CFOs in the healthcare industry are facing the challenges of rising costs and the potential impact of artificial intelligence (AI) on their operations.
John Beaman, CFO of Adventist Health, and Robert Broermann, CFO of Sentara, are leading the way in exploring how AI can be integrated into their financial strategies while also dealing with the ongoing effects of the COVID-19 pandemic.
Both CFOs are aware of the financial strains caused by inflation and increased staffing costs. They recognize that labor and supply inflation are outpacing payment rates, making it difficult for hospitals to manage their finances.
Long-term contracts further complicate the situation by preventing hospitals from adjusting prices to reflect their increased expenses. Broermann reveals that approximately 40% of hospitals nationwide are either losing money or barely breaking even, highlighting the financial fragility of the healthcare system.
To address these challenges, both Adventist Health and Sentara are considering automation and AI as potential solutions for cost savings.
Sentara is exploring AI applications in medical coding and ambient listening technology for clinical note-taking, which could improve efficiency.
Adventist Health, on the other hand, is in the process of transitioning to the Epic platform, which is expected to enhance automation capabilities and integrate revenue cycle processes.
Both CFOs are also mindful of the broader implications of their financial strategies, particularly in relation to community health needs. They aim to balance outpatient and inpatient care and pursue value-based care arrangements that align with their mission to support patients throughout their healthcare journeys.
Sentara has had to make difficult decisions regarding service offerings, particularly in rural areas. Due to insufficient patient volume, they will discontinue obstetrics services at one of their rural hospitals.
This decision reflects the challenges of healthcare revenue, where varying payer mixes can significantly impact financial viability.
Both Adventist Health and Sentara are beginning to see signs of recovery from the COVID-19 pandemic, with patient volumes returning to pre-pandemic levels.
However, their ultimate goal is to achieve financial stability and profitability, which requires innovative solutions and strategic investments in technology and care delivery models.
In this evolving landscape, AI holds promise for transforming healthcare finance.
As both CFOs continue to explore its applications, integrating AI into their operations could enhance efficiency and improve patient care outcomes.
The journey towards a more automated and financially sustainable healthcare system is just beginning, and the insights from these CFOs will be crucial in shaping its future.