← Becker’s Healthcare Podcast
Becker’s Healthcare Podcast
Eric J. Price, MBA, Chief Financial Officer of Schoolcraft Memorial Hospital
00:25:04
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- [00:00]
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Health.Com this is Laura Deardo with the Beckers Healthcare Podcast. I'm thrilled today to be joined by Eric J. Price, Chief Financial Officer of Schoolcraft Memorial Hospital. Eric, it's a pleasure to have you on the podcast today.
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A
Thank you, Laura. Pleasure to be here.
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B
Now, I'm really excited for our conversation because I know there's so much happening in health care today, really a lot of fascinating innovations as well as challenges. And I'm excited to hear your perspective on this as well as you know, where we're headed in the future. But before we dive in, I'm curious, can you tell us a little bit more yourself about yourself as well as Schoolcraft Memorial?
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Yes, I myself, I'm an accountant by trade. You know, spent some of my early professional years working in broadcast media. I worked for an NBC affiliate. I've done global logistics. You know, back in 2010 I was part of a corporation that helped build a wholly owned foreign entity company in Shanghai, China, and got Into Healthcare in 2011, right as the Affordable Care act came into effect. And it coincided with me obtaining my master's in business. And I've been in the either CFO or senior financial executive since 2011 in a variety of healthcare settings in a variety of states. And that's kind of where I how I got I got to Michigan about two and a half years ago myself. I'm pursuing a doctorate in healthcare administration at Central Michigan University, and Rural healthcare is where my passion is in Manistique, Michigan and Schoolcraft Memorial Hospital were a great fit for me professionally and personally. And that's kind of how I got to this point.
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B
I love that, you know, what a great path to be in this position as the CFO of a hospital and especially in rural healthcare. Like you said, you know, it's such an important community and place to be in right now and certainly a much needed service to those communities as well. So from your perspective, could you tell us a little bit about the biggest winner success story from the last year or so?
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I think the biggest win for our facility and our community has been we've been fortunate to be able to invest into some technology, both radiology, anesthesia equipment. I think we've seen the advent of Better technology in the diagnostic space. And that's been a huge boon to us as an entity in the community. And we've also been successful in training and working with our managers to help them kind of understand the complexities facing healthcare systems. Not just the clinical delivery, but the financial impact. And I feel that we as a team are better positioned and prepared to respond to the challenges coming down the pipeline. And it's not just the CFO making decisions in a vacuum, but we have a comprehensive. Our senior leadership team, they've been great at digging into some of the regulations around cost reporting. Probably the final big thing that's been a huge boon to us is we worked with a vendor to create better data analytics, to see how we are doing currently, as well as starting to get better predictive analytics, which in a small rural healthcare setting is quite fascinating. It's really exciting time to be here.
- [03:40]
B
It is amazing to hear. I think, to your point, technology is something that has become so ubiquitous in healthcare, really touching every department and every aspect of operations as well as care delivery. And I know it can sometimes, sometimes be a challenge to acquire the technology and the right data analytics and more especially within the rural healthcare setting. What's been the difference maker for you? How have you been able to prioritize, you know, bringing this technology into your facility and integrating it on a broader scale?
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Well, I was very fortunate when I first got here, our radiology director, he had been working with our CEO at the time with the USDA to get a grant for some equipment. And so we were, you know, we were able to access some of that federal funding available to rural healthcare centers. That was kind of a, I kind of walked into that situation, which was very fortunate for this, for this facility. But the biggest thing I think for us has been we as a facility implemented a new EHR in 2020. And of course the timing was a little difficult with the pandemic and all that, the constraints that created. But we're at a point where our processes have matured and we're starting to see better data in our claims processing information in our visits. And we did invest in a kind of a quality, both quality and informatics team. And that team has been able to give the senior leadership and decision makers, including our board of directors, data that really helps us understand how we're doing, where we have opportunities for improvement, where we're doing well and where we can actually improve how we're delivering our care to our community. You know, demographic information, comorbidities, that patient centered type information that you might want to have to kind of plan for. We now have that information whereas two or three years ago we just didn't have enough data to see trending. But we've been in our EHR now for five plus years and with that maturation of the process, we're getting better information to make decisions versus just data that we kind of. You can get a lot of data, but until it converts to information and actionable intel. But that's one of our biggest wins and some of the biggest strengths I think this community has and this hospital has is really good, solid data that's.
