UAB Health System CFO Reflects on 2020 Challenges, Silver Linings

It is the role of the CFO to make sure that amid the pandemic challenges to the healthcare industry that the provider organization can function operationally and access necessary resources.

Editor's note: This conversation is a transcript from an episode of the HealthLeaders Finance Podcast. Audio of the interview can be found here.

Coronavirus cases and deaths are surging across the country, matching or breaking records set back in the spring. Hospital leaders are faced with a harsh déjà vu as beds become scarce, PPE remains a valuable commodity, and clinical staff is pushed to the brink.

It is the role of the CFO to make sure that amid the pandemic challenges to the healthcare industry that the provider organization can function operationally and access necessary resources.

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In this month's episode of the HealthLeaders Finance Podcast, Dawn Bulgarella, CFO at UAB Health System in Birmingham, Alabama, details how the academic medical center sector has been affected by COVID-19 and what business opportunities will be available after the pandemic.

This transcript has been lightly edited for brevity and clarity.

HealthLeaders: Speaking from the perspective of an academic medical center, what have been the unique financial and operational challenges related to the pandemic?

Dawn Bulgarella: I think we'll all be glad to turn the page in 2020 at the end of this month. These have been difficult days, weeks, and months. With the resurgence of COVID patients that you referenced across the country, we’re seeing that here in Birmingham and across the state of Alabama.

We are experiencing a shortage of healthcare providers, namely nurses. We have prepared for the potential shortage of beds or equipment should the volume of our COVID-positive patients outpace our capacity.

The pandemic stress on our employees and, particularly those on the front lines, [has been felt] along with the financial pressures that began for us in earnest in mid-March with roughly a seven-week period, in which we canceled all of the nonessential surgeries and procedures at not only the university hospital but within all of the hospital facilities. We significantly reduced the ambulatory volume within our outpatient centers and in the physician's offices, and like the rest of the country, our emergency rooms were vacated.

As an academic medical center, what has made our experience unique are some of the challenges that we've faced. [UAB Hospital] is a more than 1,100-bed hospital and, pre-COVID, we maintained an occupancy rate in excess of 90% at all times. That is extremely high for a hospital, but at 90% or better seven days a week, 365 days of the year, we have to have staff organized to provide care at that level. So, you can imagine the financial challenges that we faced in trying to maintain that staffing, our facilities, and our operations in anticipation of a patient surge while experiencing the significant reductions in patient volumes and, obviously, the revenue stream that comes from those patients.

[Additionally,] as the largest employer in the state of Alabama, we've got a heightened sense of responsibility, and we chose, in the face of those financial challenges [in mid-March], not to furlough staff. We did reduce operating costs where we could but, in managing our staff, we felt it was the right thing to do and we knew that we would need all of these staff members if and when that surge hit and certainly once things return to normal, whenever that will be.

Maintaining our employee base as an academic medical center has taken on some new challenges: we've provided daycare options, childcare options for faculty and staff when schools didn't open in person, and ensured continued training of our residents, medical and nursing students, and anybody else who needed clinical experiences for their educational needs.

We've also been active in COVID-19 research. We've participated in clinical trials for the vaccine, and we are fortunate to have the experts that we have here at UAB within infectious disease, immunology, and epidemiology. Lastly, we are looking down the barrel of actively engaged in delivering the COVID-19 vaccines, and with that comes its own set of challenges and opportunities that we're gearing up for.

HL: Conversely, can you speak to some of the opportunities, both short-term and long-term, that UAB Health System has in terms of growth, innovation, and research?

Bulgarella: There have been some silver linings over the last several months. I think telemedicine nationally and, certainly here at UAB, is an obvious opportunity that we recognized during the pandemic.

Pre-COVID, we were looking at telemedicine through a lens of growth, perhaps treating some rural patients via telemedicine or even providing some specialty assistance to rural hospitals. For us, while that philosophy is still there, patients are going to continue to demand telemedicine as a means of convenience and almost immediate access. Within a matter of weeks, UAB transitioned from virtually all subspecialty care that was in-person to telemedicine platforms for a vast majority of our patients. So, that's a big win for us.

We've been actively engaged in the community via testing. We had active community involvement prior to COVID, but this has certainly given us many more opportunities, and I think we've been able to offer more enhanced community support.

Nationally, remote working has become an opportunity that has been propelled forward as a function of COVID. In many cases, I think that has led to greater employee satisfaction. We'd like to continue that if we can. It should lead to a reduced office space or reduced footprint and, theoretically, that'll allow us to recruit much more broadly. We're evaluating longer-term plans for how we can make sure that we do that [recruiting] and do that successfully.

[Also], UAB opened up one of the first post-COVID treatment clinics, recognizing that we've got some patients that the illness has hit hard and it will remain persistent. Some of the symptoms will be persistent for several weeks or even months, so we've opened up a multidisciplinary clinic where patients can [get healthcare] and get them to the right specialist at the right time. That program is not only unique to Birmingham but also one of the few programs of its kind in the country. For us, amid COVID, we entered a strategic alliance with the Ascension St. Vincent's hospitals throughout Alabama. To do something of that size during all this chaos has been a challenge but a great benefit, and we know we're going to have a long collaborative relationship with them.

HL: How have you been planning for 2021 given the unprecedented level of uncertainty facing your organization, your state, and the country as a whole? Is there any advice you'd pass along to your peers as they grapple with similar issues?

Bulgarella: Flexibility is probably the key piece of advice that I would offer looking back on 2020 and, quite frankly, headed into 2021, perhaps with a healthy dose of patience and even creativity. We have an October 1 start to our fiscal year and, so planning for us, particularly budget planning when we talk about finance, has been challenging.

Budgeting involves some level of predictability and that is absolutely a missing element over the last nine months, so we've been thankful to work with our senior leaders, our boards, and so on in modifying that planning operationally. Again, flexibility is the key to maintaining the nursing staff that you need and maintaining all your frontline care providers. Beyond just that from a nursing perspective, we've worked to align our financial planning and our strategic planning as much as we can to be sure that we can do that in as close to real time as possible.

HL: What do you view as the defining lessons of 2020 for hospital CFOs? If you could have spoken to yourself this time last year, what would you have said to prepare for the pandemic?

Bulgarella: One piece of advice I would have given myself is straightforward: I would have suggested, ‘Get some rest; you're going to need it.’ When the pandemic started back in the spring, we were anticipating that this was going to be short-lived. I think early on when we sent folks to work from home, we said, ‘Hey, this is going to be two weeks.’ And then, if you can go even further back, we thought, ‘Well, as soon as the temperature hits a certain height, then things would be over.’ I don't think any of us anticipated that we would still be where we are essentially nine months later in December of this current year. So, my advice would be, ‘Get some rest, take a break; you're going to need it.’

Working through the pandemic has challenged all our professional skill sets. Whether you work in the finance, clinical, or legal arena, whatever it might be, chances are you have gone well beyond [that skill set] in working with teams to ensure that you could get everything done that needed to be done while also maintaining a sense of composure, calm, and optimism throughout. ... I’m absolutely looking forward to 2021 and post-COVID transitions.

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.