Joe Gaylord, EVP and CFO of Fairview Health Services

Summary

Becker’s Healthcare Podcast Summary: Joe Gaylord, EVP and CFO of Fairview Health Services

Introduction

In the August 15, 2025 episode of the Becker’s Healthcare Podcast, host Laura Dardo engages in an insightful conversation with Joe Gaylord, Executive Vice President and Chief Financial Officer of Fairview Health Services. The episode delves into Fairview’s remarkable financial turnaround, operational strategies, workforce stability, and future growth opportunities, offering valuable perspectives for healthcare professionals and stakeholders.

Background on Fairview Health Services and Joe Gaylord

Joe Gaylord provides an overview of Fairview Health Services, highlighting its expansive operations:

• Facilities: 10 hospitals, including the Academic Medical Center partnering with University of Minnesota physicians in the Twin Cities, and two rural hospitals in northern Minnesota.
• Clinics and Services: 60 clinics, a senior living organization managing numerous facilities, and a substantial specialty pharmacy business.

Year in Review: Achievements and Financial Turnaround

One of the standout discussions centers on Fairview’s significant financial accomplishments over the past year. Joe emphasizes:

"We reported in 2024 our first operating profit in six years. And that was a roughly $600 million turnaround from our low point two years prior to that." [00:34]

This turnaround is attributed to:

• Broad-Based Improvements: Success across almost all business units.
• Quality Enhancements: Better patient experience scores, improved patient outcomes, and heightened employee engagement.
• Community Impact: Recognition through the Foster McGaugh Award from the American Hospital Association (AHA).

Building a Resilient Culture

Laura probes into the cultural factors behind Fairview’s success. Joe highlights the importance of resilience and strategic organizational structures:

"We've built the engines within organizationally, we have a transformation office that's incredibly effective... We feel great about our ability to adjust and to react to whatever might come our way and respond." [02:59]

Key elements include:

• Transformation Office: Identifies and implements key projects with significant impacts.
• Resilient Workforce: Adaptability to navigate healthcare’s evolving landscape.

Current Focus Areas

Joe outlines the top priorities driving Fairview’s ongoing success:

1. Continued Financial Turnaround: Maintaining operational and workforce discipline.

2. Workforce Development:

   • Nursing Vacancies: Reduction by 83%.
   • Turnovers: Decrease by 36%.

   "If you've got a stable workforce, you're much less reliant on transitionary workforce or travelers and so forth." [05:35]

3. Innovative Care Programs:

   • Hospital at Home: Enhancing patient access to care outside traditional hospital settings.
   • Empath Unit: A specialty mental health emergency department aimed at providing a more conducive environment for patients in crisis.

Workforce Stability and Its Impact

The conversation underscores the critical role of workforce stability in Fairview’s success:

"The cost is lower, your patients are having a more consistent experience, and we're delivering better outcomes." [05:35]

Benefits of a stable workforce include:

• Reduced Costs: Lower reliance on temporary staffing reduces expenses.
• Enhanced Patient Experience: Consistent care leads to improved patient satisfaction.
• Better Health Outcomes: Continuity in care contributes to more favorable patient results.

Future Growth Opportunities

Looking ahead, Joe discusses strategic opportunities for Fairview’s expansion:

• Enhancing Patient Access: Increasing availability of hospital beds and specialty clinics to meet patient needs promptly.

• Specialty Pharmacy Expansion:

  • Fairview Pharmacy Solutions: A dedicated business unit aimed at assisting other healthcare systems in optimizing their pharmacy operations.

  "We've created a separate business unit. We call it Fairview Pharmacy Solutions, where we're beginning to help other systems do the same thing." [08:24]

This focus not only improves patient outcomes by ensuring appropriate medication management but also reduces overall healthcare costs, garnering recognition from payers.

