Becker's Hospital Review

12 CFO / FINANCE CFOs experienced in cutting costs, restructuring in high demand By Alan Condon F all is typically a period of increased CFO turnover as hospitals and health systems begin searches for new executives for the beginning of the following year, but the pressures associated with high inflation, a projected recession and the continued effects of the pandemic have led to more churn than usual for top financial positions, e Wall Street Journal reported Oct. 23 Many economists and financial experts are expecting a recession to hit the U.S. in early- to mid-2023. is is pushing some executives to switch roles now before the labor market changes. Many healthcare organizations are also preparing for a potential economic downturn by searching for CFOs who are experienced in cutting costs or restructuring operations, according to the report. Recession planning in healthcare is challenging because it can have both negative (payer mix, patient volume) and positive effects (decrease in labor and supply inflation) on financial performance, according to Daniel Morash, senior vice president of finance and CFO for Boston-based Brigham and Women's Hospital. "e best advice I would give is that hospitals need to consider recession scenarios when making long-term commitments on wage increases, capital expenditures and planning for capacity for patient access," Mr. Morash told Becker's Hospital Review. "Most of our focus needs to be on the acute challenges we are facing. Still, it's important to be careful not to overreact or overcommit financially when a recession could change a number of trends we're seeing now." n Healthcare lobbying spending rose 70% from 2000 to 2020 By Rylee Wilson Healthcare lobbying spending ballooned 70 percent from 2000 to 2020, a new study published in JAMA Health Forum found. e study, published Oct. 28, analyzed lobbying spending reports from nonpartisan organization OpenSecrets, which tracks money in politics. In 2020, healthcare lobbying expenditures totaled $713.6 million, compared to $358.2 million in 2000. According to the study, health product manufacturers spent the most on lobbying, followed by providers, then payers. Spending among payers was the most concentrated, however, with the top 10 percent of firms responsible for 70.4 percent of spending in that category in 2020. e authors, affiliated with New York City-based Weill Cornell Medicine and Philadelphia-based University of Pennsylvania, wrote that lobbying expenditures increased more sharply in the early 2000s, driven by lobbying efforts targeting the Affordable Care Act. n SSM Health reports $484M loss amid excess costs, investment problems By Nick Thomas S t. Louis-based SSM Health, which operates 23 hospitals and over 300 physician locations across four states, has revealed losses totaling over $484 million for the nine months of 2022 ending Sept. 30. That figure compares with a net income of $447.5 million for the same period in 2021. SSM Health, which also reported third-quarter losses of $93.3 million versus a gain in 2021 of $75.6 million, said the losses were due to pressure from increased labor and supply costs and declines on investment income even as operating revenue increased. Total debt for the healthcare organization as at Sept. 30 increased $98.1 million from Dec. 31, 2021, to total $2.6 billion and was "primarily due to working capital requirements and other initiatives," SSM Health said. Capital investment plans remain on track, management said, with current budget approval for $425 million for 2022 and similar numbers expected in the near future. The sources of such funding through fiscal year 2024 are expected to be cash from operations, philanthropy support and investment earnings. n

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