"One of the biggest challenges we're having is that our supply costs are growing faster than our revenues," says CFO Niyum Gandhi.
Hospitals and health systems are under mounting pressure to reduce costs, enhance the labor force, and improve the quality of healthcare services for patients. But rising inflation and worker shortages are making these tasks more challenging.
Labor costs account for around 50% of a hospital's costs and supply chain expenditures make up 20% of hospital costs, according to the American Hospital Association. Mass General Brigham—a Boston-based health system with 13 hospitals and $14 billion in total patient revenue—has been dealing with these financial challenges since the start of the pandemic. CFO Niyum Gandhi recently connected with HealthLeaders to discuss the solutions the organization has put in place to overcome inflation and support its workforce.
HealthLeaders: How has inflation affected Mass General Brigham?
Niyum Gandhi: It's been very challenging. Inflation is at the highest level it's been in 41 years. It's important to note that the last time inflation was this high, hospitals were still paying the cost-plus. The DRG hadn't been invented. We submitted our cost report to Medicare and had our reimbursement adjusted based on it. That's why hospitals are now no longer paid cost-plus, because of the persistent inflation in the late 70s and early 80s. And of course, by the time the new payment model was released, inflation was back down to 3.2%. It's not exceeded six-and-change until recently.
Hospitals, post-acute facilities, and physician practices were not built for inflation. We don't increase our prices relative to inflation—we have a commitment to affordability— but even if we didn't [have that commitment], we couldn't increase our prices in a manner that counteracts inflation.
One of the biggest challenges we're having is that our supply costs are growing faster than our revenues. We do our best to make sure we're managing non-labor costs effectively through the way that we contract. But at a certain point, there is nothing we can do when individual supply costs go up faster than our revenue per unit of service. It's compounded by the fact that now in a post-peak pandemic world, we have a greater emphasis on supply chain resiliency.
The bigger impact has been on labor. About 60% to 65% of our cost structure is labor. We're the largest employer in Massachusetts. It's important to us to make sure that our wages keep pace with what our employees need. When employees are seeing percent increases in the costs in their personal lives, we need to try to get at least as close to that as possible on the wage side. And employees are making decisions to leave healthcare because of the challenges of the pandemic as well. And so our wage costs have increased significantly.
HL: What has Mass General Brigham's financial well-being been like over the course of the pandemic?
Gandhi: Our financial performance is significantly worse than it has been in recent years. We're not alone in that. But we're also taking a sharper look at areas where we can be more efficient. We are on a journey to integrate our system and create efficiencies by combining clinical services across the organization. Adhering to common protocols across the system and moving sites of service to lower-cost settings are all things that some others in the industry were doing maybe five to 10 years ago, and we've just been a little bit later to do because we weren't really set up to be an integrated system until relatively recently. And so, we're trying to realize those efficiencies as quickly as possible, while also investing in the future and dealing with the significant growth in both labor and non-labor expenses.
HL: As CFO, what creative solutions to the organization's financial challenges are you needing to explore?
Gandhi: One of the things that I think as an industry we've fallen behind on is focusing on places where we can make investments that improve the productivity of our employees. We have a big focus on intelligent automation right now to take the rote and lower-value work off our employees' plates, so they can focus on the things where they add value. Many other industries had been earlier to adopt automation and intelligent automation than healthcare has. We're emphasizing that significantly, especially in the back-office areas. This reduces cost trends as well, by allowing our employees to be more efficient and focus on the places where they can have the greatest value. It also shifts some of our cost structure long term more towards non-labor, scalable costs, rather than labor costs where for every additional transaction process we need "X" percent more employees. We can absorb the growth with the same number of employees without making them work harder. Giving them the tools so that they can work more easily and more effectively across a broader range makes us a little bit more inflation resilient for the future as well.
HL: Looking back at everything that has happened over the last few years, what do you predict 2023 will have in store for the financial well-being of hospitals and health systems?
