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Here's How CFOs Are Tackling Cost Containment

Analysis  |  By Marie DeFreitas  
   April 02, 2025

"Proactive not reactive" cost containment strategies are vital for finance executives.

Healthcare costs are rising. From labor costs, to technology investments, to shifting reimbursements models, many components are fueling heightened costs. It's enough to give CFOs whiplash.

In this week's episode of The Winning Edge, sponsored by HealthTrust, finance executives dove into the nuances of cost containment for 2025. Lynn Ansley, Vice President of Revenue Cycle Management at Moffitt Cancer Center, James Dregney, Chief Financial Officer and Vice President of Finance and Operations at Sauk Prairie Healthcare, and Rich Philbrick, SVP, Strategic Accounts and Performance Solutions at HealthTrust, discussed what cost containment means for health systems and how they are strategizing in 2025.

Shifting Into Value Based Care

Reimbursement timelines and collaborating with payers are key challenges, according to the panelists. 

Payer-provider disputes have risen 70% in just the last two years, and collectively providers now spend nearly $20 billion annually on claims denials, with half of that wasted on disputes that should have never happened.

One opportunity that comes into play here is value-based care, which is designed to shift the focus from volume to value. But a large component of value-based care is a strategic focus on preventative and primary care.

While shifting the focus toward preventative care is certainly crucial for success in VBC models, it can't all be done at once. Data sharing is a large factor, panelists said, and providers and payers will need to examine more effective ways to transparently share data.

For health systems looking to utilize VBC models for effective cost management, panelists had some advice:

  • Create a balance in shifting services. Ensure there is continuous balance between inpatient and outpatient settings as more focus is placed on preventive care services and programs.
  • Ensure thorough data sharing with payers. Hold payers accountable to transparent, accessible data for all services.
  • Be creative with the available options. Stay curious and vigilant about what resources and opportunities are available when shifting services.

Considering AI Investments

New technologies like AI are also prime candidates for cost containment opportunities. While initial AI investments can be expensive, the long-term pay off is usually worth it for a health system. Not only can AI help with streamlining and automating certain processes, it can identify areas of inefficiency and waste.

Dregney, whose organization consists of a 36-bed acute care hospital, pointed out that not every health system is going to have the resources to carry out its own AI operations.

This is where partnerships come into the picture. For finance executives looking to implement AI but unable to tackle the large costs or technological nuances of implementation, third-party partnerships can be a great resource for creating advanced technology opportunities, especially for smaller organizations.

Tariffs and Supply Chain Woes

Tariffs pose yet another big challenge for providers, and budgeting for these changes may certainly play into cost containment efforts for 2025. Panelists spoke about supply chain disruptions during the COVID-19 pandemic, and said today's fast-paced policy changes are leaving many health executives with a blurry idea of how healthcare costs will be impacted over the next few years.

Having an effective supply chain strategy is critical, said Dregney. Partnering with outside organizations is also a good option for smaller health systems and hospitals. He said it's crucial to do the homework to select the right GPO and ensure the organization is purchasing items on contract .

Ansley discussed how her organization prioritizes the cross-examination of data for its pricey oncology drugs. This is a collaboration between the pharmacy side and the revenue cycle side, she said. It's important to have a strategy that is "proactive not reactive," to price increases, she added.

For providers looking to mitigate these extra costs as much as they can, diversifying supply chains and utilizing domestic suppliers may be helpful. Panelists suggested having an efficient inventory process and utilizing innovative technology for data analytics within the supply chain.

This episode of our Winning Edge series is sponsored by HealthTrust.

Marie DeFreitas is the CFO editor for HealthLeaders.


KEY TAKEAWAYS

The Winning Edge for Cost Containment webinar broke down some of finance executives' top strategies for curbing high healthcare costs.

Value-based care models and preventive care are key components of a large-scale strategy for recognizing and containing costs.

Tariffs will have a big impact on healthcare supply chain costs, and there are a few options for providers to consider.


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