The Role of Specialty Pharmacy

The integration of specialty pharmacy into care delivery has been pivotal:

"Integrating that into the whole care delivery that we serve our patients with has had a tremendous impact." [08:24]

Key impacts include:

• Enhanced Medication Adherence: Pharmacists engage directly with patients to ensure proper medication usage.
• Cost Efficiency: Better medication management leads to reduced expenditures.
• Recognition by Payers: Positive feedback from insurers validates the effectiveness of the specialty pharmacy model.

Leadership and Future Outlook

In discussing leadership, Joe emphasizes the importance of a mission-driven approach:

"Being mission based and having that mission first mindset. ... to be the most human centered health system." [09:15]

Key leadership principles at Fairview include:

• Mission-First Mindset: Prioritizing patient-centric care drives innovation and performance.
• Empowerment of Employees: Encouraging every employee to act as a leader fosters a resilient and proactive organizational culture.
• Continuous Transformation: Ongoing adaptation and innovation are essential for sustained success.

Conclusion

The episode concludes with Laura expressing her appreciation and anticipation for future collaborations, underscoring the value of shared knowledge and networking within the healthcare community.

"It's been a pleasure today and looking forward to seeing everybody in November." [10:25]

Key Takeaways

• Financial Resurgence: Fairview Health Services achieved a $600 million turnaround, marked by balanced improvements across operations, quality of care, and community impact.

• Resilient Culture: A strong organizational structure and transformation office enable effective responses to healthcare challenges.

• Workforce Stability: Significant reductions in nursing vacancies and turnovers enhance patient care and operational efficiency.

• Innovative Care Models: Programs like Hospital at Home and the Empath Unit exemplify Fairview’s commitment to patient-centric innovation.

• Specialty Pharmacy Integration: Expanding the pharmacy business unit contributes to better patient outcomes and cost savings.

• Mission-Driven Leadership: Placing the mission at the forefront fosters a culture of resilience, innovation, and exceptional service.

This comprehensive discussion with Joe Gaylord offers valuable insights into effective healthcare management, emphasizing the interplay between financial stability, workforce satisfaction, and innovative patient care strategies. Fairview Health Services serves as a compelling model for other healthcare organizations aiming to achieve similar multifaceted success.

Transcript

[A]

This is Laura Dardo with the Beckers Healthcare podcast. I'm thrilled today to be joined by Joe Gaylord, executive Vice president and Chief Financial Officer at Fairview Health Services. Joe, it's a pleasure to have you on the podcast today.

[B]

Hi, Laura. It's great to be here.

[A]

Well, I'm excited to have you because I know it's such an interesting time in healthcare day and truly, you know, you're doing some innovative things at Fairview. And so I'll be excited to dig in there as well as get your perspective on how to think about the future. But before we dive in, I'm wondering, can you tell us a little bit about yourself and Fairview Health Services? What's your biggest win or success story from the last year?

[B]

Yeah, as you said, my name is Joe Gaylord. I'm the chief Financial Officer for Fairview Health services. We operate 10 hospitals, including the academic Medical center where University of Minnesota physicians practice here in the Twin Cities. And then we among the 10, we also have two rural hospitals in northern Minnesota. We've got 60 clinics, senior living organization that operates a large number of senior living facilities, and we've got a large specialty pharmacy business. You know, when you. When you think about our biggest win over the last year, I think it culminated probably over the last nine months. We reported in 2024 our first operating profit in six years. And that was a roughly $600 million turnaround from our low point two years prior to that. And that 600 million includes the impact of inflation. And it was really broad based. It was across almost all of our business units. And it happened while we were also improving our scores on quality, patient experience, employee engagement, and really having a great impact on our communities. And that was recognized just last week in Fairview receiving the Foster McGaugh Award from the AHA. So really hitting on all cylinders, both operationally patient experience, patient outcomes, and the impact on the community. So it's been a terrific year for Fairview.

[A]

That's amazing to hear. And you know, how impressive that you're able to not only experience that financial success and really turn things around operationally, but then looking at the clinical side as well and employee engagement and everything else, you know, seeing such success, organization wide, I know is not easily said or done, to be honest with you. And so from your perspective, what do you think really makes Fairview special? How have you been able to have such success across the board, whether it's cultural or, you know, anything else that really makes a difference?

