Before joining the system in January 2016, she was executive vice president and CFO of Catholic Health Services of Long Island, an integrated healthcare delivery system based in Rockville Centre, N.Y.
She was also executive vice president for finance and integrated services at Englewood, Colo.-based Catholic Health Initiatives.
Here, Ms. Blye shares her proudest moment as Montefiore’s CFO, discusses her daily mantra and reveals the revenue cycle tools she’s most excited about.
Question: Since joining Montefiore, what has been one of your proudest moments as CFO?
Colleen Blye: When we restructured the balance sheet last year and [pursued] public financing. This was the first time in Montefiore’s history that we went for a public rating. As a result, this refinancing provided much needed liquidity for our system, and it allowed us to level debt service. We now have a solid baseline going forward which offers us access to additional financing, as needed. That was a big deal and positions our organization with a debt structure appropriate for a system of our size and scale.
Q: What is the greatest challenge you faced as CFO in 2018? Do you expect this to be your biggest challenge in 2019 as well?
CB: One [challenge] is shifting the finance culture overall from one of financial reporting to one of analytics, and being a business partner. In today’s healthcare world, I think this is imperative, and Montefiore has embraced this culture. I think businesses separate from the healthcare environment operate this way, and we need to be responding and shifting so that finance is a true business partner throughout the organization.
The other aspect that I think is increasingly challenging for all of us in financial healthcare is trying to understand how to diversify our shrinking revenue base. There’s been a lot of revenue compression by governmental payers and the market in general. Therefore, it is imperative that we continually think about how we’re going to diversify that revenue base and bring in new revenue streams to facilitate growth.
Q: What is a daily mantra that informs your leadership decisions?
CB: I always use the concept, “Leave an organization better than you received it.” That doesn’t always mean having absolute analytics or support. Seasoned CFOs understand [that] you must use your experience and other intellect, in addition to data and supporting analysis, to determine whether the risk of any given business decision is worthwhile going forward.
Q: Montefiore Health System has 11 hospitals and serves 3 million people in communities across the Bronx, Westchester and the Hudson Valley. How does the system’s financial strategy differ by location?
CB: At the highest level, we are one system. However, every market has different opportunities, and it’s imperative that we find those opportunities and capitalize on them to benefit the patients, providers, communities, and therefore, the system overall.
Q: The system is bringing specialty care expertise in areas including cancer, advanced imaging, neuroscience, transplantation, musculoskeletal and heart and vascular care to new markets in its service region of four counties. How does this play a role in the system’s financial improvement plans?
CB: It’s certainly a big part. This goes back to diversifying the revenue stream and understanding where those opportunities are. Specialty care is a critical element of the future of healthcare. We’ve seen a significant shift from inpatient to outpatient care for the less complex services. But,it’s equally important to understand the more complex care as well, capturing that environment so we can take care of the whole person. From an economic point of view, it typically is that more complex care that produces some of the greater margins for our organization.
Q: What are your top cost containment strategies?
CB: We’re focused on all opportunities. One challenge many organizations have is to maintain a cost-focused culture while you’re trying to support growth to sustain the business. But we look at all aspects — how do we maintain our quality care yet utilize our size and scale to get efficiency? We’re constantly looking at that as it relates to our procurement strategy. We’re constantly looking at our employee and benefit cost structure. We [must] continually look at that resource consumption and make sure we’re spending wisely. As a system, our goal is to make sure that quality care is at the center of what we’re focused on but that we utilize who we are — scale and size — to maximize opportunities.
It’s [also] not just the cost side of the equation that we look at. To grow and sustain, we also have to grow our business. We have to be equally focused on where those growth opportunities lie for us as an organization, maintaining equal focused on our revenue efficiency to make certain we’re collecting every dollar we’re entitled to for the services we deliver.
Q: What new revenue cycle tool are you most excited about?
