5 Hospital Finance Questions to Ask Right Now
3. How should CFOs try to offset negative influences from the issues you mention?
Lean and Six Sigma: "Healthcare, despite all the industry resources, is still behind on the deployment of process excellence and using Six Sigma and Lean initiatives to ratchet down costs. Administrators will say they've done a lot to control costs, but I'd say, 'I don't think we've done enough.' Regardless of what's been done, there's not going to be much margin to split in the coming years…we need to be very focused on costs for the next few years as we've been for the last four years."–Rooney
Cutting Costs: "They're going to have to better manage their operations; many feel they have done as much as they can but in my experience many in healthcare haven't done enough to lower their costs. Hospital executives are going to have to leave their comfort zones–it's really going to be a challenge."–Ortiz
4. What are the greatest financial challenges hospitals will face in 2011 and going forward the next 5 years?
Revenue Cycle and Collections: "Not much different than what's been their challenge all along: collection and revenue cycle [management]. Now if you have real efficiency in one area then you don't have to focus on that. But it's a never-ending series of improvements."–Rooney
Reimbursements and EHR Implementation: "Though I know I said it before, the pressure on reimbursement is going to be big challenge–they are not going to go up for hospitals or physicians." – Ortiz
5. Do you anticipate a double-dip recession for 2011 or do you feel the economy is rebounding, and why?
Slow improvement: "My feeling is that unemployment rates are still high … and healthcare is not immune. A lot of CFOs will tell you that bad debt and charity care have been skyrocketing and insured people can't afford their care. I don't see it getting better soon… it's not a pretty picture at least for a couple more years."–Rooney
Stabilizing: "I don't sense we'll experience a double-dip. The healthcare industry has experienced a lot of negative impact from the recession with more and more self-pay [patients], … but it's stable at this point and in some cases numbers are going down in terms of patients without insurance. Still I don't sense a momentum that would lead to a quick reversal; I think it's going to be slow and steady improvement."–Ortiz
While Rooney and Ortiz offer a quick glimpse of what some healthcare CFOs are anticipating for 2011, if you'd like to read more thoughts on what your peers anticipate for 2011, check out this recent article in HealthLeaders Magazine. Although there are many challenges ahead for healthcare leaders, here's wishing all hospitals and health systems a very prosperous new year.
Karen Minich-Pourshadi is a Senior Editor with HealthLeaders Media.
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