Gandhi: For most health systems, 2022 is going to be the worst financial year in their history. In 2023, we'll see some improvement as organizations implement the types of strategies I was talking about, as well as others that make sense for their environment. What inflation is highlighting in the macroeconomic environment is that it's exacerbating the structural gap between revenue growth and expense growth. We've had this for over a decade, where revenue per unit of service has grown slower than cost per unit of service. We've just found a way to become 1% more efficient every year. And so, if revenue per unit of service is growing at 2%, and the cost is growing at 3%, we can close that 1% gap every year by becoming a little bit more efficient. So, what's happening right now is an acceleration of a secular trend, which means we can't stop investing in structural solutions for the future.
What I mean by that is that historically for health systems there has been a lot of cross-subsidization going on. You make money in one area so that you can fulfill your missions in other areas. And I think, because of the commitment to affordability, the structural gap between clinical revenue growth and clinical expense growth will continue. So, we need new ways to fund the mission and we're focused on that in terms of finding other opportunities for revenue generation, whether they be outside of direct patient care, whether they be growing the commercialization of our research, intellectual property, getting into new services, etc. The systems that are long-term focused will probably have slightly worse 2023 financials because they won't have let up on the gas on the investments that they need to make for 2024 through 2028.
Conway Regional Health System—an Arkansas-based healthcare provider with over $950 million in total patient revenue and 150 total staffed beds—has appointed 30-year industry veteran Bill Pack as its new chief financial officer.
Pack is responsible for the financial operations of the health system which includes Conway Regional Medical Center, Conway Regional Rehabilitation Hospital, Dardanelle Regional Medical Center, Conway Regional Surgery Center, and several outpatient centers and clinics throughout North Central Arkansas. He will also lead Conway Regional Health System’s accounting, business office, admissions, and medical information teams.
Before joining Conway Regional, Pack served as a system vice president with Centura Health in Denver. Prior to Centura, he was vice president of finance and chief financial officer with organizations including CHI St. Luke’s in Houston, CHRISTUS in San Antonio, and SCL Health in Denver.
"We have gained a great teammate as well as a talented leader who truly seeks to make a difference in his community," Matt Troup, president, and CEO of Conway Regional Health System said in a release announcing Pack’s appointment. "We are extremely blessed to have someone of his background and talent join our team. To have 'fit and talent' is a rare combination."
The health system has been hammered by rising costs and declining reimbursements.
CommonSpirit Health—a Chicago-based non-profit Catholic health system—recently released its full-year 2022 financial results, reporting an operating loss of $1.04 billion when compared to the $1 billion operating income from the 2021 full-year.
CommonSpirit also reported a 10% rise in expenses, a slight increase in revenue by 3.5%, and a 2.6% margin. The decline in government and payer reimbursements didn’t keep up with the rising cost of providing care.
"This continues to be a very challenging time for health systems, especially nonprofit health systems like CommonSpirit where a majority of patients are Medicare and Medicaid beneficiaries," CommonSpirit Chief Financial Officer Dan Morissette, said in a release announcing the results. "As an integrated organization with a broad footprint, we’ve been able to take many steps to reduce costs and grow revenue."
Hospitals are struggling to retain talent as healthcare workers—particularly nurses—exit the field. CommonSpirit says it has implemented different strategies to help grow and support its workforce including established internal programs focused on staff retraining, wellness, and resilience, and developing new graduate medical education relationships.
"It’s clear we need to do more to improve performance," Morissette continued. "We will remain focused on growth in the new healthcare landscape, finding additional cost savings, and lowering contract labor costs while reducing turnover and improving retention by doing even more to support our teams."
Healthcare leaders are implementing creative solutions to some of the sector’s most pressing challenges.
CFOs are facing challenge after challenge resulting from the pandemic, inflation, labor shortages, and growing expenses. These problems call for creative solutions to improve the financial well-being of hospitals and health systems. CFOs are uniquely positioned to find resolutions that will strengthen their bottom line while prioritizing patient care and employee satisfaction.
HealthLeaders recently connected with healthcare industry leaders to discuss some of the difficulties CFOs are facing, where they need to focus going forward, and what solutions they’ve utilized within their organizations.
HealthLeaders: What are some of the biggest challenges impacting rural healthcare providers?
