The hospital CFO’s role has expanded thanks to healthcare reform, including taking a more hands-on approach to supply chain management.
“I think the CFO now is really seen as more of a business partner and advisor than ever before, but that also comes with needing a different set of skills,” said Angela Zotos, principal, advisory services at Ernst & Young. “You're seeing CFOs who have traditionally been relegated to focusing on bottom line numbers, to being a part of engaging with clinicians, collaborating with physicians, especially as you think about moving to value-based payments.”
[See also: Finding the perfect hospital CFO.]
From a cost management and budgeting perspective, getting involved in supply chain management is natural for today’s CFOs, said Adam Higman, president and consultant at Soyring Consulting.
“CFOs are often the ones that are driving the organization when it comes to identifying waste and implementing changes to create savings,” he said.
Intermountain Healthcare’s CFO, Bert Zimmerli, has been instrumental in the organization’s changeover to a self-distribution model called the Supply Chain Organization, said Brent Johnson, the organization's vice president of supply chain and support services.
[See also: Supply chain efficiency trends.]
Through it’s supply chain management, Intermountain Healthcare has documented savings of over $250 million over the past five years, said Johnson. “I think it very critical that CFOs and CEOs understand the value of supply chain with regards to surviving healthcare reform,” said Johnson.
Zimmerli, Johnson said, gets it, and was willing to invest $40 million into the organization’s supply chain center in 2011-2012.
“He challenges the organization to always use the Supply Chain Organization for all purchases and transactions.”
This level of engagement with an area not traditionally considered part of a CFO’s job is typical of the sort of changed expectations for CFOs that have taken place in the last four to five years, said Brian Meadows, Americas advisory supply chain and operations leader and principal at Ernst & Young. “We’ve reached the day now where I think more of a system view of the enterprise requires more end-to-end thoughtfulness on how to drive productivity and better performance.”