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SITUATION OVERVIEW

In early November 2009, at the conclusion of an in-depth operational and management review of Jackson Health System (JHS), Qorval presented JHS leaders with financial, operational and organizational findings that precisely identified serious deficiencies that threatened the continued operation of the hospital system. Qorval provided explicit recommendations for the successful turnaround of JHS. Qorval was able to maneuver through a very large and complex health system in the matter of a few months and make tangible recommendations regarding crucial steps required to resuscitate a critical institution to Miami-Dade county residents on the brink of failure. Since release of the report, many months-and millions of dollars in losses-have passed while limited, if any, change has been enacted to ensure the long term viability of JHS.

KEY FINDING (page number refers to full Qorval report with link available below)

JHS was hemorrhaging money. Without immediate, top-to-bottom financial and operational restructuring, JHS was headed toward disaster.

Qorval projected a possible 2010 deficit of $142 million – extremely close to recently published numbers by JHS (page 7).

Qorval predicted actual monthly operating losses were between $11.7 and $17.7 million as opposed to the approximate $5.0 million being reported by JHS at that time – (page 8). Recent JHS reporting has verified Qorval’s figure as accurate.

Qorval Recommendation

• Approximately $100 million in costs or expenditures were identified as suitable for immediate cut (1400 employees). JHS recently announced a significant headcount reduction and closure of Jackson North and South. Qorval Report Page(s): 11
• The finance department was inadequate with near term replacement recommended. CFO was recently replaced. Qorval Report Page(s): 15
• Revenue Cycle (aka accounts receivable) is badly broken and the entire department should be realigned. Additionally, given the critical nature and poor performance, it was recommended Revenue Cycle board oversight be increased. $100mm+ of bad debt was recently acknowledged. Qorval Report Page(s): 19 and 39
• The $100mm Jackson South construction should be halted immediately as it will likely result in increased operating losses. Jackson South closure was recently announced. Qorval Report Page(s): 34
• Establish a twice a year payroll audit via employees picking up live checks in person. Establish a twice a year payroll audit via employees picking up live checks in person. Qorval Report Page(s): 41

Numerous other tangible recommendations regarding strategy, leadership, and cost cutting were provided with a goal of restoring faith and viability into the JHS.

Click HERE to read our full report and recommendations.

CONCLUSION

The challenge that JHS and the Miami-Dade community faces is how to take the national treasure that is Jackson Memorial Hospital and University of Miami School of Medicine and turn it into an economic and care-providing model that works for the community. To regain its once-venerable reputation and continue the provision of vitally needed lifesaving care, JHS needs to break the mold, and reinvent themselves as an organization that matches a passion for public health with private sector accountability.

Want to know more? Click HERE to read a recent Miami Herald Editorial by Qorval Sr. Managing Partner James R. Malone.