Faced with regulatory uncertainties, growing demand, fluctuating costs, and fierce competition, those who run a hospital or healthcare system face a job that is as demanding as managing even the most complex corporate business. That’s why more and more healthcare CFOs rely on cloud-based financial software to increase access to timely and accurate financial information.
Count Brent Copen among them. The CFO for Tiburcio Vasquez Health Center (TVHC) recently shared his insights into how nonprofit health centers can improve financial performance.
“When I arrived at TVHC, one of the challenges we faced was that timely financial information was difficult to access quickly,” said Copen. “This feels particularly important right now given the uncertainties we’re facing. Right now we have a budget to deliver, so we’re doing multi-case scenario planning to really think through the uncertainties, such as the possibility that Medicaid moves to block grants.”
Watch the webcast, “Nonprofit Healthcare Industry Spotlight: Learn How Health Centers are Improving Finance Performance”
The frustration healthcare CFOs most often talk about is their inability to easily manage, distribute, and communicate financial information. Copen is a great example. When he was just using Excel, he experienced the struggle of working with spreadsheets containing 40 or 50 different tabs. People would place assumptions in certain tabs and then forget where, requiring the team to dig through to find them again. Without a centralized place to hold assumptions, there was more room for error.
In addition, slight variances in how information was reported month to month made it difficult for his team to compare apples to apples between budgets and actuals. Finally, a specific report request from a chief medical officer or chief dental officer would often take two to three days to prepare, requiring his controller to be pulled away from her day-to-day work to create a report that would only get used once.
For Copen, the Adaptive Suite has been useful for providing predictability and improving communication. “I want my CEO, executive team, and department heads to really understand their budgets. The first step in doing that is to make sure the information is readily available while maintaining an active dialogue.”
How can you make your healthcare financial budgeting and reporting process less chaotic? Here are five ways healthcare CFOs can improve their organization’s financial performance:
Streamlined budget process: “All the budget assumptions we have, from our staffing and personnel allocations to our indirect costs we use across business lines, are now centralized in one place,” said Copen. Since all his data is based in the cloud, he’s able to work directly with department heads to build preliminary budgets, have a conversation, and make adjustments quickly.
Robust reports: Copen is responsible for creating monthly reports for the finance committee, the executive team, each of their departments, and each of their grant-drive programs. Without cloud-based financial software, creating reports was a major time suck. “Now the whole thing is 30 seconds, just push a button and update the report,” said Copen.
Slice-and-dice data: Often healthcare CFOs get requests for specific reports, like the productivity of staff in one department. By using cloud-based financial reporting tools, Copen can create a new report in just a few minutes to give department heads the data they need to make decisions around staffing and hiring.
Integrated data: Financial data is only one part of running a hospital. Equally important is the electronic medical record data that reflects the care being provided each day. Copen integrates the two into his corporate performance management system so he can easily combine both financial and productivity data in one report.
Better understanding: Because financial information is readily available to the executive team and department heads, there’s been an increase in financial understanding across the system. “They get this data and start asking questions, which allows for the program and finance folks to work together, engage in dialogue, and start to solve problems,” Copen said. The ability to see both the high level and also drill down to the transaction level lets everyone understand not only the larger trends, but exactly where the money was spent.