At this week's Healthleaders CFO Exchange, CFOs are bracing for financial turbulence under the new administration, with a renewed focus on cost containment, advocacy, and operational efficiency.
As the healthcare industry grapples with the uncertainty brought on by the new administration's policy agenda, CFOs from across the country convened this week at the HealthLeaders CFO Exchange to discuss how to navigate Medicaid reductions, labor challenges, site neutrality threats, and the evolving role of technology in financial strategy.
OBBBA, Site Neutrality and the Cost of Uncertainty
The One Big Beautiful Bill (OBBBA) and looming policy changes, particularly around site neutrality and 340B drug pricing, dominated much of the conversation Wednesday.
Emory Healthcare CFO Lisa Urbistondo framed OBBBA as one of the most pressing threats to financial stability, citing the challenge of building operational infrastructure while keeping the board informed and engaged.
Brad Hipp, CFO of Tucson Medical Center, who recently led the acquisition of an oncology business, expressed concern over investing in growth while reimbursement structures remain unsettled.
And Allison Viramontes, VP and CFO at Jupiter Medical Center in Florida, which is a non-Medicaid expansion state, projected a $40 million to $60 million revenue loss from proposed site neutrality policies and questioned the real ROI of AI investments amid widespread budget pressure.
Strategizing for Medicaid Coverage Reductions
Medicaid disenrollments and tightening state budgets are forcing CFOs to reassess their approach to uncompensated care and state-level advocacy. Timothy Ajayi, VP and CFO of Bristol Health, raised concern over the importance of improved documentation to protect reimbursements.
Meanwhile, others lamented the fragmented voice of healthcare providers in state legislatures, calling for a coordinated push to communicate healthcare's economic importance to state representatives.
Viramontes noted that more states are restricting hospitals from pursuing payment from certain patients, further tightening revenue streams. Sometimes, patient settlements can bankrupt hospitals, she warned, stressing that policymakers and the public often misunderstand healthcare's complex cost structure.
Cost Containment and Strategic Service Consolidation
CFOs shared a variety of tactics to withstand reimbursement pressure:
Some are focusing on cardiovascular service line growth and evaluating whether duplicative service providers across close geographic sites are truly needed. Others are consolidating community-based programs for efficiency.
One CFO highlighted revenue cycle optimization, asset redeployment, and partnerships with third parties as key cost-saving levers.
Labor costs were another dominant theme. Most CFOs acknowledged ongoing efforts to rationalize labor. One noted 150 layoffs at their organization tied to a rev cycle overhaul, emphasizing this was due to overstaffing, not AI replacement.
Mike Marquardt, CFO of UVA Health, stressed the importance of upskilling existing staff, while others mentioned using third-party benchmarking tools, such as Vizient, to align workforce productivity.
Hospital-at-Home (HaH) and Payer Friction
Three years into its rollout, the Hospital-at-Home (HaH) model is still struggling to break even, said Jim Wilson, CFO of the Mayo Clinic Health System, citing the regulatory burden and limitations in patient enrollment. As with Medicaid, variation in state regulations adds complexity and unpredictability for CFOs.
When it comes to payer strategy, several CFOs described it as a "fight." One shared that even piloting a value-based care (VBC) model with a commercial payer took immense effort; that led CFOs in the room to ponder how health systems can manage these intense relationships without draining their internal resources.
Optimism Amid Adversity
Despite the headwinds, the group expressed cautious optimism. Some remain bullish on AI and technology, while others see opportunity in forced transformation:
"It's not a dead end," one CFO said. "It's a hard road, but it continues."
Marie DeFreitas is the CFO editor for HealthLeaders.
KEY TAKEAWAYS
CFOs are preparing for tens of millions of dollars in potential losses due to proposed reimbursement changes, with a strong focus on consolidating services and engaging state legislators to protect funding streams.
From revenue cycle overhauls and layoffs to asset optimization and benchmarking tools, CFOs are aggressively targeting inefficiencies without overcommitting to what they say are unproven AI solutions.
With increasing regulatory variation and strained payer negotiations, CFOs emphasized the need for stronger industry advocacy and better communication of healthcare economics to policymakers.