Douglas Arvin, CFO for Altru Health System: The ability to recruit and retain clinicians, physicians, and medical staff members is probably more challenging because we don't live on a beach or coast here. And so, there are challenges associated with that. Geography is a challenge, especially when facilities can be miles and miles apart. But people in rural communities have the same healthcare needs. So, improving their lives or, even saving their lives, is just as critical here. It's important to be able to invest in that and make sure that access to healthcare is available for people in this region and throughout the country.
HL: What financial challenges is your organization facing and what solutions do you plan to utilize?
Sherron Rogers, CFO for Johns Hopkins All Children’s Hospital: Healthcare is changing rapidly, and we are challenged to keep up with the pace of change. It's important to continue to provide the most meaningful services to our patients, and the community, and to expand the services that we provide. Like everyone else, we're facing challenges in continuing to recruit and retain the workforce. We have a wonderful organization that is mission-driven and is a place where people want to work. But that's not the end of the story. People need to feel their work is valued and they can do that in our organization. And we need to continue to make sure we're providing those meaningful experiences for our members because they are the ones giving to our patients. We are hiring in all areas of the health system, but like others, we're trying to make sure we're recruiting, in nursing, and respiratory therapy, specifically.
We've asked a lot of our people throughout the course of the pandemic. You don't go into healthcare expecting an easy career. Most of us in healthcare are the ones running toward a challenge, not away from one. We have that in our spirit. However, nobody expected the pandemic or the effects of the pandemic to last as long as it has, so that provides somewhat of a weariness, and that's part of the challenge to attracting and retaining talent.
HL: What do you think CFOs will be focusing on over the next six to 12 months?
Tina Wheeler, U.S. healthcare leader for Deloitte: Margin pressures, how to enhance revenue, how to control costs, and how to deal with the workforce. They'll also want to focus on evolving their digital tools, and digital capabilities, and enhancing the patient experience while improving efficiency and driving down costs. Watching the journey that healthcare organizations have gone on related to health equity, sustainability, or ESG will be top of mind.
Hospitals and health systems are making key investments in technology to advance their healthcare capabilities, enhance the patient experience, and improve the organizations' overall financial well-being. Greater technological investments can also incentivize employees to remain with the organization, another positive jolt for the bottom line.
"Every industry is moving toward technology, it doesn't matter if it is retail, travel, or going to a ball game, everything is [accessed] through technology," says Jennifer Williams, CFO and VP of finance for Wayne HealthCare. "It is an expense, but our mission is to provide quality care. To us, technology on the patient finance side and the patient access side is more important. It is more important that the patient has good quality access on the front end. It is a cost, but we look at it from the perspective of our patients and how it will help our patients."
Greater funding toward technological advancements within hospitals and health systems—whether it is for the admin and workforce side of things or the patient side of things—can only make an organization better. When clinical outcomes improve, more patients will walk through your doors, making the organization the best place for care. When technology helps improve the workflow and back-end tasks it can act as a tool for recruiting and retaining the best workers. Technological investments are not to be taken lightly, but with the right combination of funding, cooperation, and collaboration, CFOs can establish a technological investment strategy that boosts their financial wellness.
Wayne HealthCare—a Greenville, Ohio–based hospital, and healthcare provider with around $75 million in net patient revenue—has been making investments in technology that will not only improve the patient experience but also make administering to patients easier for the organization as well.
In 2021 leaders at Wayne HealthCare decided to look for a new EHR and ERP—their electronic health record and enterprise resource planning tools. Improving the ERP allowed Wayne HealthCare to get a better, more comprehensive view of the organization's overall financial health.
"This technology helped our patients on the front end during the pandemic," Williams says. "A lot of hospitals were doing curbside waiting rooms or in the parking lots. This technology gave us the help we needed during the pandemic."
Research from Deloitte found that by the end of 2021 almost $23 billion had been invested in the healthcare technology landscape through 556 completed transactions, which surpassed the record growth of the previous two years.
When it comes to investments in technology there are many areas within the hospital and health system to consider. On the patient side of things, Wayne HealthCare invested in better quality assurance and registration tools through a tech vendor that now helps the hospital identify payment estimates and gets patients registered for services and treatments faster.
