Since 2008, Amy Floria has served as CFO of IU Health Goshen (Ind.) Hospital. During that time, she has learned how to run a hospital's finance team in today's healthcare climate, which she says requires being "strategic in thought and nimble in action."
During her time as CFO, Ms. Floria has faced numerous industry challenges, such as changing reimbursement levels, moving to ICD-10 and shifting to consumer-driven healthcare, Ms. Floria has met all of these challenges head on, and she has learned many valuable lessons in the process.
Becker's Hospital Review recently had the opportunity to catch up with Ms. Floria and get her insight on a number of issues, including how she's handled the myriad of challenges facing hospital CFOs today.
Question: What skills are essential for a health system CFO in today's healthcare climate beyond traditional financial and business acumen?
Amy Floria: Health system CFOs must be strategic in thought and nimble in action. We must think three and four steps ahead due to the pace of change in healthcare. The pace is exhausting but CFOs must be nimble and proactively respond to anticipated changes without deviating from the system's key strategic objectives. In addition, a CFO must be an excellent communicator and be able to explain the path the system is navigating. We need to be able to explain the "why" behind the system's strategy.
Q: What is the greatest challenge facing hospital and health system CFOs today?
AF: It is very difficult for CFOs to project and to manage the shift of reimbursement from fee-for-service payments to value-based and risk-based reimbursement. The decrease in reimbursement expands behind cuts in payments from Medicare and other third-party payers. More services are shifting to outpatient services which are often paid at lower rates. Predicting the long-term impact of non-traditional healthcare providers such as CVS, Walgreens and Walmart is problematic and adds a new set of challenges, both operational and financial.
Q: How is IU Health Goshen navigating in the shifting reimbursement climate? 
AF: Fortunately, the shift in reimbursement is slower in northern Indiana. IU Health Goshen is participating in a couple of [accountable care organizations] with Medicare and [Indianapolis-based] Anthem. We struggle with projecting the impact of risk-based contracts and entered into these contracts in a very thoughtful manner in an effort to minimize the downside impact. We were one of the first two facilities to enter into an ACO arrangement with Anthem. We are starting on a small scale to determine what we don't know before we jump in with both feet. We are also evaluating the IU Health Goshen's price strategy in anticipation of a stronger retail presence in Goshen, including the opening of an ambulatory surgery center in 2016.
Q: In the last year, what has been your greatest accomplishment as CFO?
AF: IU Health Goshen did a great job of preparing for the impact of moving to ICD-10. Early results indicate a minimal financial impact on Goshen. We [have] also implemented several process improvements in the revenue cycle. In 2015, point of service collections increased by 78 percent over 2014. We are focusing more on developing a collaborate relationship with our patients. We want to be advocates for our patients and work with them to identify resources to meet their financial obligation, including simplifying the financial assistance application process. We aim to minimize the stress the cost of care creates for our patients.
Q: What is one goal you have for the next year and how will you achieve it?
AF: We need to better understand our cost of providing care to our patients. IU Health Goshen is located in a strong manufacturing community where businesses know every cost component of their products. We need to learn from these businesses and apply these processes to our key service lines. In 2015, we implemented new cost accounting software, but we need to continue to improve the accuracy of the data inputs, including the measurement of costs at a micro level. In addition, we will analyze the price elasticity of our market, investigate price pressures and develop a pricing strategy accordingly.