Warbird Delivers Rapid Revenue Cycle Turnaround for Independent Critical Access Hospital
As a California community’s primary healthcare provider – and county’s sole emergency department – a 34-bed Critical Access Hospital is vital for the area’s health and well-being.
The hospital has remained independently owned and operated for more than 70 years. That local control has granted its team the autonomy to wholly – and successfully – concentrate on meeting the needs and expectations of thousands of community members each year.
However, the facility has lacked the resources for robust business operations, which eroded its long-term viability. Many hospitals across the United States, finding themselves in similar situations, have sought partnership and ownership agreements with larger systems and organizations that can subsidize administrative work, but in turn, could cede the facility’s focus on community benefit.
The Critical Access Hospital in California was determined to remain independent, but it faced mounting financial pressure, with operating losses exceeding $7.5 million, accounts receivable (AR) languishing for months and unbilled/Discharged Not Final Billed (DNFB) claims tied up with millions in potential cash.
Hospital leadership, though, found a path forward.
By turning to Warbird Healthcare Advisors, they were able to work with our expert practitioners to stabilize operations, improve collections and lay a foundation for sustainability – without loosening their community-focused mission.
Challenge
Bottom-Line Pressure: The hospital experienced a $7.6 million operating loss in one fiscal year and projected another $6.4 million loss for the following year.
Cash Flow Strain: Patient collections lagged, and existing vendor processes lacked efficiency and effectiveness, which left thousands of claims unbilled or denied.
High AR Aging: More than 57% of AR stagnated for more than 180 days, much of it self-pay.
Large DNFB Backlog: More than $1.3 million in revenue sat unbilled, due to documentation gaps, coding delays and workflow inefficiencies.
Warbird’s Approach
Warbird provided the support the hospital needed – without sacrificing its independent operations. Warbird rapidly deployed a Revenue Cycle Optimization team to comprehensively lead the hospital's revenue operations, supported by financial advisory services.
Key actions included:
Aggressive cleanup of legacy AR, with rebilling aged claims and writing off fully reserved balances to create a realistic AR representation
Collaboration with clinical and administrative teams to address upstream registration and documentation errors
DNFB reduction through process redesign, documentation improvements and coding support
Implementation of Key Performance Indicators (KPIs) in denial tracking and accountability tools
Rapid deployment of coding, billing and credentialing support
Results
Lowered AR
Actively managed AR to eliminate 17.6% of the 0-90 day backlog within the first three months.
AR cleanup reduced backlog of unworked claims, particularly those with balances past 300 days.
Hundreds of previously unsubmitted claims were identified and pushed through payors.
Reduced DNFB
Within 45 days, DNFB dropped from $1.388 million to $488,000 (65% reduction).
At 90 days, DNFB was further reduced to $323,000 (77% reduction).
Pre-2025 clinic backlog was cut by more than 70%.
Accelerated Cash
Average monthly cash collections reached $1.8 million, totaling 103% of net patient revenue.
Clean claim submission stabilized above 95%, reducing rework and accelerating payments.
Warbird operations made significant recoveries from previously unpaid or unbilled accounts.
Combined with expense reductions and revenue enhancements, the hospital was able to improve its bottom line, with Warbird initiatives contributing an estimated $2 million annual financial impact.
Conclusion
Through Warbird’s hands-on leadership, immediate impact and collaborative execution, the hospital rapidly stabilized its revenue cycle: AR improved, DNFB dropped by more than 75% and cash collections accelerated to record levels. Combined with the hospital’s overarching economic recovery plan, these operational wins directly positioned the hospital for a sustainable financial future.
Moreover, the encompassing solution of outsourced revenue operations has given the hospital the foundations it needs to remain independent. With Warbird’s revenue and financial advisory services, our experts affected significant bottom-line improvement – while the hospital’s team members remain committed to the community they serve.
