointed and slightly annoyed CFOs got up and raced into the convention hallway. One shouted out where he thought the desired session was located. Another responded that it was on the other side of the convention center.
The mob of CFOs groaned and murmured until one of them said, Hey, look, Sarbanes-Oxley! Next to the RACS and Take Backs session was one entitled, Evolving Best Practices Under Sarbanes-Oxley.
At least 50 members of the RACS mob rushed over, instantly doubling the number of CFOs who were already seated and ready to hear about 404 regulations and Statement on Auditing Standards No. 112, or SAS 112. Presenters William Hannah and Mark Higdon, both partners with KPMG, beamed with pride, apparently believing they were soon to be the hit of the HFMA Annual National Institute. Hannah shouted, Lock the doors. Were going to be here until 6 p.m.! Were not sure what happened to the balance of the RACS mob. We hear some made it to the last 15 minutes of PCCP Accelerated: Mastering Appeal, Dispute and Prompt Payment Laws.