- [06:06]
B
Amazing to hear and I know that can make a huge difference in what you're able to do from just the care delivery side, the outcomes that you have in really being able to successfully, really care for your communities. Now, in looking at the situation more globally, what are the top two to three issues you're focused on right now? Especially given all the changes within the healthcare and broader policy economy and more right now. What's top of mind for you?
- [06:32]
A
You know, I, I again I've been doing this route 15 years now. I'm in my 15th year and I when I talk to my senior leadership team, we talk about the challenges ahead of us. It seems to me that maybe it was a Becker's article I read back in 2012 that talks about healthcare is going through an era of transformational change and that was with the policy change. Back with the Affordable Care act, we've seen revisions, amendments, we've had a global pandemic, we've had different federal policy directives, different initiatives. I think the biggest opportunity for a, a smaller rural hospital is to identify why are these things occurring. Why does the federal government want to address this issue versus why does CMS look at this issue differently and to really understand what is the intent. And I think that with the data we've had available to us, we can see what's happening. The financial challenges. I think every rural healthcare facility you know probably wishes they had another two or three million dollars of capital to invest in and probably 10 more FTE to support. We've invested where we can and we are taking proactive steps to adopt some of the exciting technologies like AI. Our chief Information officer is very pro looking at AI to help improve efficiencies. And we are actually, we decided to hold off on getting some new CT equipment this year. We want to see how AI may impact that space to give us better radiology diagnostic equipment. Some of the exciting advances would be the ability to detect risk factors for heart disease, but we don't have currently available. We do it through some diagnostic testing, but the technology is advancing and that's exciting for us to be able to deliver that kind of care to our community. Of course there's risks. You know, I think everybody in the financial sector of healthcare right now is. There's a lot of uncertainty with, you know, the Medicaid program. And we as an entity, I feel, have been able to effectively analyze the risk. We know where our Medicaid utilization is by service category. We know what our demographic looks like. And so we can kind of predict where we may have concern for economic, you know, constraints in the future. But also it helps us understand that we have opportunities. And, you know, I think that I have chosen to stay in healthcare as a financial executive despite all these challenges because it is a dynamic and rewarding area to be in. Is it. Is it stressful? Absolutely. You know, anyone out there listening who may be, you know, looking at your financials and trying to figure out what's going to happen with, you know, this winter and changes in 2027, just know that I think every CFO that I've spoken with and every financial officer or, you know, controller or financial individual, we share similar concerns. And we're kind of in a wait and see because each state, I think, will roll out their own, you know, kind of forecast of impact to the Medicaid programs. And so in many cases the past 15 years, it's been kind of wait and see. We actually been proactive with our legislative entities locally. You know, we drafted letters, given data. I think I spoke at a local county commissioner's conference about two or three months ago, and we've been very good about trying to alleviate concerns, ensure that the narrative internally is factual. And we, I feel, are positioned well where we become. We probably could have better predictive analytics, but again, we have good data that we didn't have five years ago. If these changes have been thrust on this organization, you know, four or five years ago, it probably would have been a much more daunting proposition. But I feel like the senior leadership team here. I'm the newest member of the team currently, and I have two and a half years of tenure with the hospital. So we have a well tenured team and some pretty experienced leaders at the helm of this organization, which is a huge comfort and boon for the community and for the hospital.
- [11:03]
B
That's amazing to hear. And, you know, certainly being able to have that strong team and core in place will make a big difference as you're Looking to the future and adjusting to any of the challenges that come up, any of the changes that might be ahead. You know, it's really refreshing to understand how you're thinking about these things, especially looking at the impact of, you know, the potential Medicaid changes coming down the pipe, both as you know, you mentioned, on the federal and then local level, taking a look in, you know, scenario planning for some of those things. And so I think it makes a lot of sense to take that measured approach as well as lean on technology where possible, to really be aggressive on how you can support your teams and really figure out how you can boost care in the meantime. So I think that makes a lot of sense and it sounds like a really strong strategy and plan headed into even an uncertain future.