CB: The tools we’re most excited about are those that are patient-focused. Consumers, particularly millennials, expect and look for that convenience. We are working with vendors that transition a complex billing and information cycle. This enables us to communicate with our patients in a far more user-friendly way, We’re excited about these opportunities which are focused on patient-centered communications, allowing us to connect directly with patients, informing them at the earliest point about what their financial responsibilities are, how to interpret that information, and how to make payments on those responsibilities.
Q: If you could pass along one nugget of advice to another hospital CFO, what would it be?
CB: Always keep your eyes and ears open for opportunities and always think about how you can grow and expand your thinking and the perspective you bring to the work that you do.
I would also encourage thinking about how to become partners in the healthcare business. I think we have a calling now as CFOs to be far more involved in operations, rather than just financial reporting, providing data, trends and insight to our internal colleagues. I would really suggest moving from the traditional finance acumen to use those skills and techniques to be a strategic-thinking and better business partner.
Many senior finance executives are not fully prepared to manage the financial impact of evolving business conditions in today’s healthcare environment, according to a survey by strategic and financial consulting firm Kaufman Hall.
The survey, conducted in September and October, asked CFOs, vice presidents of finance, directors of finance, and other senior finance executives more than 20 questions to gauge performance management progress and trends. Participants represented more than 160 U.S. hospitals, health systems, and other healthcare organizations.
1. Only 13 percent of respondents said their organizations are very prepared to manage evolving payment and delivery models with the financial planning processes and tools now available.
2. Additionally, only 23 percent said they are very confident that their teams can quickly and easily adjust to strategies and plans.
3. Ninety-six percent of respondents said they believe their organizations should be making greater efforts to leverage financial and operational data as part of decision-making.
4. Cost reduction and management is the biggest priority for senior finance executives this year, followed by predicting and managing changing payment models.
5. Along those lines, more than half of respondents cited the following as top improvement priorities for financial planning and analysis:
- Cost management and efficiency
- Reporting and analysis to support decision-making
- Operational budgeting and forecasting
- Profitability measurement across specific dimensions
Recently we facilitated a day-long meeting for one of our clients who is looking to build a new governance model for their regional clinical enterprise. It’s a complex undertaking, requiring them to bring together a broad spectrum of stakeholders—their own employed medical group, a handful of independent groups with whom they’ve built partnerships over the years, a joint venture partner, the leaders of the system’s hospitals, and their academic affiliate. All of these relationships—each with its own decision-making structure and incentive model—have accreted over time but have not operated as a cohesive whole. Now, faced with an increasingly competitive marketplace, the system wants to build an overarching structure to coordinate the activities of the disparate constituents, and to allow them to go to market with a unified platform capable of delivering better value to consumers and purchasers.
In preparing for the meeting, we quickly realized that the crux of the problem is decision rights. Every initiative or major decision that the system wants to make is getting bogged down in an endless process of discussion, second-guessing, and turf battles between the constituent groups. In our session with the group, we shared our perspective that the most important part of designing any organizational structure is being very explicit about how decisions are going to get made. To that end, we provided with them a decision-making framework that we’ve seen implemented in other organizations, a variation on the RACI responsibility assignment matrix that’s been a mainstay in organizational science for decades.
At its heart, it’s a role-based decision process, in which different stakeholders are assigned discrete parts to play in coming to a decision. RACI is an acronym for four of the pivotal roles: Responsible, Accountable, Consulted, and Informed. There’s no magic to the specific framework—indeed, there’s a multitude of different flavors of RACI.
(We like the Bain & Company notion of asking “Who has the ‘D’”, or—to paraphrase George W. Bush—who’s the Decider?) Across the day, we introduced the framework, role-played making a specific decision using it, and then began to evaluate a strawman model for the unified clinical enterprise using the framework.
We’ll keep you posted as the model moves from evaluation to implementation, but we were struck by the power of having an explicit, concrete discussion around decision rights. Given the complexity and organizational inertia that characterize many healthcare organizations, taking the time to clarify who gets to make which decisions, and how, seems like a worthwhile endeavor.