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- [00:00]
A
This is Madeline Ashley with the Becker CFO and Revenue Cycle podcast. And I'm so excited to be joined today by Jeff Sandeen, executive Vice President and CFO of Vandalia Health. Jeff, thank you for joining me.
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B
Thanks, Madeline. I'm much appreciated.
- [00:15]
A
So, Jeff, before we begin, do you mind sharing with our listeners a little bit about yourself, your background and more on Vandalia Health?
- [00:23]
B
Yeah, I'd love to. Love to. You know, I've been in healthcare, you know, for many years, probably close to 30 years, and had a really broad experience in healthcare. On the audit side, reimbursement, I've worked for not for profit health systems. I've worked for for profit systems, large academic medical centers. I've had different roles, regional cfo, regional chief operational officer roles, been a president of our health of a health plan, chief integration officer role. So I've had a really broad, deep experience across the healthcare continuum, most recently joining Vandalia Health. For the last nine years, Vandalia Health has had significant growth. We currently have 14 owned hospitals, three managed with our 15th hospital that just broke ground that will open next year. So in a short period of three years, we have grown from four hospitals to 17 hospitals with our latest one coming on board next year. So, been a long career in healthcare. I've loved every minute of it just because of all the changes and challenges that come with the industry.
- [01:28]
A
Wonderful. Thank you so much for sharing that. So as you mentioned, you've been in the industry for, I think you said around 30 years. So obviously the industry is changing constantly. But I would be so curious to hear maybe two to three trends that you're keeping a close watch on right now from a financial perspective and why these trends are so important to you.
- [01:49]
B
Yeah, you know, probably the one I won't touch on just because of the unknown is just the whole government shutdown happening right now. But we're all watching that very closely. But really, you know, from a biggest trend is the reimbursement. Reimbursement is probably the first and foremost. The big beautiful bill obviously had impact depending on which state you're in. Medicaid cuts, you know, over the next seven years are going to be significant to most states. West Virginia is planning on losing about a billion dollars of Medicaid reimbursement over that period of time. You know, we're watching what does eligibility look like from the work requirements, you know, and then on the Medicare side, we're really, even though it didn't really have a big impact this year, we're really Looking at the reductions that are going to be coming down the next several years, site of service reductions, critical access rules and regulations. 340B is always a big part of what we're looking at too from how it helps us be a safety net facility. We're level one trauma here in Charleston and so reimbursement is obviously a big area of focus for us. We're about 80% governmental and so we always have a challenge of the governmentals not covering the cost of health care and what that does from a standpoint of shifting. So reimbursement obviously is going to be probably number one for me for the next several years as we really kind of get an understanding of what's going to be coming down the pike. On a positive note, areas that we're focused on is really innovation. AI innovation has been just tremendous. What's happening. We probably all have bots that are doing keystroke kind of work for us to minimize some of the human interaction. But really we're really launching into some of the AI agents that are really helping us from a coding perspective. Variety of different revenue cycle denial management. It's really going to change our healthcare environment. And so we're really investing heavily in the technology of AI and how it can help. There's just not enough folks to do the work that we need in healthcare today. And I think AI innovation is going to be crucial for that. If you ever kind of go into the Oracle website and take a look at what they're doing from an ambient listening technology perspective, it is tremendous what it's been able to do from a physician to patient interaction. But the byproducts are physicians don't have to go home and do their clinical notes at night, so their pajama time is less. But what we're seeing from an ROI perspective is folks are able to see more patients. The note is more complete and we're actually seeing additional reimbursement because of the fact the note is more complete for coding folks when they look at. Yeah, and the last area, if we have time for it, is just really the move to value. We're really focused on where that's going to happen over the next five to seven years. We have a clinically integrated network. We have about 135,000 folks that are covered under our SIN, which also includes our ACO. So we're moving to risk over the next couple years as we progress with our ACO model. But I see more and more of our payers, the government payers, are moving us toward Quality, which then equals risk. And so that shift continues to happen. And so our entire company is really trying to make sure we're ready for that move to value away from the fee for service.
- [04:57]
A
Thank you for sharing that. And one thing I wanted to circle back on that you mentioned, you just said at the beginning of the podcast that in a period of three years, you've grown to 17 hospitals. So just with the one big beautiful Bill act and all the unknowns there, I would say. Have you discussed or looked into tapping into that rural health transformation program for your hospitals? I know that that application is due, I think the 5th of November, and I know it's up to the states, not the hospitals, but any thoughts there, y'?
- [05:31]
B
All? Great question. And yes, we have. I'm sure all the health systems in the states have applied. You know, we're working in collaboration with our hospital association to have all healthcare kind of bring together ideas. Our health system individually applied, but our hospital association together came up with five different initiatives to bring forward to the governor and his office really is going to package. I think I heard today we had about 220 different organizations that applied for those dollars, which is great because I think there's some very unique ideas of how we can impact rural healthcare. West Virginia, like a lot of states, has, you know, the, the cities where a lot of people live, but then you get outside the cities and it's very rural. West Virginia has a lot of mountains, so that the terrain is very difficult. So there's a huge need in the state of West Virginia. And so we do hope, we, we all know that each state is going to get $100 million for the next five years, but there's additional dollars that are available as well. So we hope we can attract some of those dollars to our health system, but also I think for some of the other organizations that are going to be able to help connect some of the rural healthcare as well.