- [11:58]
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And part of that strategy has been, I failed to mention earlier on, but we've had some pretty amazing growth in our facility as far as patients accessing our services. And so that has actually given us an advantage where our volumes are increasing and through that volume, patients are choosing us. I think they're seeing we have good quality care and that alleviates some of the financial constraints. I think as volumes go down, there's always that concern of the impact on reimbursement. But we've been very fortuitous to have in pretty much most, if not all departments at least 3 to 4% growth year over year. Some of our departments have seen, you know, 35, 40% growth in volumes. And we've been able to with those efficiencies, actually in some areas we've been able to not have any cost increases to the community. And you know, we were managing our margin in such a way that the community is as best we can, they're being sheltered. Some of the high spikes that may have happened with, you know, for example, earlier this year, I think everybody was trying to find sailing solution due to the impacts of the hurricanes down in the south. We were fortuitous that we had fairly good stock on hand. And we've been looking at reducing or not increasing charges in certain areas because the data shows us that we're able to do so without negatively impacting our reimbursement. And again, as a critical access hospital, we may have a bit of an advantage there being cost based, reimbursed. And that's one thing we've really tried to address is, you know, let's, let's ensure we're maintaining solvency, evaluating growth and you know, increasing our ability to retain some of the earnings we have, but without doing massive, you know, Stretch goals on our margin. We're trying to maintain a competitive margin that's healthy, but not at the expense of the community. And that's been a huge, I think, regionally for our community. I mean, we've talked about this. The CEO has talked about this in town hall meetings. We've educated managers, and it. Quite frankly, I really hope that in the next two or three years, as we kind of finalize some of these projects we're working on, I'm hoping to see Schoolcraft Memorial Hospital be in the top 100 critical access hospitals, if not top 10 in the nation. We really have, I think, the raw materials and talent pool to make that happen. It's just marshaling those resources and being as effective and efficient as we can in this, you know, trying time. But again, I think every two or three years in healthcare, there's always a trying financial time. So I think it's kind of par for the course. And we, as an organization, I feel, have built some resiliency up in that. And instead of being reactive, we're being proactive. And how do we best navigate through some of these uncertain times at the same time, not sacrificing quality, ensuring the community has access to care and those things that at the core, fundamental reason why we're in business as a nonprofit hospital is to ensure that our community is healthy and not just today, but how do we improve health for the community for the next year, next five years, next 10 years? And those are the conversations we're having as a senior leadership team and as a board. And that is exciting to be part of.
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B
Absolutely. That's amazing to hear what a great goal that you have in terms of becoming one of the top critical access hospitals in the nation. I know that it takes a lot of work, effort and energy, but with the foundation you've built and the team you have there, that is so resilient and able to adjust as time goes on. I think that is amazing to hear what you've been able to do at Schoolcraft Memorial. And I think when you look at that goal and look at the spaces where you have grown over the next last few years, what is really the places or the big opportunities that you see for growth ahead? Where do you want to double down on and how do you see that continued patient volume growth as well as access and overall just being able to continue to evolve the organization?
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A
Yeah, one of the biggest opportunities for growth and call it cost management. I mean, that's cfy. I have to throw those buzzwords in a bit here. And there. But our clinic, both our rural health clinic and our specialty clinic, we've diversified our specialty clinic docs we have for a small critical access hospital we have a very dynamic employed group of physicians. You know, we have ent, orthopedic surgery, we have general surgery, podiatry, we have bariatric services, rheumatology, nephrology. And instead of ENT and instead of doing, you know, full time five days a week, we have rotating specialists where they're here two days doing clinic visits and maybe a day or two of procedures or, or space. And so I think the opportunity we have at would be providing access to our patients and community. We are looking to expand what we call our ready care program which is same day primary care visits. I think we've added two or three FTE in the past three years to accommodate that. And what that accomplishes is we're able to see patients with less severe medical maladies that come in during the week. I think we now have same day visits for rhc, budget affordance schedule. Of course occasionally you may have a provider out for PTO or out sick, but in general we have seven day coverage. What that has done for us is it has reduced the utilization in the er, which for both the hospital and I think the patients kind of high cost and for the insurance plans is a higher cost proposition. And we're seeing patients in a lower cost setting in the clinic. And that I think is one of our biggest areas for growth. And of course if you increase your clinic visits, then we're seeing radiology lab, some of those diagnostic services are increasing as well. So I think that's our biggest area. And I should mention that in 2022 the hospital did do an expansion that was about a year before I got here, but we expanded our rehab services department and we've seen big number changes there. I think the rehab service department saw around 40% growth year over year between 23 and 2022 because we have more space, we have more treatment rooms, we actually have an aquatic pool for people who may have mobility issues. And so I think our biggest opportunity is evaluating what the patient with opinion needs. I keep going back to the data analysis, but we're able to do some population health evaluations and identify, well, this patient came in for a, you know, ready care primary care visit. And during that visit we discovered, you know, there's some indicators of, you know, pre diabetes or whatever it may be. We're getting ahead of that. And instead of becoming emergent, you know, in six months a Year later, we're getting ahead of it and that, you know, that cost saving that happens by having people use our clinic, we're able to pass that to the community. It's just been a great opportunity for us. So those are some of the biggest opportunities we've had is just our, you know, being available for the community for same day visits and you know, being a good center for primary care.
