Accretive Health

Peter P. Csapo

Financial Integrity

Editors’ Note

Prior to joining Accretive Health, Peter Csapo was Chief Financial Officer and Area Senior Vice President at VHA Inc. Csapo was also the former Chief Financial Officer and Vice President of Customer Operations at McKesson Health Solutions. During his 13-year tenure at McKesson, he advanced through multiple operational and financial leadership roles at both the corporate and division levels. Csapo is a graduate of the University of Wisconsin at Madison and received his Certified Public Accountant certificate from the State of Illinois.

When you came into this role, what steps did you take to ensure that financial controls are in place to put the company on the path toward managing the growth ahead?

When I arrived, the immediate focus was to complete the restatement, which we finished at the end of 2014. We are still in the process of remediating our control environment.

In our SEC filings, we were extremely transparent in outlining the plan we have in place to enhance our control environment. We have achieved good progress against that plan. We brought in a new team to not only assist with addressing the control issues but to upgrade skills and enhance our capabilities in the accounting, finance, compliance, risk management, and audit organizations.

How critical are your efforts in enrolling your business leaders in the company’s strategy?

As a CFO, our number-one priority is the fiduciary responsibility to ensure the integrity of the financial numbers. However, when the right teams, controls, policies, and procedures are put in place, the infrastructure enables one to spend less time with greater confidence that the numbers are accurate.

This allows more time for building and developing our team and communicating with stakeholders.

The ultimate goal is to get to the point of adding value by driving strategic decision-making and building peer relationships across the management team. I expect my teams to be partners with the businesses they support, and gain their confidence over time becoming decision makers in those businesses, not just a support staff function.

How have you worked to ensure that Wall Street and the financial community understand the controls and stability of the numbers?

We have been active in educating investors on our non-GAAP accounting measures and how they tie to our GAAP financials. Due to the complexity of our business and performance-based nature of our customer contracts, we believe the non-GAAP financials provide a better view of our operational and business performance in terms of our cash generation ability.

When we first came out after the restatement, and after having been quiet for a while, we had to educate outside parties on these non-GAAP measures, why we selected them, why we think they are important, and how they should interpret them. We also provided guidance for the upcoming fiscal year.

We are being as transparent as possible to rebuild our credibility with the investor community.

What growth opportunities do you see for the company and how vital is this company in terms of the status of healthcare today?

There are plenty of revenue cycle companies out there, but there are only a few with true scale. We are one of them. Our model is very distinct because of how we tackle the problem. As reimbursement models change in the coming years, there is an enormous opportunity for hospitals to outsource this function. Hospitals do not want to invest a lot into figuring out how they are going to ride out the changes in reimbursements. Why not give it to a revenue cycle vendor that is solely focused on their financial results?

We have a great market opportunity because we have a partnership approach. Also, our technology integrates with the large platforms in hospitals. The people we hire have outstanding skills for identifying opportunities, defect management, and driving change management. We view the revenue cycle processes in hospitals similar to a manufacturing floor that has defects. In the assembly line, we work those defects out of the process using process redesign, technology, analytics, management oversight, Lean Six Sigma, and focused operational alignment to key metrics.

We also have an internal process that feeds performance improvement and functionality enhancements from our employees at customer sites to our product management experts. They prioritize and deliver technical specifications to our technology experts, who incorporate technology enhancements, or new functionality, that are quickly deployed to the field. It is a constant feedback loop.

Reimbursement will continue changing over the next three to five years. The question is, who do hospitals want handling their revenue cycle challenges? That would be someone who is keenly focused on the problems, with fresh solutions. This is especially important given the uncertainty of how the shift from fee-for-service to value-based reimbursement is going to play out. They should want a trusted partner who has built a model on thinking, solving, and deploying processes and technology to create results. •