Todd Suntrapak, president and CEO of Valley Children's Healthcare in Madera, Calif., knows the importance of developing new and reliable funding sources to achieve financial stability in the long term. That's why he is passionate about "outside-the-healthcare-financial-box thinking," he told Becker's.
As part of this mindset, Mr. Suntrapak's organization is moving forward with plans for a 443-acre community development project featuring retail, housing, and recreational amenities, dubbed "The Hill." Cost estimates and an exact timeline for construction and completion have yet to be determined, as the project is in its early stages. However, Mr. Suntrapak anticipates that the project will ultimately provide independent and diversified revenue outside of patient income, establishing solid financial footing for the nonprofit system.
He discussed his financial thought process, healthcare's generational challenge, and more.
Editor's note: This is a regular series of conversations with CEOs of the nation's health systems. Responses were lightly edited for length and clarity.
Question: What's something the healthcare industry isn't talking about enough?
Todd Suntrapak: Generational demographics. There are about 76 million baby boomers of all backgrounds aged 59 to 77 in the United States. They are living healthier and longer lives, which pressures healthcare providers to provide services that match this generation's approach to aging. At the same time, U.S. birth rates are at historical lows, roughly 12 births per 1,000 people now, which is approximately half the number it was when baby boomers were born.
The difficulty for healthcare systems is managing the current generational spike and the anticipated drop-off of the next generation. Equipment, facilities, type-of-care and, importantly, staffing have different calculuses for the two generations. The need for trained and experienced care providers already is challenging. Aligning the next generation of doctors and nurses with the needs of the next generation of patients also poses unique needs.
Managing our healthcare providers and our facilities to meet current patients' care clearly is our priority. We, however, have to manage now and for what the data is telling us about what's approaching on the horizon. Although it's normal that healthcare needs shift between generations, the anticipated severe population drop-off and anticipated longer lifespans of the next 20 years presents the challenge for great healthcare minds to solve.
Q: What's an industry or business outside of healthcare that you think we could take notes from?
TS: Healthcare is the most complicated business in the world. I ascribe to the Peter Drucker view of continuous improvement. A modified-to-healthcare version of the Six Sigma methodology can position U.S. health for the future. The critical key element will be having and aligning skill sets that match patient needs and the generational evolution that healthcare must address.
Q: If you could go back in time 10 years, what would you tell yourself to start doing, or start learning about? What ended up being a bigger deal than it might have seemed at one point?
TS: Learning to be open to outside-the-healthcare-financial-box thinking is paramount for me. I've tried to manage Valley Children's Healthcare for long-term financial stability. It's challenging, as the here-and-now can distract from the what-we-need-later.
Predicting what patient needs may be in 10 years also is risky. For example, who envisioned the global pandemic occurring? Nonetheless, however healthcare needs evolve, it's clear that generating new and reliable funding sources to achieve financial stability is critical for U.S. hospitals. We're moving forward on an expansive housing, retail and entertainment development that, when completed, will provide Valley Children's Hospital with the independent and diversified revenue we can rely on beyond patient income.
Embracing a passion for what 10-years-out looks like is fundamental to what we need to do and no longer an outsourced nice to have.
Q: If you could give one message to other health system CEOs, what would it be?
TS: We're blessed to serve.