Top 5 Areas of Extreme Interest to Healthcare Executives

What issues are currently of greatest strategic importance to hospital and health system executives? The Health Care Advisory Board research team conducted the “Advisory Board Research Annual Health Care CEO Survey” to find out.

“While the survey tests interest in a wide range of topics, issues related to margin management—whether through revenue growth or cost control—rose to the top for 2018. In a particularly notable contrast to years’ past, cost control eclipsed revenue growth as executives’ most urgent strategic priority for the year,” says Yulan Egan, practice manager, Advisory Board Research.

The nationwide survey of 146 C-suite executives was conducted between December 2017 and March 2018. This year, the researchers asked respondents to rate 33 issues on a scale of “A” to “F,” with “A” indicating the greatest interest in learning more from Advisory Board researchers about the topic.

Here are the top five areas of interest to hospital and health system executives, based on the survey.

  1. Preparing the enterprise for sustainable cost control

This is the No. 1 concern for hospital executives (62% said they were extremely interested). That’s a higher percentage than any other topic received in the last four years, and 5% higher than for any topic received in 2017.
“The focus on long-term sustainability reflects a belief among healthcare executives that today’s margin pressures are permanent and structural in nature,” says Egan. “As a result, the current focus on cost control does not center on the types of temporary campaigns organizations have historically pursued to weather an economic downturn or a sudden shift in reimbursement policy.  Instead, executives are looking for strategies to permanently bend the expense curve; doing so will require radical improvements to cost structure, such as redesigning staffing models, rationalizing service lines across their market, and even transforming their facility footprint,” she says.

2.  Innovative approaches to expense reduction

For the second year in a row, C-Suite executives voted this as the No. 2 area of interest (56% of executives were extremely interested)

The healthcare cost problem has executives looking to go beyond the tried-and-true cost strategies of the past, according to Egan.

“Of particular interest today are strategies for controlling expense growth while avoiding mass lay-offs and other major drivers of employee disengagement,” she says. “Executives are also exploring the need to invest in innovative new technologies—like artificial intelligence—to drive drastic improvements in productivity and efficiency.”

3.  Exploring diversified, innovative revenue streams

This number 3 area of interest (56%) has ranked near the top for the past two years.

“Executives increasingly believe that relying on conventional determinants of market share—such as competing for referrals from independent physicians—will be insufficient for driving necessary levels of revenue growth,” Egan says. “Instead, hospitals and health systems are shifting their focus to include nontraditional sources of growth, such as contracting directly with employers, commercializing intellectual property, and launching innovation hubs.”

4.  Boosting outpatient procedural market share

This response has also ranked near the top for the past two years, with 50% of executives being extremely interested in this topic this year.

Technology advancements, reimbursement shifts, high deductibles, and evolving patient expectations continue the outmigration of care away from the inpatient setting, according to the survey.

“With lower barriers to entry in the outpatient setting, health systems find themselves in an increasingly competitive landscape, despite having made heavy investments in ambulatory care in recent years,” Egan says. “Successfully securing and growing outpatient market share will require hospitals and health systems to compete on the basis of convenience, service, and affordability—not just their clinical capabilities or brand.”

5.  Meeting rising consumer demands for service

According to the survey, 50% of executives are extremely interested in this topic.

“As transparency in healthcare has grown thanks to services such as Yelp, service experience is becoming more important than ever before,” Egan says. “Hospitals and health systems are also facing pressure from a growing number of consumer-focused competitors who are raising the bar on experience before, during, and after episodes of care.”

The goal, according to Egan, is to not only meet—but exceed—consumer expectations. For this, “executives will need to think holistically about improving patients’ experience with their system, from the moment they search for a provider to the point at which they ultimately pay their bill,” she says.




The tech giant is looking to the former exec for guidance on addressing healthcare improvement in a way that could reduce burden on providers.

Toby Cosgrove, MD, the Cleveland Clinic’s former top executive, will share a stage Tuesday afternoon with several colleagues from his new employer: Google.

Cosgrove, who served as the clinic’s CEO from 2004 through 2017, signed on as an executive advisor to the Google Cloud Healthcare and Life Sciences team, the company announced in a blog post last week. An update to his LinkedIn profile indicates he’s been in the role since January.

As part of his new role, Cosgrove will join National Institutes of Health Chief Information Officer Andrea Norris for a conversation Tuesday about how advances in cloud computing are changing healthcare.

Those advances can help stakeholders go beyond achieving the triple-aim of healthcare improvement—better patient experience, improved population health, and reduced cost—to add a fourth aim, according to Gregory J. Moore, MD, PhD, vice president of healthcare for Google Cloud, who will moderate the conversation.

