The Changing CFO Role During the Great Resignation

The large number of workers leaving the healthcare industry is causing roles to be redefined to handle the loss, including that of the CFO.

Editor's note: This is part three of a three-part series about the Great Resignation from the healthcare CFO perspective. Read parts one and two.

The healthcare industry has been hard hit by the so-called Great Resignation, with the trend impacting recruiting, retention, and rewards strategies at health systems and hospitals. It is also helping to redefine several job roles, including that of the CFO.

HealthLeaders examines how the CFO role at many hospitals and healthcare systems has taken on much broader responsibilities resulting from the Great Resignation. Sharing their views on what those changes include are Terry Lutz, CFO at Scheurer Hospital, a 25-bed critical access hospital in Pigeon, Michigan; Carlos Bohorquez, CFO at El Camino Health in Mountain View, California; and Dr. Gail Gazelle, MD, assistant professor of medicine at Harvard University in Massachusetts and a master-certified coach for physicians.

How the Great Resignation affects the role of the CFO

From a strictly operational perspective, the pandemic has significantly increased the workload for most healthcare CFOs. That includes handling and accounting for rounds of stimulus money, complying with new regulations, and managing skyrocketing accounts for healthcare services.

"My role as CFO has become much more active as I try to balance the normal work of the monthly financial statement process; the annual budget process; year-end and audit preparation; and cost reports, with managing the additional funding received as a result of COVID—how to effectively and appropriately expend it; and analyzing new services along with market evaluation of pay structures," explains Lutz.

"My workload has increased significantly. It doesn't help when stimulus money is sent to the organization with strings attached that haven't been detailed," Lutz says.

But due to the Great Resignation, CFOs are also finding that their role is becoming more people-oriented than numbers-driven.

"It has forced me to think about things that are not 100% germane to finance numbers," says Carlos Bohorquez, CFO at El Camino Health. El Camino Health includes two nonprofit hospitals: Mountain View Hospital and Los Gatos Hospital, as well as urgent care, multi-specialty care, and primary care facilities.

Bohorquez says he now needs to have a strong grasp on human resources issues. Topping the list are practices around recruiting and retention. But he says the CFO must also have empathy to what staff have been experiencing during the pandemic.

"Leaders—whether they're financial, operational, or medical leaders—need to support their frontline workers. They need to show up on the frontlines and express their appreciation," Gazelle says.

"What is interesting is how many leaders in healthcare will send out a weekly email to their people saying, 'Thank you so much. We see how hard you're working. We wouldn't be able to do this without you.' But, sadly, many of the recipients of those emails—the clinicians on the frontlines—have become a little bitter. Their thinking is, 'If you really cared about us, you'd come down and see what we're doing.' There's a sense that they're not being seen, that their efforts aren't being appreciated."

"The number one advice that I have for anybody in leadership in healthcare, is to get out there and see what your workers are doing," Gazelle says. "That personal touch can make a large difference in the sense of morale and the commitment of your frontline workforce."

Long-term impacts

Hospitals and health systems are so busy dealing with the staffing shortage that it is difficult to look far ahead. Nevertheless, the healthcare industry could be on the verge of significant change in how care is delivered. At least, that is how some see it if things don't change soon.

"The impact on the healthcare system is almost unimaginable," Gazelle says. "For example, say you have an ICU with incredibly ill and vulnerable patients who need constant nursing attention and monitoring. And perhaps the normal nursing ratio would be one nurse to one patient, or at most, two patients. What we're seeing now is not just one nurse to three patients, but sometimes even one nurse to four patients."

The effect is that nurses—no matter how good or how committed and devoted they are—can't keep up with the needs of the sickest patients, Gazelle says.

"There is a lot of rightful concern about what this is going to mean for all of us and for our loved ones. It's a concerning situation," Gazelle says.

While Gazelle acknowledges that she always tries to be an optimist, the impact of the Great Resignation has her worried about its long-term implications.

"We're in a difficult situation as a nation. We really are," Gazelle says. "I don't know what the future holds. Many of us in positions of leadership don't know how this is going to play out. But we can imagine that healthcare is going to look different in the foreseeable future."

For one thing, "staffing changes will mean differences in quality of care," Gazelle says. "That will mean that perhaps family members will have to be at a sick person's bedside, doing some of the duties that we may not have staff to do."

Steps for CFOs to combat this trend

So, what should CFOs be doing in response?

• Increase salaries when possible, but carefully

"My best advice is to make every effort to limit the amounts of increases requested for perceived market changes, since other positions will end up being increased as well," Lutz says. "Be prepared to recommend changes to operations to decrease costs, without impacting care provided. Know which services either have to be discontinued or revamped to make up for the additional costs being added in other areas."

• Focus on worker needs, both operationally and emotionally

"It's a lot cheaper to retain employees than to recruit and train new employees to the organization," Bohorquez says.

Employees want to be heard, Bohorquez says. They want acknowledgement by leadership of the work that they're doing. CFOs can help open channels of communication and find ways to reward workers beyond the normal paycheck.

"We all come to work each day because we love what we do. Employees want to feel like they're recognized for their commitment and dedication to the organization. We need to say 'Thank you' to everybody for all the work they do. If we don't, we can't function," Bohorquez says.

• Strive to be an employer of choice

No one knows when the Great Resignation may end, or even slow. The expectation is that the staffing shortage in healthcare will only grow worse over the next few years. That will place even greater pressure on the battle for key talent.

"It will create an even greater competition for qualified staff," Gazelle says. Those hospitals and healthcare systems that win in this battle will be the ones that are seen as top employers—that pay top dollar, that provide training and career development opportunities, that listen to and engage with the workforce, and help them feel that their efforts always matter and improve the quality of care that patients receive.

Leading CFOs will step up to this challenge by advocating and supporting job benefits and opportunities that differentiate a great place to work versus a good place to work, Gazelle says.