No Guarantees, Only Opportunities: An Interview with Rodney J. Lisonbee - Intermountain Health Care Inc - Interview

Healthcare Financial Management, Sept, 2000 by Rodney J. Lisonbee

Rodney J. Lisonbee, MAcc, CPA, is chief financial officer of the Urban South Region of Intermountain Health Care. IHC is a vertically integrated, not-for-profit healthcare system providing service in Utah and Idaho. Operations of the Urban South Region include three hospitals, seven physician clinics, and a home healthcare agency.

Lisonbee's entire career in health care has been with Intermountain. He joined the organization in 1985 as director of accounting for Intermountain's LDS Hospital in Salt Lake City, Utah and assumed the CFO position with the Urban South Region in 1988.

HFM: What are your responsibilities as the CFO of Intermountain Health Care's Urban South Region?

Lisonbee: The region includes three hospitals: a tertiary care hospital, a family practice hospital that focuses primarily on obstetrics, and a community hospital on the verge of becoming a secondary care hospital. As CFO, my primary responsibilities are for accounting, budgeting, reimbursement, patient accounting, and health information services.

HFM: How would you compare your responsibilities with those of your counterparts employed in other systems?

Lisonbee: The CFOs in for-profit operations have responsibilities associated with income taxes and the planning functions that go with income-tax liability. Those responsibilities would present new opportunities--or challenges--for someone with a not-for-profit background. On the other hand, I probably spend more time dealing with property-tax issues than do my for-profit counterparts, simply because we must go through a very rigorous process of demonstrating to taxing bodies that we, indeed, qualify for property-tax exemption.

I also think that my peers in for-profit organizations, while concerned with enhancing quality of care for patients, also must maintain a focus on the issue of providing value for their shareholders. Being part of a not-for-profit organization, I have the same focus on quality of care and value to patients, but I am also focused on providing value to the community. An investment decision made at an organization like IHC might not show a return on the investment directly, like a for-profit might be required to, because that investment was made to enhance community benefits and value.

HFM: So what are some of the investment priorities for IHC?

Lisonbee: We are at one of those cyclical points where we need to make significant investments in property, physical plants, and equipment. Urban South is the first region of IHC to begin doing that.

We have just completed a $60 million expansion of our tertiary care facility and are preparing to start another project there in the next six months, one with a $20 million price tag. And in June we began a $30 million expansion project at our secondary care hospital. As you might imagine, in the very uncertain financial climate of health care today it is a significant challenge to make that level of investment and still maintain financial viability and strength for the long run.

HFM: Beyond IHC-specific initiatives, what healthcare issues concern you most?

Lisonbee: There is no question: payment. Whether it is private-payer reimbursement or Medicare payments, we are all struggling for our share of limited healthcare dollars. Right behind revenues, of course, is controlling healthcare costs.

We all hope there might be some reform-meaning additional dollars--be it from the government or from private insurers. But I think the reality is that dollars are going to remain limited and it will be our responsibility as providers to find solutions--to make the dollars we have go further.

HFM: What do you see as the CFO's role in this scenario?

Lisonbee: It is even more critical for the CFO to be involved in administrative operations. The integrated nature of the IHC system has given me a somewhat unique opportunity to actually take part in meetings between our health plan professionals and local employers and listen as our people try to explain to the employers why their health insurance rates are going up. It certainly helps me when I return to the hospital and have to be an advocate for cost containment

HFM: Does your position involve any responsibility for regulatory compliance programs and, if so, what is your role?

Lisonbee: Initially, I was the designated compliance officer and I pursued that responsibility quite diligently--to the point that I was concerned I might be neglecting some of my other responsibilities. We've recently shifted that compliance function to another administrative officer within the organization; the scope of my CFO responsibilities, however, will always require a significant degree of compliance involvement.

Most organizations, IHC among them, have a sincere and dedicated commitment to compliance. But I think over the past few years the increased scrutiny by the OIG and other Federal regulatory agencies has made us significantly more vigilant.

HFM: Another governmental issue in the forefront lately is Medicare's outpatient prospective payment system. What are the ramifications of this new payment system for your region of Intermountain? What do you expect to happen following the implementation of the system August 1?