As health systems begin the road to financial recovery from the pandemic, one characteristic of executives has emerged: they agree they are capable of quick changes.
Several hospital executives spoke Wednesday about how their organizations are navigating through the pandemic, during the Healthcare Financial Management Association Digital Annual Conference.
“That has really set the stage for us going into the future – knowing that we can do it. Knowing that we just need to find a way to implement new ideas and new activities more quickly,” said Ann Paul, chief strategy officer at St. John Health System in Oklahoma.
One of the key steps in recovery for these organizations was the implementation of telehealth.
“We were able to stay connected in the communities through telemedicine and virtual health, which we already had in place in our ministry market, but it hadn’t really taken off yet,” Paul said. “It allowed us to stay connected with our population even when we weren’t able to see them within our physician offices.”
Others said they were surprised at how well their organizations rebounded.
Bellin Health’s operating margin went from a positive to negative 20% following the halt of all elective procedures in March. However, the revenue for June was actually higher than projected prior to the pandemic, according to Jim Dietsche, the COO and CFO at Bellin Health in Wisconsin.
It came down to the culture within the organization that helped turn around Bellin’s finances.
“It wasn’t anything individually specific, it was just the team really bonding together in ways that were always there, but knowing that in a time of need that they could really band together and be very successful,” Dietsche said.
Dietsche emphasized the importance of communication from senior leadership about prioritizing cash flow during those difficult months.
“In our market, there are a few independent health systems that are much smaller. They’re definitely under stress and probably don’t have all the resources that they need to manage through this,” Dietsche said.
Northwell Health reorganized its operations during the pandemic to be more nimble, according to Michele Cusack, CFO and senior vice president.
“While we were still going through the crisis and we were still unable to do elective surgeries, we started putting a plan forward, so, once we were given the green light to be able to resume normal activity, we had almost a playbook fully in hand,” she said.
The biggest focus of the plan, Cusack said, was on the surgical side. Once elective surgeries resumed, they began scheduling them based on the risk posed to the patient.
Another consideration for organizations is the future of mergers and acquisitions, as systems that aren’t able to recover financially look for partners.
Members of Virtua Health in New Jersey described how they maneuvered the acquisition of Lourdes Health System from Trinity Health during the pandemic.
One of the first things the leadership teams did was to define their goals and decide how they would come together.
“One of my favorite sayings is, ‘If you don’t know where you’re going, any road will get you there,'” said Tim Shoger, the SVP at Kaufman Hall and Associates. “The Virtua leadership did not want to follow that path. So they were very clear about defining the parameters for this transaction.”
Once the two organizations had laid out the goals of the partnership, the integration phase began. To do so, they again set a specific plan to make integration happen smoothly and quickly.
“We had to do three main things,” said Michael Capriotti, the VP of Integration at Virtua Health. “One was to set clear goals and objectives. The second was to create a definitive process for which our operational leaders could understand how they’re walking through this integration. And thirdly, we wanted to establish a baseline financial target so we could all be starting from the same place.”
Virtua Health created a team tracker to see how well teams were moving through integration. Prior to the pandemic, all the teams were in the process of fully integrating.
“As we presented to our executive team in June of 2020, we really saw a screeching halt in some of our teams,” Capriotti said.
Despite the slowdown caused by COVID-19, Virtua Health still anticipates that it will meet its budget goal because it was able to get ahead in the integration process.
“All of that financial recovery was really made possible by establishing clear goals, establishing defined processes, establishing a baseline and a tracking mechanism, establishing the right infrastructure and really working in conjunction with our operational leaders,” Capriotti said. “Having all these things in place really became a natural place to turn to as we started thinking about our recovery.”
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