"We do a three-year capital budget, and we don't have a dollar amount set aside just for technology," Williams says. "We have a dollar amount set aside for the whole hospital. Every year when we're looking at the capital budget, we ask our directors to tell us what items they believe they'll need, be it fixed assets or technology. We ask the directors to rate them from the highest need to the lowest need, so we know what to make a priority. As a team, we then look together to determine which [assets] we're going to select, so we stay in line with our costs and our budget."
Managing patient expectations
One of the most significant barriers to care is a patient's ability to pay, which can keep someone from seeking treatment when they need it most. Williams says Wayne HealthCare understands this and that is another reason why the organization made technological investments on the administration side.
"We're looking to collect and cover the cost of the services that we provide," she says. "Having tools that provide estimates does allow the patient to know that they do have a copay or deductible costs. Patients knowing this when they come in helps you understand your cash flow, your accounts receivable, and your days with cash on hand. Some patients are fearful to come because they don't know what it's going to cost them and by having that technology in place, it helps them understand how to prepare for that."
Spending the big bucks
When Dr. Laura Crocitto, the chief medical officer and director of the Helen Diller Family Comprehensive Cancer Center for the University of California San Francisco Health, came to work at the hospital she wanted to bring in a robotic focal high-intensity focused ultrasound machine (HIFU) to help treat prostate cancer patients. It was an investment that would cost approximately $750,000 but has positive implications for the financial health of the hospital in the long run, as well as for patients.
Crocitto expected it would take over two years to break even in terms of the ROI on the HIFU. That was a conservative estimate of approximately one patient per month using a combination of Medicare and private insurance. The investment ended up paying off faster than expected.
"We met our ROI in the first year even though we projected an ROI in two or more years," she said. "Instead of one patient per month, we saw, on average, five patients per month in the first year of using the HIFU machine."
HIFU is an outpatient procedure and therefore less costly than admitting patients for an overnight stay, says Brandon Blonquist, the business line finance director for cancer services at UCSF.
"HIFU also provides a less invasive treatment option for patients on active surveillance who might otherwise have delayed treatment or sought alternatives elsewhere," he says. "Offering HIFU treatment is expected to help improve market share and better meet the demand and needs of our patients."
Working closely with the CFO played a huge role in getting the HIFU machine into the hospital, Dr. Crocitto says.
"Our CFO had to be involved with ensuring all of the costs, that we didn't miss anything if anything else needs to be included, and also working with doctors to understand our volumes," she says. "They work with our strategy and marketing teams to know our current market share and the likelihood of increasing that market share."
Using technology to make a difference
At Rady Children's Hospital in San Diego, the organization invests in technology in two main areas—clinical and external affairs, says Steve Jennings, senior vice president and chief external affairs officer and executive director for Rady Children's Hospital Foundation. The hospital recently made a major investment in 3D imaging, which gives doctors the chance to better individualize their treatments to a specific patient's needs.
"We have a 3D imaging lab on our San Diego campus, which gives physicians the ability to hold a model of the heart they're about to operate on in their hands," Jennings says. "The hospital has also focused heavily on genomic technology, allowing us to sequence our patients' entire genome in a matter of hours."
In 2018, the hospital set the Guinness World Record for the fastest genetic diagnosis. Rady Children's Hospital is also working to finance improvements in its cybersecurity efforts, something many healthcare organizations are doing.
"Better technology means better outcomes for the kids, which is the top priority for us," Jennings says. "When kids are doing better, it is good for the organization. On the other hand, donors love to invest in technology because they get excited about it. When doctors have cool ideas that require a significant technological investment, donors are open to that and want to learn how the technology works. Rady Children's Hospital received a $120 million donation for our genomics institute and the advanced technology that accompanies it, which just goes to show the popularity of technological investments. These investments make a big impact in a myriad of ways, and the generation of more philanthropic dollars is going to make the hospital healthy financially."
When deciding to move forward on technological investments CFOs and other healthcare leaders need to work together to build a review process to examine how the proposed technology will benefit patients and the organization's financial health.
