HFMA's biennial career and compensation guide: featuring results of HFP1A's 2005 Compensation Survey

Healthcare Financial Management, July, 2005

"Historically, these weren't necessarily part of the CFO role. But the role has changed and I see it continuing to grow into something that helps drive the organization. The broader your understanding of the organization or system, the more valuable you will be. If you understand the operational side, it will help you make recommendations that are consistent with the best interests of the hospital."

A good place to gain that understanding, says Crunk, is in a rural setting like Central Texas Medical Center. "Often you can play more roles in a small hospital that doesn't have as many specialized and support staff. Where a large facility might have a vice president of managed care or strategic planning, a small facility may expect you to handle contracts and get involved in marketing. The same principles apply, but you may have more opportunities."

Independent hospitals may offer a similar opportunity for finance people to take on more nontraditional responsibilities. As a financially stable and successful community hospital that does not belong to a system, the Community Hospital of the Monterey Peninsula is something of a rarity in California today. Likewise its CFO: Zehm has spent almost her entire career at the same hospital, moving up from reimbursement specialist to her present position over a period of 23 years. Like Sanders, she is very involved in a major building project, adding 50 beds to the 173-bed hospital, which currently has a 90 percent occupancy rate.

Information management, says Zehm, is a good example of an essential area that she has been able to learn on the job, thanks in large part to her vice president of medical affairs, who is an expert at benchmarking and quality controls. "Everybody talks about the revenue cycle now, but the revenue cycle has gone the way of the CFO job. It's not just about sending out bills and collecting money; it's about managing the revenue process. It's about knowing what to measure and getting the information in the hands of the line staff, so they know what is working and what is not working, and why."

Pay for Performance

Kovner couldn't agree more. In addition to being an academic, he is on the board of one large medical center and a consultant to the physicians at another. Kovner believes that the best way to prepare for the role of CFO today is to become an information expert.

"The conventional wisdom is that you should become an expert in reimbursement, but I would say don't bother," says Kovner. "Payment to hospitals is going to change radically and incredibly fast. For the long term, if you really want to get behind the numbers in finance, you've got to be able to set measurable objectives in advance for the appropriate business units."

This means breaking down some of the artificial barriers between financial, operational, and clinical performance. "How do you judge the OB unit in financial terms when historically you haven't kept your data by department or division? Most big hospitals are in 14 different businesses, and the financial performance is different in each."