For most health and human service provider organizations, the advent of the crisis caused by the coronavirus has meant declining revenue. Forty percent of hospitals have lost half their revenue, with non-federal hospitals looking at a $161.4 billion loss in revenue between March and June (see Hospitals And Health Systems Face Unprecedented Financial Pressures Due To COVID-19). Seventy percent of primary care practices have lost significant consumer volume and half are looking at their last month of operating cash, while 68% of intellectual and developmental disabilities (I/DD) service provider organizations have lost 32% of revenue and 62% of behavioral health provider organizations have closed at least one program (see How To Increase Revenue In The Midst Of Crisis).
These revenue declines mean losses and cash flow problems. Losses are mounting, as are layoffs (see Mississippi Hospital Lays Off 250 To Offset COVID-19 Losses, UMMC Lays Off Hundreds Amid Pandemic. Other Hospitals Struggling. Now What?, and Coronavirus In Texas: Baylor Scott & White To Lay Off 1,200 Employees) and bankruptcies (see Quorum Health Faces Bankruptcy As COVID-19 Bears Down, Greene Memorial Hospital Stops Operations; Levies Expected To Expire, and Easton Hospital Notifies State Of 694 Layoffs, Possible Closure By End Of June If Sale Collapses).
As a result, executive teams are looking for ways to stretch their cash and reduce their expenses (see How To Improve Your Cash Management Program – The Five Steps To Manage Cash More Aggressively). On the other side of the equation are initiatives to slow revenue losses (see Going ‘Virtual’ For Revenue Generation: Assuring Consumers & Referral Sources Can Find You, and Aggressive Business Development Strategies – Adding To The Top Line With Breakthrough Services – An Overview).
One big challenge for executive teams trying to stabilize revenues is that traditional referral channels are running dry as they deal with the effects of the pandemic. No more visiting primary care physicians, judges, probation officers, educational consultants, and other sources of referrals. Typical education and event venues are closed.
So, how do you generate new referrals during this crisis? That was the focus of yesterday’s executive web briefing, Increasing Your Service Volume – Creating A Referral Development Crisis Plan, by my colleague Richard Louis. Mr. Louis’ approach to referral generation—particularly during this crisis—has three key components: referral source education, marketing and outreach, and payer needs assessment.
Referral Source Education—Many provider organizations have made significant changes in programming and safety procedures over the past eight weeks. But how would referral sources know? It’s important to keep key referral sources up to date on which programs and services are no longer available or have limited capacity; which sites are closed to in-person visits; how consumer assessments and intake are effected; what changes have been made to business hours and volume of appointments; new rules for social distancing; and whether health and safety screenings are offered. Consumers considering health care services at this time want to know about “the details,” like quick access to care, telehealth for screening and intake, temperature checks during in-person visits, and use of personal protective equipment by staff.
Mr. Louis explained, “Referral sources need to be informed and updated on any changes to your referral process, programs and services resulting from program closures, downsizing, or workforce reductions. The key is to develop a message that says to referral agencies and key contacts that you are open for business and can keep consumers and staff safe. They want to be reassured that you have implemented all coronavirus precautions.”
Marketing & Outreach—Proactive outreach and marketing can help provider organizations recapture market share lost during the pandemic, but an investment in developing electronic communication materials is required, along with an online presence that allows your organization to conduct online outreach, distribute digital collateral, and strengthen virtual referral relationships. The focus needs to be on all things digital. Now is the time to assess whether your website, and any related social media campaigns, are effective in the current environment.
Mr. Louis explained, “Getting your message out as soon and as often as possible is important to restarting referrals. Schedule online meetings and get creative with options like virtual tours to demonstrate your capacity and accessibility of services. Remember that referral sources are looking for comprehensive program information online, availability of virtual screening and assessment, online scheduling for appointments, and online portals for making referrals.”
Payer Needs Assessment—A crisis is a time when the needs of consumers and referral sources are likely to change. Now is the time to have conversations with health plans and state/county agencies. Their managers are eager to support provider organizations to keep their networks intact and remain responsive to the consumer’s need for services. Mr. Louis suggests conducting a payer crisis needs assessment to reestablish formal referral pathways, review relaxation in telehealth provisions, request contract rate increases, and explore contract expansion opportunities.
Some typical payer concerns right now include limited consumer access to assessment and treatment because of pandemic closures and downsizing; the slow transition to telehealth; and increased utilization of more expensive higher levels of care because of disruption in treatment and case management for complex populations. The key to crisis referral development is to understand those changing concerns and develop the service capacity to address them. Don’t hesitate to ask if there have been any provider organization closures, new service needs, or changing priority populations to be served. It is safe to assume that the change in customer needs will mean that services must be delivered differently.
Mr. Louis said that the most common objection he gets to crisis referral development initiatives is that it “costs money” at a time of declining revenue. But executives need to view this as an investment in reviving business and keeping competitors at bay.
For a deep dive into Mr. Louis’ session, check out, Increasing Your Service Volume – Creating A Referral Development Crisis Plan. And for more on business development and referral marketing, check out these resources from The OPEN MINDS Industry Library:
- Improving The ROI Of Your Payer Referral Marketing Program
- Want More Referrals? Step Up Your Web Marketing Game
- Optimize Your Residential Referrals: Best Practices In Referral Marketing & Development
- How To Increase Revenue In The Midst Of Crisis
- The Challenge Of Referral Generation In The New Paradigm Of Integrated Care
- You Operate Virtually, You Serve Virtually, But Are You Marketing Virtually?
- Web Briefing: Strategic Planning For Sustainability
- A Chaotic Environment Demands Fluid Strategic Planning
- How Are You Positioning Your Organization For The Changing Market?
- Going ‘Virtual’ For Revenue Generation: Assuring Consumers & Referral Sources Can Find You
For more on managing a business during a crisis, join OPEN MINDS Vice President Tim Pisula on June 23 for his webinar, Web Briefing: Options To Secure Additional Financing.