"When it comes to deciding what type of technology to invest in, there is a thorough review process with committees that oversee all capital investments," Jennings said. "We look closely at whether the technology supports the hospital's philosophy to be consistently excellent and selectively distinctive. We also look at the long-term costs, initial costs, potential grants, benefits to revenue, and the hospital's existing resources when considering an investment."
We also have priority service lines that are the main focus of our investments—including cardiology, neurology, orthopedics, and a few other specialties. Each program is led by a physician with a vision for their specialty, so we generally listen to their ideas and work from there. As an organization, we carefully consider how we invest in technology because we never close our doors."
King is a healthcare executive with almost a decade of experience in the industry.
A new chief financial officer has taken over at HCA Florida Fort Walton-Destin Hospital—a Wright, Florida-based medical center with over $3 billion in total patient revenue and 267 total staffed beds.
Matt King, a healthcare executive with almost a decade of experience in the industry, assumed the role on August 22, 2022. He joins HCA Florida Fort Walton-Destin Hospital from Northern Virginia, where he has served as CFO of HCA’s StoneSprings and Dominion Hospitals since 2020. Prior to that, King held the role of ACFO at StoneSprings Hospital for nearly two years.
"Matt brings with him extensive experience and an impressive financial background," Zach McCluskey, CEO of HCA Florida Fort Walton-Destin Hospital, said in a release announcing King’s appointment. “We’re thrilled to welcome him to our team as we continue to grow and expand the services we offer in the Tri-County area.
King joined HCA Healthcare in 2016 serving as an audit manager for internal audit before being promoted to senior audit manager a year later. Previously, he worked as a senior financial analyst with Baxalta Incorporated.
"I’m extremely excited to join the team and get involved in all HCA Florida Healthcare is doing in Okaloosa and the surrounding counties," King said in the release.
Separately, in early September, HCA Florida Fort Walton-Destin Hospital announced the completion of the first phase of a $100 million expansion, which includes a new four-story, 95,000-square-foot patient tower and 10,000-square-foot renovated dietary space. The expansion adds 10 ICU beds, eight cardiovascular ICU beds, and 24 surgical care beds. This expansion will increase the hospital’s capacity from 267 to 309 beds.
"HCA Florida Fort Walton-Destin Hospital is committed to continuing our work to meet the needs of this growing community," McCluskey, said in a release. "We wanted our facility to reflect the enormous talents of our colleagues. By equipping our team with the latest technologies in an updated, modern space, we hope to provide a more healing environment for them and the people we serve."
If approved, Atrium Health expects the satellite hospital to open on January 1, 2026.
Atrium Health—a Charlotte, North Carolina-based healthcare network with over 40 hospitals and $2 billion in net operating revenue—wants to turn its Harrisburg, North Carolina-based emergency room into a satellite hospital.
The health system submitted a "certificate of need" proposal to the Cabarrus County authorities for the $85.5 million expansion and is waiting on the state to approve the project.
"In an effort to bring high quality, convenient access to care to the residents of southern Cabarrus County that are already choosing AH Harrisburg for their health care needs, AH Cabarrus proposes to relocate 24 acute care beds and one operating room from its main campus to its existing Harrisburg hospital campus," Atrium said in a press release shared with HealthLeaders. "The proposed project also involves the replacement and relocation of an existing fixed MRI scanner to Atrium Health Harrisburg from Atrium Health MRI at its Concord Mills/Speedway location."
Additional inpatient, imaging, and surgical services will include 20 medical and surgical acute care beds, four ICU beds, a replacement CT scanner, a relocated and repaired MRI machine, fluoroscopy services, and the addition of a C-arm (a large, mobile imaging device) in the operating room.
The decision date for this project is set for the end of January. If approved, Atrium Health expects the satellite hospital to open on January 1, 2026.
Chris Wilde currently serves as executive vice president and enterprise chief financial officer for Atrium Navicent Health.
Vanderbilt University Hospital—a Nashville-based medical provider with over $4 billion in total revenue—has appointed Chris Wilde, executive vice president, and enterprise chief financial officer for Atrium Navicent Health, as its new Divisional CFO. Wilde will step into the role on October 31, 2022.
Wilde will be responsible for the overall financial performance and all aspects of daily fiscal management of VUH and Adult Ambulatory Operations to enable VUMC’s flagship hospital and adult clinics to achieve operational, financial, and strategic goals.
