Hospitals face challenges from all sides: razor-thin margins, high fixed costs and unpredictable revenue streams.
Healthcare leaders navigate maze-like regulatory and insurance complexities externally, while grappling with high labor costs and reputation management internally. For many hospitals, expense growth now outpaces revenue growth and CFOs must lead the charge to course correct.
CFOs have become strategic navigators of the organization
At the center of a hospital’s economic vitality is the CFO — a role that has become more multifaceted with remits spanning short-term strategic leadership, digital transformation and organizational alignment, while also safeguarding the long-term financial sustainability of the entire system.
For CFOs, there’s been a recent shift from budgeting, financial reporting and cost control to more comprehensive management of the hospital-wide financial strategy, risk management, payer relations and mergers and acquisitions, all balanced with maintaining community reputation and sustaining philanthropic engagements. Today’s CFO no longer operates siloed with the finance team but is the ‘spoke of the wheel’ with many internal departments.
As their influence expands, so does accountability.
The revenue cycle must be used as a strategic asset
Why is the revenue cycle such a prime opportunity for CFOs? Today, 40% of hospitals are operating with a negative margin. Without advanced revenue cycle management (RCM) strategies and technology, hospitals are at an immediate disadvantage to maintain financial stability.
1. Denials have become a margin threat
Claim denials have evolved from a routine challenge into a serious margin risk, as expenses outpace revenue and margins tighten. With increasingly complex payer requirements and regulatory shifts, denials are harder to resolve and can significantly impact financial stability.
2. RCM as a risk management tool
A strong RCM strategy helps hospitals reduce exposure to audit penalties, payer disputes and cash flow disruptions — vital amid unpredictable revenue streams and mounting external pressures. CFOs must protect their organizations from financial shocks and build a more resilient foundation for long-term sustainability.
3. Implementing AI can increase operational efficiency
Today’s AI-powered RCM can automate routine tasks, predict denial risks and optimize workflows across the entire revenue cycle, streamlining operations and freeing internal teams to focus on patient care and strategic priorities. AI-driven solutions combined with an end-to-end approach like Ensemble’s deliver continuous innovation, deeper insights and stronger accountability, making operational excellence achievable even in resource-constrained environments.
4. Data can be leveraged to better understand cash flow pressures
Data analytics are central to modern RCM, offering hospitals real-time visibility into financial performance. By leveraging comprehensive data across the revenue cycle, CFOs can identify bottlenecks, manage AR proactively and respond quickly to payer or regulatory changes. This data-driven approach stabilizes cash flow and uncovers opportunities for growth and margin improvement, making advanced RCM analytics a strategic asset.
The future of RCM is streamlined
Historicially, hospitals tried to manage RCM internally or through fragmented vendor relationships, but results have been inconsistent, with misaligned systems, differing standard operating procedures and varied KPIs to measure against.
Instead, more hospitals are realizing the benefit of leveraging a single strategic partner to manage its end-to-end revenue cycle operations. From patient registration to final payment collection, every stage of the financial process is handled by one partner to optimize revenue, reduce administrative burden and improve patient experience. The value driven by an end-to-end model goes beyond operational efficiency, bringing deeper insights, stronger performance accountability and continuous innovation.
“There are only so many levers of opportunity for margin improvement that you can pull,” said Marty Bonick, president and CEO of Ardent Health. “If you’re not focusing on your revenue cycle, you’re missing one of the biggest opportunities available to make an impact on your system.”
In a market under pressure from regulation, payers and technology, a single, integrated end-to-end RCM partner who can offer solution improvements, help drive adoption and take on the risks of innovation to free up time and money for patient care is vital.
The right partner significantly improves downstream impact
Ensemble is the nation’s leading end-to-end revenue cycle partner. Leveraging its AI-driven, scalable RCM model to deliver measurable impact, it helps health systems focus on clinical excellence while strengthening financial performance.
Ensemble works directly with hospital CFOs and their teams to identify and resolve tension points across the financial stream. By managing 600+ steps of the revenue cycle and overseeing $45 billion in net patient revenue, Ensemble delivers a holistic, innovation-driven approach that transforms financial performance.
Clients see positive, tangible impact for desired goals, supporting the communities they serve and creating new opportunities for patient care. Ensemble maintains one of the highest client retention rates in the industry and consistently helps clients achieve 4%–6% net revenue improvement. In partnership with Ensemble:
- Valley Health saw a $20M net revenue increase in year one, exceeding cash goals and improving operations, enabling new investments like a Rehabilitation Tower and expanded primary care.
- Tower Health reported its first positive operating margin in seven years, after one year of partnership. “We are never going to be the best in class at doing [revenue cycle] because we want to invest in our clinical infrastructure,” said Sue Perrotty, immediate past CEO of Tower Health, of her time at the organization. “For revenue cycle, we wanted to partner with an organization where that’s all they do, and Ensemble is the best in class at that.”
- Carilion Clinic has seen transformative results, using revenue gains to expand emergency care and launch Virginia’s first Level 1 Pediatric Trauma Bay.
CFOs can redefine financial leadership by optimizing the revenue cycle
CFOs need to approach the revenue cycle not as an operational function, but as a strategic and imperative lever. Orchestrating the right end-to-end RCM partnership simplifies complexity, delivers measurable value and empowers health systems to strengthen performance and invest confidently in the future. CFOs who lead this shift move beyond mere oversight to drive transformation, positioning their organizations for long-term resilience and growth.