- [06:36]
A
Right. And you mentioned that Vandalia did apply to the state, you know, for consideration, correct? Mm, yeah. And so can you walk me through a little bit about what that application process was like? And also just in terms of, like, how you keep your financial team up to date with all these changes that we're seeing. It's kind of just on a day to day basis of it. We're getting new updates here and there.
- [06:59]
B
Yeah, it's, you know, it's a constant challenge, obviously, of how we continue to share information. But our, I tell you, from a finance team, we really keep a tight communication link with Our executive teams across our system, just to make sure they all understand we're right in the middle of our budget process. It's our strategic planning process right now. So the applications that went into the state obviously were all centered around things that we were doing today because part of the goal of the application is it has to be sustainable. It just can't be for five years and then end. So we really went into all the initiatives that we had. You know, our clinically integrated network is doing a ton of work around food disparities, the social determinants of health, all the different things we have in our state. We just were taking it from a smaller scale and we really were, I'll say, you know, taking it statewide from an initiative perspective. And so telehealth is a big component. When you think of all the mountainous train that we have here, people can't afford to travel up the turnpike, they maybe don't have a vehicle. So our telemedicine network that we've developed since COVID we want to take that really statewide. And then the other component that we've done is we've added significant amount of resources on our mobile medicine CTs, mammography clinics that are part of a fleet that we want to continue to grow. And I'll tell you, when we get to some of these communities and they haven't had a mammography for five to ten years, you, you know, we really are bringing care back to our communities in a more, you know, hands on focus that we want to be able to expand that because we know we can keep that going even after the five years is finished.
- [08:32]
A
Right. So you would be investing most of the funding should you get it into that telemedicine area, which is, again, like you said, so important given just the rural landscape of West Virginia. So no, I appreciate you sharing. Could you. And we touched on this a little bit as well. But I'd love to hear what you're most excited about right now. At Vandalia. We talked about the growth that you guys have seen seen in the last few years. Anything that you're really looking forward to.
- [08:56]
B
Well, you know, I always say this too, that, you know, yes, there's a lot of challenges in healthcare, but there's a lot of opportunities in healthcare. And you know, I think the growth that we've had over the last three years, I look at it now as we're gonna continue to have organic growth. We have a little over $200 million of projects that have already started from buildings of the new hospital up in Harrison county, we have a new rehab hospital that'll be starting here in Charleston. And we have what we call our access clinic sites that will be throughout our region that have started construction that will finish over the next 18 to 24 months. So for me, that's really centered around how do we improve access in our communities that we serve. And I call that our organic growth. I'll tell you, the healthcare continues to change. From the standpoint of the relationships that we have with a lot of different organizations, those conversations are only going to continue. And I think that it's not going to be this normal model of organizations coming together. I think there's going to be different alignments and different partnerships that are going to form from these. From the need of health care continuing, needing to evolve. It's no different than a lot of industries. When you look at consolidation that happens, that's only going to be very similar for health care, and that's only going to continue not in the state of West Virginia, but even outside of our. Our state is going to continue from a consolidation perspective.
- [10:13]
A
Yeah. And with all this growth that Vandalia Health has seen over the last few years and the investment in your new hospital, what does growth look like to you over the next one to two years, even?
- [10:24]
B
Yeah, you know, for us, a lot of it is we're continuing to integrate our emr. We're a Cerner Oracle shop. And so a big part of our growth in really achieving the next level of integration is. Is through our emr, and that'll be over the next couple of years. We'll have that project closely finished. You know, it's always a challenge, but that's a big part of what. All of our growth that we've brought on board to make it really work more seamlessly together, we'll have having one emr, one platform across our entire system. I'll tell you some of the other kind of conversations that we continue having. I think those are going to continue to flourish over this next 12 to 18 months that allow, I think, as a system for us to continue to grow and do more things even outside of the state of West Virginia.
- [11:07]
A
That is so exciting to hear for any other system financial leaders that are also looking to implement this type of growth that Vandalia has seen. What advice would you give them?
- [11:19]
B
Well, I think you can. You can never. You never know who's really ready to make, you know, kind of that leap as it relates to relationships. And so, because we were talking to a lot of different organizations that we thought were kind of ready to kind of take on a different partnership role or alignment role. And it really has been some of these kind of very minor conversations that turned into something very large from the standpoint of what we did with Mon Health System and our Davis Health System kind of joined our joined informed Vandalia three years ago. So you always have to have conversations going. You always have to be thinking of, think of the business differently than you did yesterday because it's continuing to change. And so for those that aren't thinking of what it's going to look like tomorrow, you're going to fall behind. And so you definitely need to be thinking of what's happening in the landscape of health care and how are you going to meet those challenges. And part of it is finding those relationships and potential affiliations that can help make you stronger.
- [12:16]
A
Yeah, some great advice there. Well, Jeff, thank you so much for taking the time to connect with me. It's been a pleasure speaking with you and hearing about all of the growth and just investments going on right now at Vandalia Health. And I'm so excited to connect with you again down the line.
- [12:30]
B
That sounds great. Thanks, Madeline. Much appreciated.