"The aggressive growth of our health system has created the need for a high level of financial leadership and expertise for VUH and the adult clinics," Cecelia Moore, VUMC’s Chief Financial Officer, and Treasurer said in a press release announcing Wilde’s appointment. "Chris was chosen for this important expanded role based on his experience and background in a variety of leadership roles in previous organizations."
Wilde’s responsibilities will include serving as an adviser to other members of VUH’s leadership team regarding the organization’s operational financial management and strategic financial development. Wilde will oversee and support the Adult Ambulatory Finance staff and provide coordination between VUH and ambulatory operations. VUH includes a Level 1 trauma center, regional burn center, and Tennessee’s only transplant center. VUH is VUMC’s quaternary adult teaching hospital that is licensed for 726 acute care and specialty beds and 79 observation and extended recovery beds.
"It is a blessing to have the opportunity to work with such a prestigious organization," Wilde said in the release. "I am looking so forward to working with Cecelia, the leaders at VUH and adult clinics, and the financial team as we grow to meet the healthcare needs in Tennessee. It is a very exciting time to be in Nashville."
Kurtz says inflation has been 'devastating, to say the least,' for the hospital.
On August 1, CMS announced the inpatient prospective payment system (IPPS) rule for 2023, which increased the hospital reimbursement rate by 4.3%, for a total of $2.6 billion for the next fiscal year.
To get a better understanding of what this final rule means, HealthLeaders connected with Chris Kurtz, CFO of the University of Michigan Health-West. Kurtz shared his thoughts on the IPPS final rule and its 4.3% reimbursement rate in an upcoming episode of the HealthLeaders podcast.
HealthLeaders: What is the IPPS final rule?
Chris Kurtz: It's the method of determining both payment rates for Medicare and Medicaid, as well as the payment policy of CMS. It includes not only payment rates to the acute care hospitals, but also to long-term acute care hospitals. It includes quality programs, value-based programs, and even a little bit on the medical education funding side of things.
HL: CMS had originally proposed a 3.2% reimbursement rate, which is now 4.3%. Why the change?
Kurtz: Each spring CMS posts its proposed rates and policy changes for public comment. That initial proposal last spring was, I believe, a 3.2% of an increase in what CMS refers to as its market basket rate. Others might consider this the core rate increase, [since it] does not include things like medical education, capital, and other policy changes. But CMS received overwhelming public comment from many in the hospital industry that 3.2% was just not nearly enough to offset all the inflation that we're experiencing, certainly the highest in the last 40 years. And so, CMS went back and did take some of that feedback into their final policy.
HL: What are your feelings on the new rate?
Kurtz: Like most hospital CFOs, I appreciate the fact that CMS has recognized that inflation is a significant issue, and they actually went back and adjusted their rates for that. However, I don't think I'm alone in [believing it] doesn't keep up with the inflation we've actually been experiencing. So, while it's nice to have, it's probably not likely to fix a lot of the problems that we've got going on.
CMS notes that this is the largest increase they've had in the last 30 years. However, as everybody is all too aware right now, current inflation is the highest it's been in 40 years. So, there's already a gap there. The other thing for the audience to remember is that the 4% increase in rates doesn't account for every policy change that's in that IPPS rule. So, capital spending, for instance, is only 2.3%.
At our hospital, construction costs have nearly doubled in the last two years. Uncompensated care is being reduced in the policy to the tune of I think over $300,000,000 just in the state of Michigan alone. We've done our own analysis of what we believe this policy change will do to our own hospital and we estimate that the 4.3% is actually more like a 3.4% increase once you net everything down and you look at all the different parts of the policy.
HL: How is inflation affecting your hospital?
Kurtz: Devastating, to say the least. Our hospital runs on a fiscal year, not a calendar year. So, we run from July to June each year. In the first six months of our 2022, which just wrapped up, we had a pretty healthy, pretty typical 3% operating margin that allows us to reinvest in the buildings and the organization and our people. All the stuff that CFOs are always talking about. But the second six months from January to June of our 2022 year have completely wiped out any margin we had. I think we are not alone like most hospitals in the country, we actually flipped to an operating loss come January through June of 2022, primarily related to inflation.
