Health system CFOs around the country are working to expand access to care, either organically or through strategic partnerships, and grow their businesses after a financially challenging couple of years.
Yale New Haven (Conn.) Health CFO Gail Kosyla told Becker's the health system's biggest growth opportunities over the next few years include "stronger alignment with our clinical partner, Yale School of Medicine towards improved access for services and population health."
"We recently embarked on a joint strategic plan that better aligns our collective priorities and sets economic funding strategies that better support our initiatives," said Ms. Kosyla, who previously served as executive vice president of system financial operations for West Orange, N.J.-based RWJBarnabas Health. "Included in this is our Access 365 initiative, which standardizes our workflows and enables greater availability of needed care for our patients."
Access 365 aims to create a "world-class experience" for all consumers, including patients, providers, referring providers and employees, according to Yale New Haven. One area this program supports is radiology and expanding access to appointments for imaging procedures.
In October, the health system acquired PhysicianOne Urgent Care, which operates 26 urgent care facilities across Massachusetts, New York and Connecticut. Yale New Haven previously had a clinical affiliation with PhysicianOne that helped provide its patients with access to high-quality primary care providers and specialists in the area.
Fully integrating the urgent care provider into the health system's care continuum was a natural next step.
"This will allow 24/7 urgent and telehealth access for the communities we serve, and continuity into our full system of care," Ms. Kosyla said.
On the hospital front, Yale New Haven had planned to acquire three Connecticut hospitals from Los Angeles-based Prospect Medical Holdings — a for-profit hospital operator — but last month sued to get out of the deal. Yale New Haven alleges that Prospect engaged in irresponsible financial practices and breached its contract by not paying rent and taxes on time, letting the three hospitals deteriorate.
The news comes at a time when private equity firms are coming under increased scrutiny by lawmakers and other stakeholders for reduced care quality and staff conditions at hospitals and other facilities.
Hospital M&A is also rebounding after a lull in recent years, with private equity firms, payers and non-traditional owners — such as General Catalyst's Health Assurance Transformation Corp. — pursuing strategic hospital and health system transactions.
"I expect strong competition and consolidation will continue both horizontally and vertically. Additionally, more non-traditional owners will be present in the market," Ms. Kosyla said. "Developing integrated models that focus on efficiency and improving outcomes will be key to success. Through our investments in population health and Access 365, we will be able to successfully focus on these goals."
Additionally, Yale New Haven is focused on process improvements through its CORE initiative: Achieving a Bold Strategy Through Collaboration, Optimization, Resiliency and Efficiency. "This framework allows us to systematically analyze and implement process solutions to enable more efficiency and better outcomes," she said.
On average, hospital operating margins are rebounding across the U.S., but 40% of hospitals are still losing money, according to Kaufman Hall's most recent report. Ms. Kosyla offered some sound advice for hospitals still struggling to strengthen their margins.
"Organizations should focus on growth initiatives as identified by their strategic plans. Growth initiatives should have targeted ROI — whether financial or mission-based, and where possible, should align pricing strategies in payer relationships," she said.
"Consider optimizing systems of care, including partnering where it makes sense. Systems need to ensure that patients' needs are at the forefront. This may mean they need to stop doing services that are no longer aligned. Systems should also strive to reduce costs through standardization to achieve greater efficiencies and outcomes."
One pain point that continues to challenge CFOs is getting paid appropriately and on time by commercial Medicare Advantage contracts, and a growing number of hospitals and health systems are pushing back and dropping MA contracts with certain commercial payers.
"The biggest challenges we are seeing are the administrative burdens of commercial MA contracts," Ms. Kosyla said. "Additionally, we see instances of required utilization and quality metrics that do not align with our overall population health strategies. Both are burdensome and costly for our organization, and result in lower overall reimbursement than traditional Medicare. Health systems need to better partner with MA plans to ensure alignment, and potentially limit the number of plans with which they contract for better collaboration and contract performance."