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B
I love that. I think that's such a great synopsis of everything that, you know, you've been able to accomplish as well as what is looking ahead and just having that increased patient volume, adding what you can and then looking at those spaces where it really makes sense to provide additional services to the community. Now we've talked through a lot today and of course, as you mentioned, a transformational time in healthcare once again. What do you think it will take to lead a thriving organization over the next five years given those factors of what we've talked about in technology? In other challenges ahead, what are the best leaders doing in order to set themselves up for success?
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A
I think, you know, I, I read different trade journals and in conversations with, you know, whether it be a Michigan Hospital association conference or a national conference, I think the underlying theme that I've seen and that I, that I support and agree with would be understanding that AI is going to impact us. I think we'll have better analytical tools to help navigate, you know, individual patients health needs. And I feel there's an opportunity for us to reduce some of the costs that may have crept into, you know, diagnostic. You know, if you go see a doc and you're getting diagnosed and you're running a bunch of tests, I'm really hopeful that the technology that we have in front of us will help reduce the number of visits to get a effective diagnosis. That I think would be an opportunity. I also think that understanding, you know, Medicare and CMS and state Medicaid payment plans and understanding the constraints that are being faced by the insurance industry would be a key factor for any CFO or financial executive to look at is we often get kind of caught in our own, you know, day to day operations, monthly financials, forecasting budgets, et cetera. But one thing that we've done local, locally, we've reached out to our local, you know, some of our payers, our larger payers, and have had conversations around, you know, hey, you know, this payment methodology, you know, you, we got to evaluate the rates because on one hand, you know, we're a self funded as far as our health insurance plan, we're Self funded. And so if I'm increasing charges in one area, well, that increase hits me, you know, on my insurance plan as well. And, and so I think in summary, what I'd recommend would be understanding your payer mix, understanding your payment model, where are the opportunities, where the risks and really have those conversations with the payers, you know, build that rapport. And, and for us, we've worked diligently to ensure that our cost reporting and our audits are as clean and accurate as possible. So that, you know, as we know, claims data and cost report data is looked at, you know, in aggregate at the national level from a policy decision making standpoint. And you know, even though we're a very, very small fish in this big pond of healthcare, we feel that we need to be as accurate as we can be in our financial operations and our financial presentations and our forecasts and analyses. Not for the sake of profit margin or budgetary impact, but for the sake of what does this mean to the community, how does this impact health outcomes? And if we invest in, you know, this today, what's the expected return on investment in four to five years? And that's, I think the biggest challenge for a small healthcare facility is getting out of the tactical day to day, you know, operational challenges and start looking at strategically, how do we grow as a leader. What I try to do is instill that knowledge and that information with my team so that the, my director level managers have as much information as I have so that they're making decisions independent and not waiting on the CFO to review and sign off on something. That's what we're trying to get to, so everyone understands, you know, if your role is to negotiate with a GPO group pay, you know, group purchasing organization, that you as the supply chain manager have the authority to do. So let me know if you have any questions on constraints or, you know, what we would put as a boundary or a goal. But I think the biggest thing is as a financial leader, don't lose sight of looking ahead because I think it's too easy to get caught in the day to day operational. And for us to be successful, we have to be thinking five years ahead, not next month.
- [24:21]
B
That's such a great point. Eric. Thank you so much for joining us on the podcast today. This has been a really informative discussion. I have learned a lot and certainly appreciate you sharing your perspective with us here. And I'm also looking forward to continuing this discussion at our CEO CFO Roundtable coming up in November. And it's just will be a great opportunity to connect with you and others and Learn from leaders, CEOs and CFOs in C suite teams from across the country. So I'm looking forward to seeing you there.
- [24:51]
A
Absolutely. Laura. Looking forward to seeing you as well. And until then, if you have any other questions, reach out. Absolutely. It was a pleasure being here, and I'm more than happy to, you know, follow up if you'd like to.