CFOs kick off HFMA's annual conference by addressing the financial challenges ahead

From left, CFOs Elizabeth C. Foshage of Ascension Health, James Lee of Multicare Health System, Susan Nelson of MedStar Health and Bill Rutherford of HCA, talk with moderator Matthew Cox, executive vice president and CFO of Corewell Health.

Photo: Courtesy HFMA

NASHVILLE - Four health system CFOs on Sunday kicked off the opening keynote session of the Healthcare Financial Management Association annual conference by summing up the challenges hospitals have overcome and how they're tackling the ones ahead.

Hospitals are still recovering from the pandemic, and half remain in a loss position financially, said Susan Nelson, executive vice president and CFO of MedStar Health. Revenue rate increases are not keeping up with inflation. Workforce pressures remain, including the fact that folks are tired.

"We're certainly feeling those challenges," said Elizabeth C. Foshage, executive vice president and CFO of Ascension Health. Another issue is capital, Foshage said. Projects with the largest ROI are the ones going forward. 

Innovation at Ascension has included new ways to deliver care through telehealth and hospital at home pilots, according to Foshage.

"We need to be very focused," said James G. Lee, executive vice president and CFO of Multicare Health System. "We have so much on our plates every day."

CFOs know what they have to do, but the challenge is in executing, Lee said. "We need to be creative. There's solutions we haven't tried."

Hospitals must be able to cooperate with their nursing colleagues, Lee said, to remain financially viable.

William B. Rutherford, executive vice president and CFO of HCA said health systems must be very data-driven in how they assess the environment and identify and communicate their response to challenges.

Resilience is key by looking at past pressures and using those examples to move forward, the CFOs said. They've already come through the height of the COVID-19 pandemic.

Financially and otherwise, there was no worse time than March 2020, Rutherford said. Last year, there were dire predictions of a recession and inflation worries.

HCA executives took a look at how the health system responded to past economic downturns, Rutherford said. 

"We took a look at exercises we never thought we'd have to pull off the shelf and execute," Rutherford said. "Once we knew we could make it through financially, the focus was on our mission of taking care of people." 

Ascension also looked at the hardships the founders of the Catholic health system had to overcome to move forward with their mission, Foshage said. 

"We have had pandemics before," Lee said of Multicare, which has been in the community for 140 years. "They're not new or unique." However, he said, "I don't think we should sugar-coat the challenges."

The total cost of care is being addressed at Multicare by working with payers to move towards an attribution model for value-based care, Lee said. Not all payers will entertain a conversation for this capitation model, Lee said. Multicare is working with both fee-for-service and value-based payments and is currently at a tipping point in reducing utilization, while the government as payer is not making up for the 15% cost of inflation, he said.

In Maryland, MedStar has a model through the Center for Medicare and Medicaid Innovation that is focused on total cost of care, Nelson said. Virtual care offers up opportunities, Nelson said. The challenge, she said, is how do you help people get to a better cost state and keep the costs as reasonable as possible?

Another issue for health systems is addressing the social determinants of health that aren't necessarily part of the direct provision of healthcare. Ascension can connect people to community impact officers and try to heal some of those issues, Foshage said.

Challenges ahead include friction in the revenue cycle process from a patient's point of view, integrating provider networks and aligning incentives technologically, clinically and financially, the CFOs said.

To speed up more consistent transactions in the revenue cycle, Ascension is looking at AI and ChatGPT, while also being cautious about doing so, Foshage said. Statistics show that, within two years, 80% of workers, and not just in healthcare, will have at least 10% of their jobs impacted by ChatGPT and artificial intelligence, she said.

"Buckle up and get ready," Foshage said.

Multicare has deployed an AI robot that helps nurses get linens and other supplies and makes deliveries to the lab, Lee said. The machines learn from their tasks what they need to do to perform, Lee said.

Nelson said, "It's an exciting time with healthcare and technology."

Twitter: @SusanJMorse
Email the writer: SMorse@himss.org