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CFO Reality Check

Practical insights, analysis and perspectives for chief financial officers and finance leaders that impact the bottom line

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Navigating Forward

The COVID-19 pandemic stressed health care in our country, but also created opportunities to accelerate change. The CFO Navigating Forward series provides insights to assess and prepare organizations for rapid transformation.

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CFOs need strategies that help them anticipate ongoing shifts and help them respond was swift well-guided action.

The disruption that we've seen with COVID-19 is actually helping us focus on the things that I think in healthcare we've always done. But I think this brings a lot of this much more to the forefront. One of it is really focused on customer demand. How do we change our delivery models to be able to adapt to what the customers are demanding at this point? Tele-health is definitely here to stay. I think we've got to really embrace that and figure out are there ways that we can expand that? And then just organizational agility. We've got to look at shortening kind of our planning cycles. We've got to really focus much more on shorter strategic timelines, actually even down to looking potentially at quarterly strategic plans rather than more long-term.

We're going to see, I think, radical changes within our healthcare value chain. Part of that is going to come from the disruption that we see with making sure we have enough PPE equipment shortages. And all of that is really kind of forcing us to rethink about how we acquire those products, how we manage those products and really how we build those relationships within our supply chain partners. The drop in consumer engagement, we're talking about economic hardships that our community and our patients are facing. They're going to have less discretionary spending, which is going to put pressure I think on our facilities to really know what our consumers are really going to want. Going forward we're going to have to spend more time really kind of understanding what shifts are happening in our market.

We've got to understand what the consumers want, what their expectations are, what they're willing to pay for and balance that with our quality and our outcomes. One of the things that we need to be looking at is ease of access. Do we make it easy for our patients to have services within our organization? There are going to be a lot of competitors in the market. Are they really competitors or are they people we need to be spending more time in collaboration with? Consumers are concerned about coming into our facilities at times and we've got to be able to take a step back and figure out where we're able to provide that service, where consumers feel safe, and that they're getting the services that they need. And sometimes it may not necessarily be with our facility, but it may be us collaborating with other organizations to be able to provide that care within our market. Every facility can't be everything to everybody, but we still have a community that we have to take care of.

If we end up in a market that people do not have insurance or they're not insured anymore, we all know that their primary care will be delivered in our emergency rooms or in urgent care. I think we've got to work closer with our departments of health, looking at those social determinants of health and finding out how we can actually work better in the market to help our consumers be more proactive about their health care, rather than it becoming reactive. We've got to do a better job on predictive modeling or predictive methodologies if you will. I think this is the first time in my career that I am not able to really depend on history to determine kind of what the future looks like.

All of us through the summer of 2020 have been very appreciative of the stimulus money and the CARES money that was afforded to individuals and actually given to us as healthcare providers. We all pray that there won't be a second wave of COVID, but if it is there's going to be pressure, I think, on the government on how they're going to be able to help us as providers going forward. I don't think any of us have a crystal ball to be able to determine what that is going to look like. I think the one thing that we do know is that we are going to see more patients on Medicaid and that is going to put a tremendous amount of pressure on the states. And are we going to be providing services to more patients on Medicaid for less dollars than we are being paid today?

The challenges that we have today are still going to continue to put significant pressure on the healthcare industry. As a result, it is incumbent upon us as CFOs to remain agile and nimble, to use new sources of data, to connect with our customers and our consumers, and to create value for our healthcare purchasers. We have an opportunity now more than ever to truly transform our industry, to help people live healthier lives and to make the health system work better for everyone.

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Navigating Forward: Regulation

Facing economic pressure and ongoing health concerns, government leaders are making decisions crucial to health care leaders. Explore what to watch for, actions to take and how we can come together to address the complex challenges of public health.

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