Baton Rouge, La.-based Franciscan Missionaries of Our Lady Health System is focusing on organic growth, strategic investments and strong academic partnerships to achieve market "essentiality" — a position so integral that no payer or employer can afford to exclude it from their networks.
Mike Gleason, CFO of the 10-hospital system, joined the Becker's Healthcare podcast to discuss key growth opportunities and investments projected to drive double-digit revenue and volume growth over the next three years.
Editor's note: This is an excerpt from the Becker's Healthcare podcast. Responses were lightly edited for clarity and length.
Question: How are you thinking about growth over the next 12 to 24 months? What are the key areas you're looking to invest in?
Mike Gleason: We are really focused on organic growth. Of course, you never say never — there might be an acquisition opportunity or a chance to bring another health system into ours that’s too good to pass up. But right now, we’re concentrating on our existing footprint. We believe there’s potential to grow market share across nearly all our markets to a relatively material degree. While we already have strong market share numbers, we’re working toward what we call “essentiality” —a position where no payer or business would want a health plan that doesn’t include Franciscan Missionaries of Our Lady Health System hospitals and physician networks.
By reinvesting in our organization, we aim to achieve that goal. Like many health systems, we fell behind on some basic capital investments during the recent financial challenges while protecting our balance sheet. Now, with our return to strong operating margins, we can not only catch up on some of that basic infrastructure but also make strategic investments in key service lines differentiated by some of our markets. For example, there might be opportunities in orthopedics in one market, cardiology in another, and oncology in yet another. These investments are expected to drive double-digit revenue and volume growth over the next two to three years.
Additionally, we’re expanding our strong academic partnership with LSU, which we believe will fuel further growth on that front. So while we remain open to inorganic growth opportunities, our primary focus is on organic growth — strengthening and expanding what we already have.