These days one can hardly attend a financial conference, listen to a webcast, or, in my case, conduct an interview without hearing a CFO bemoan how challenging it is to meet the demands of healthcare regulations while trying to reduce organizational costs. I'm sympathetic, but if you think it's challenging to work around the government, just imagine operating within the belly of the beast, so to speak. Reducing costs and improving quality while answering to the Congress and taxpayers is what your counterparts at the VA do all the time.
To inspire frustrated CFOs dealing with so many mandates, I asked Michael Finegan, the network director for Veterans Integrated Service Network 11 (VISN 11) to share his secrets on making cost reductions and quality improvements in a bureaucracy.
Finegan, who received the John D. Chase Award for Executive Excellence at the 117th annual meeting of the Association of Military Surgeons of the United States last month, oversees eight VA medical centers and 27 outpatient clinics covering more than 90,000 square miles in Illinois, Indiana, Michigan, and Ohio. With an annual budget of exactly $1,978,893,258 to manage, he is accountable for every taxpayer penny.
He received the Chase Award, in part, for his efforts to improve the financial performance of his region—he was able to garner a 15% increase in third-party payer collections. Moreover, Finegan's region has been able to keep the cost per patient nearly flat for the last three years ($6,504 in FY09, $6,685 in FY10 and $6,939 in FY11), no small task as healthcare costs continue to increase nationwide.