HL: What does the new IPPS rate mean for the financial well-being of hospitals, health systems, and their patients?
Kurtz: I think it is unsustainable. The last six months have been completely devastating and I think you’re going to see more reductions in staff and services coming in the next few months. I know in our own community here there's been some [staffing, closure, and regulatory] announcements already. There are more and more announcements being made nationally each and every day. I expect that to continue for a little while before it gets any better.
HL: Speaking of regulatory announcements, what are your thoughts regarding the recent surprise billing regulations?
Kurtz: The concept is a long time coming and I'll say shame on our industry for not addressing it sooner and having somebody tell us how to fix the problem, rather than us as an industry trying to fix it ourselves. And so, because others have fixed it on our behalf, I do have some concerns about whether it can be operationalized or not.
I worry about our ability to provide accurate estimates in an industry like ours. We can give estimates up front, but very often things change once a procedure is started or once somebody's under anesthesia. And can we continue to give those estimates under certain circumstances like that? So, I think there's still more to come. We're working through it, and I think we're doing OK. But I do worry about the operational side of whether we can do what's being asked of us.
HL: Do you think the surprise billing regulations will impact care in any way?
Kurtz: It may slow it down a little bit. We're a hospital with an open medical staff, which means we have a lot of surgeons and others in the hospital who are not employed by our hospital. So, getting that coordination of the physician claim, and the hospital claim, and trying to do all of that within three days or so could be challenging. So, I do wonder if this is going to delay certain services perhaps as we try and figure all of this out.
HL: And finally, speaking more generally, when looking ahead, what do you think are some of the biggest challenges facing hospital and health system CFOs?
Kurtz: I think labor and inflation are by far the largest challenges. It's certainly what keeps me up at night and I don't really see an end at the moment to it. I'm sure it will, but at the moment I don't see it changing a whole lot in the short term. We're not just competing for staff anymore against other hospitals. We're competing for staff against other industries as nurses are leaving healthcare altogether. And so, we've got our hands full on labor and inflation and wondering if we can even staff all the beds we have. There's an issue right now in our community with a lot of hospitals not being able to staff all the beds they have. So, I do worry about that a lot.
The money will be used to make improvements to hospitals and clinical programs, make advances in research, and fund endowments.
Northwell Health—the largest non-profit healthcare provider and private employer in New York State—previously set a goal of $1 billion in fundraising, which it has surpassed thanks to contributions of over $1.02 billion from 170,000 donors including individuals, corporations, and foundations.
Outpacing the Impossible: The Northwell Campaign was launched in 2018 with the goal of raising funds to support capital projects, improvements to hospitals and clinical programs, make advances in research, and fund endowments.
"We don’t believe in limits. We set a goal to raise $1 billion and we’ve done that," Northwell Health President and CEO Michael Dowling said in a release announcing the funding. "The extraordinary generosity from our donors has significantly boosted advancements in research, education, prevention, and treatment. Philanthropy is an investment in one another, in our community and in the future, and it saves and improves people’s lives."
The funds raised have been used to create several healthcare organizations including the Sandra Atlas Bass Heart Hospital, the Clifford and Randi Lane Neurosurgical Intensive Care Unit, the Beverly and Attilio Petrocelli Advanced Surgical Pavilion, the Rahat & S. Zaki Hossain Cardiothoracic Intensive Care Unit, the Sandra Atlas Bass Center for Liver Diseases and the Helen & Alan Greene Lobby at North Shore University Hospital and the Katz Women’s Surgical Center at Glen Cove Hospital.
Donors also include 11,600 of Northwell Health’s employees—including 100% of its leadership team—who contributed over $15 million to the campaign.
"When donors support us, they are affirming their belief in Northwell and their commitment to raising health in our communities," Brian Lally, Northwell’s senior vice president and chief development officer, said in the release. "Our communities and employees have come together to support the philanthropic needs of our organization. In order to Outpace the Impossible, our work is never done. We’re using this momentum to extend our campaign and provide additional support in critical areas where the need is great."
