Keck CFO on New Care Strategies: 'We're Going to Have to Break Those Chains'

James Uli, chief financial officer of Keck Medicine of USC, talks about healthcare growth opportunities and monitoring industry trends.

The University of Southern California (USC) has hired the person who will head the financial operations of its clinical medical enterprise as it seeks to expand services in the competitive Los Angeles healthcare market.

Last month, James Uli, MHA, was introduced as chief financial officer of Keck Medicine of USC. Uli previously served as CFO of Providence Saint John's Health Center and the John Wayne Cancer Institute in Santa Monica, and held leadership positions at Loma Linda (CA) University Medical Center.

HealthLeaders Media spoke to Uli about his first month on the job at his alma mater, the initiatives he is pursuing at Keck, and what industry trends he is following.

The transcript below has been lightly edited.

HealthLeaders Media: Outside of growth and expansion initiatives, what are some insights regarding Keck's cost containment strategy?

Uli: Cost management, cost containment, and ensuring value-based care from the health system are some things we have to look at and continually reevaluate ourselves on what we're doing and if we can do it better. We know payers are going to continue to ratchet down how much they pay, and while we're primarily a tertiary, quaternary center, that doesn't mean we shouldn't focus on the cost of care we provide.

That includes ensuring that the different types of care we are providing to our patients are done in the right location at the right time. We have the new outpatient building and center. If you're providing outpatient surgeries in your primarily inpatient operating rooms, and negatively impacting the throughput of the inpatient operating rooms, then you're adding cost. Doing an outpatient surgery in the appropriate outpatient surgery setting is really important to make sure we're getting those cost savings.

HLM: What kinds of industry trends are you paying attention to?

Uli: We're following the normal trends like everyone else, such as paying attention to managing our internal cost structure to make sure we're providing as much value in the care we provide. Los Angeles is an interesting and fragmented market. Obviously, there's been a lot of consolidations and partnerships over the last few years, and we expect those to continue.

We're monitoring those local markets and beyond to see how they could have an impact on our particular service area. As the demographics of the country continues to change, whether it's the aging baby boomers or the growth of millennials in terms of their position in different markets and how they make healthcare decisions, we're evaluating strategies to see how we can best serve those populations unique to their desires and attributes.

We're cognizant of that and it's going to be an important part of healthcare growth in the future. This includes making sure we have the ability to serve different demographics in the ways they need rather than the traditional way of: 'This is the care we provide; come get it.' On healthcare, we're going to have to break those chains and find new strategies to provide care. We're not only watching it but looking for ways to improve our delivery of care.

HLM: Los Angeles is a competitive healthcare market, with several health systems vying for patient volume. What are the primary elements of Keck's financial strategy to maintain marketplace viability?

Uli: I think Keck is in a really unique position compared to other healthcare organizations in Los Angeles. We're one of two academic medical centers [in Los Angeles], along with [Ronald Reagan UCLA Medical Center]. That certainly is a competitive advantage from a certain perspective. Going beyond that, it's clear that Keck is in the earlier phases of its life compared to other academic health systems in Los Angeles.

Our hospitals are younger—Keck only assumed ownership within the last 15 years—and that positions USC differently than other academic medical centers. I think strategically, we're in a growth and expansion phase. We're taking advantage of the fact that we're a somewhat newer academic health system and trying to put together pieces to help us grow and better serve our community.  

HLM: Does a frenzied consolidation market put any additional pressure on Keck, or is M&A just an expectation for health systems in 2018?

Uli: I don't think it puts any additional pressure [on Keck]. This [consolidation market] has been going on for the last few years and we expect it to go on. I think the types of partnerships, like Optum's partnerships with physician groups, make it very interesting. We have to watch and see how those partnerships would have an impact on us here. Again, I don't think it's anything new; I don't think strategically that Keck is scrambling to find a response to those things—that's not the approach.

It's more about whether we can monitor what's going on in the industry, make a determination as to whether those consolidations or partnerships would have an impact or, for that matter, whether there are partnerships out there that we should consider being a part of. There's nothing new or concerning but in the healthcare industry there's so much consolidation going on, you have to keep your finger on the pulse; you can't let go of it.