University of Iowa Health Care CFO Mark Henrichs is focused on sustainable growth and efficiency benchmarking.
Iowa City-based University of Iowa Health Care, the state's only academic medical center, comprises University of Iowa Hospitals and Clinics, University of Iowa Physicians and the Carver College of Medicine.
University of Iowa Healthcare recently acquired Mercy Iowa City for $28 million. The system also named Bradley Haws, former CFO of Atlanta-based Emory Healthcare, as its next CEO.
Mr. Henrichs has been the CFO for University of Iowa Health Care since December 2021 and has held finance leadership roles within the system for two decades. He shared his top priorities and future outlook for the system with Becker's:
Question: What are the top three strategic financial priorities for your health system in the next fiscal year? How do these align with the organization's overall mission and goals?
Mark Henrichs: UI Health Care's top three financial priorities are:
- To invest in people, processes, and facilities with the goal to meet healthcare needs within Iowa and beyond. Our team's focus is ensuring access to the complex and tertiary needs of patients in a state where the population is more widely disperse than much of the country. Economic disruptions in recent years have created new healthcare challenges in communities outside of large urban areas, and we are focused on sustainable ways to expand access to care.
- Strong focus on capital allocation and planning models that address patient needs, sustainable growth, and creative new solutions to balance inflationary impacts seen in both capital and operating expenditures. Related to this, we will continue to explore new revenue streams to support our missions.
- Advancement in defined efficiency benchmarking and cost analysis that fully engages leaders and staff throughout the organization in driving clinical, operational, and financial success. Benchmarking factors will better inform service line initiatives, day-to-day operations, population health impacts, and leadership on opportunities for efficiency or needs for investment.
Q: What are the biggest financial challenges facing your health system today? On the other hand, what are the most promising financial opportunities?
MH: The biggest financial challenges for UI Health Care are inflation and workforce challenges. We have made significant investments in workforce and, as a result, are seeing some improvements in permanent staffing. However, physician and hospital workforce challenges will likely be long-lasting and will be a leading issue in any healthcare management discussion over the next five to 10 years.
Our most promising financial opportunities relate to the ability of UI Health Care to expand coordinated care and access to our patient population. By investing in new ideas and technology, we can increase access to specialty care to impact health outcomes in the state. One factor directly impacting the opportunity to expand access is addressed through our 10-year master plan that includes targeted investment in expansion of facilities. These investments from our master plan link to our clinical, research and education missions.
Q: How is your system leveraging technology and digital health platforms to enhance patient care, improve operational efficiency and generate revenue?
MH: Digital platforms are a key piece of healthcare's future. Thoughtful implementation of digital tools and artificial intelligence will broadly impact the clinical, teaching and research missions of our institution.
In the clinical realm, telemedicine expansion has completely changed access to care of patients in many areas, including psychological care. Over the last five years, telemedicine visits have increased by 1,400%, providing expanded access to populations throughout the state.
In population health, new tools and datasets provide expanded demographic data, better informing providers on paths to successful assessment of patient situations and establishing coordinated treatment plans to assure the best outcomes. The medical record tools that are available to patients give them more data and information on health trends to help them manage successful outcomes for themselves. Increased patient engagement and education expands the provider/patient relationship to focus on prevention, treatment, and the most successful outcomes.
Q: What partnerships, joint ventures, mergers or acquisitions is your system exploring to strengthen its financial position or expand service offerings?
MH: Working with partners is definitely the wave of the future in healthcare. An example of the type of partnerships the UIHC is doing include opening the University of Iowa Health Network Rehabilitation Hospital with Encompass Health in June 2020. The combined effort met a need for these services for the University's patient population, and brought together the expertise of the two entities to improve the care continuum and outcomes for patients needing these services. This has resulted in great outcomes that are above national averages for mobility, functional efficiency and success in returning to home quicker than care protocols prior to the joint venture.
Another example of an arrangement bringing innovation and financial benefit to UI Health Care is our 10-year value partnership between UI Health Care and Siemens Healthineers. The partnership links the entities in expanding access to cutting-edge imaging technology and continual operational improvement. Project initiatives through the partnership utilize artificial intelligence and data analytics to improve performance and efficiency, expand research opportunities, and invest in workforce training and development for staff and students. One project underway involves UI Health Care utilizing technology to recognize efficiency opportunities in appointment duration within MRI and CT templates, allowing for expanded growth without investment in additional equipment and staffing. Similarly, technologies are being implemented to optimize surgical scheduling and templates across clinical departments and teams to ensure timely scheduling of cases when opportunities are identified. We continue to work with possible partners on ways to bring together expertise and investment in a way that truly changes healthcare outcomes for our patients.
Q: Given the unpredictability of events like global pandemics, what are you doing to ensure financial resilience and sustainability in the face of unforeseen challenges?
MH: We have refined our 10-year financial planning process over the last two years. In the past we would do an annual update of this plan, incorporating market outlook, shifts in the economic environment, growth estimates, etc. Given the quickly changing healthcare landscape, we now complete updates to the long-range financial plan twice a year and have expanded the factors that are part of the analysis, including increased economic and inflationary analysis and scenario modeling.
We are also expanding the frequency of reporting outcomes of investments compared to approved plans. The discipline around more frequent feedback loops of success or opportunities for improvement help ensure timely reaction if shifts in plans are needed.
Engagement of providers, leaders and staff in our investment outcomes through clear and concise communication of progress will support the excitement of being part of a dynamic healthcare enterprise.