Although advances in technology have added to the recordkeeping burden on healthcare workers, people like Cosgrove can help companies like Google improve the work experience of physicians and their staff, Moore wrote in the blog post.

“Technology may have been the cause of some of these challenges, but we believe that it can also be the cure,” Moore wrote.

Cosgrove, who retired from Cleveland Clinic in January, also joined the board of Denver-based healthcare IT company RxRevu, as HealthLeaders Media reported last month.

Cosgrove’s successor, Tomislav “Tom” Mihaljevic, MD, has been the clinic’s CEO since January.


68% of CEOs say they were not prepared for job

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Confidence is one of the defining characteristics of successful executives, but few CEOs felt prepared for their responsibilities, according to a survey in the Harvard Business Review.

Leadership advisory firm Egon Zehnder surveyed 402 CEOs from 11 countries between January and November 2017 and asked them questions regarding the challenges of stepping into a leadership position.

Four things to know:

1. There is no role that matches the demands of a CEO, and 68 percent of respondents said that, in hindsight, they weren’t fully prepared to take on the job.

2. Every CEO wants to drive culture change, but 50 percent of respondents said the task was more difficult than they expected.

3. Most CEOs know that they are only as effective as the people they surround themselves with, but 47 percent said that developing their senior leadership team was surprisingly challenging.

4. Forty-eight percent said that finding the time for self-reflection was harder than they anticipated.



The No. 1 priority for hospital CEOs? Cost control

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Cost control surpassed revenue growth as the top priority for hospital and health system CEOs in 2018, according to the Advisory Board’s Annual Health Care CEO Survey.

The nationwide survey, conducted between December 2017 and March 2018, included the responses of 146 C-suite executives from hospitals and health systems. Sixty-two percent of those surveyed identified preparing their organization for sustainable cost control as their foremost priority — the most for any concern outlined in the survey during the past four years.

“Health system CEOs recognize that any effective growth or financial-sustainability strategy must be built on a competitive cost structure in order for their enterprises to deliver high-quality, cost-effective care to the patients they serve,” Christopher Kerns, executive director of research at the Advisory Board, said in the organization’s July 11 statement. “The entrance of nontraditional healthcare providers … adds to the urgency of health systems improving cost structures.”

The survey analyzed executives’ responses and level of concern for 33 topics. Here are the top five areas of extreme interest hospital and health system CEOs selected as their No. 1 priority:

1. Preparing the enterprise for sustainable cost control — 62 percent
2. Innovative approaches to expense reduction — 56 percent
3. Exploring diversified, innovative revenue streams — 56 percent
4. Boosting outpatient procedural market share — 50 percent
5. Meeting rising consumer demands for service — 50 percent


Healthcare CEO gets prison time for role in $19.4M kickback scheme

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The former CEO of American Senior Communities, an Indianapolis-based skilled nursing and rehabilitation provider, was sentenced June 29 to nine and a half years in prison for his role in a fraud, kickback and money laundering conspiracy, according to the Department of Justice.

Federal agents began their investigation into James Burkhart three years ago. In September 2015, agents executed search warrants of his residence and ASC office. About a year later, Mr. Burkhart and three others — Daniel Benson, the former COO of American Senior Communities; Steven Ganote, an associate; and Joshua Burkhart, Mr. Burkhart’s younger brother — were indicted by a federal grand jury. All of the defendants, including Mr. Burkhart, had pleaded guilty to federal felony charges by January 2018.

Mr. Burkhart and his co-conspirators were accused of creating shell companies that would inflate vendors’ bills and submit them to ASC as if the shell companies were the real vendors. He also caused vendors or shell companies to submit false bills to ASC for fictitious services that were never provided, and, in some cases, demanded vendors pay him kickbacks in exchange for allowing them to service ASC’s large number of facilities.

In addition, Mr. Burkhart had vendors inflate their bills to ASC, which he would pay with money from Health & Hospital Corp. of Marion County, the public health department that operates several Indianapolis hospitals. The vendors would allegedly kick the overage back to Mr. Burkhart and his co-conspirators.

According to the DOJ, Mr. Burkhart and his co-conspirators funneled nearly $19.4 million to themselves through the scheme. The majority of the funds came from Health & Hospital Corp. of Marion County.

Mr. Burkhart was sentenced to prison after pleading guilty to three felony offenses: conspiracy to commit fraud, conspiracy to violate the healthcare Anti-Kickback Statute and money laundering.