[B]

Yeah, I think we've really focused on building a culture of resiliency. You know, we've built the engines within organizationally, we have a transformation office that's incredibly effective, and we know how to identify those key levers, those key projects that have the biggest impact, whether that be on patients or the community or our financials. And so we feel great about our ability to adjust and to react to whatever might come our way and respond.

[A]

That's great to hear and truly, truly special. Now, what are some of the top two to three issues you're focused on right now? What's top of mind for you?

[B]

You know, it's really continuing our turnaround and continuing to build a great workforce that can respond to all the changes that are coming our way. It looks like, you know, maintaining our operational discipline and workforce discipline. We've seen our nursing vacancies go down 83%, turnovers down 36%. And those key things are what really help drive us forward. And then it's about really introducing programs that, you know, keep those precious hospital beds available for the folks that need it most. That could be things like hospital at home, our empath unit, which we're very proud of, which is a specialty, almost ed, for folks in a mental health crisis, so that they don't have to go to a typical ed. They can go to a much more conducive setting when they're in that situation, get the kind of care that they need and keep them out of the ED and keep them out of inpatient admissions and have a better outcome for them throughout.

[A]

That's fascinating to hear about. And, you know, again, really impressive statistics when you think about the workforce growth and, you know, nurse vacancies being so low and then turnovers as well. I mean, I think it's just so fascinating to have that on your books and from your seat as a cfo. You know, what does that mean for you to have that kind of stability in the workforce? And, you know, how do you see that continuing to grow and evolve over the next few years?

[B]

You know, it's. It's everything, right? Because if you. If you've got a stable workforce, you're much less reliant on transitionary workforce or travelers and so forth. And so the cost is lower, your patients are having a more consistent experience, and we're delivering better outcomes. And so that's critical to us. And it. And it doesn't happen by accident. I mean, the way the folks have really, our staff is focused on identifying those key areas where we need to recruit, shortening the time for onboarding Making sure we're plugging into the things that matter to our employees to improve retention have all contributed to the financial turnaround.

[A]

That's great to hear. And, you know, again, just a lot of energy around the right things, it seems, can make a big difference. Looking ahead, what are some of the big opportunities for Fairview's growth over the next few years? How are you thinking about that and planning for the future?

[B]

Yeah, we have. You know, just following up on my earlier comments, big focus on those things that create access for patients. We talked about the hospital beds, identifying those areas where we can have more. More of those beds available when they're needed for the people with the biggest needs. It also extends to access to specialty clinics, our primary care clinics and so forth, and making sure that the wait times to get into those are as short as they can be. And that experience is terrific for folks. In addition to that, we have a big focus on our specialty pharmacy business. Fairview does this probably as well as anybody in the nonprofit space. And it's really through increasing the capture that we have of the prescriptions written in our clinics. We've got a great team that follows up with those patients. And what we see is better outcomes for patients at a lower cost because we've got pharmacists talking to those folks, making sure that we've got the right medicine, and it's resulting in lower costs and it's been recognized by payers as such as.

[A]

Well, got it. That makes a big difference. And I know looking at how we've started to focus a bit more on the pharmacy department and services at Beckers too, it's just been fascinating to see how much they're able to influence the success not only of patient care, but looking at the financial metrics and some of the things that need to happen, especially in a transformational phase, having strong pharmacy leaders seems like it can make a big difference.

[B]

Yeah, just really integrating that into the whole care delivery that we serve our patients with has had a tremendous impact. And so we've created a separate business unit. We call it Fairview Pharmacy Solutions, where we're beginning to help other systems do the same thing. And it's being very, very well received by those systems.

[A]

That's fascinating to hear and something I'm sure we love to dig into deeper for future interviews. Now, before we wrap up, I'm curious, what will it take to lead a thriving organization over the next five years, especially given some of the things we've talked about today. Continued transformation and just innovation, as it seems to be so important within any healthcare system.

[B]

You know, it really starts with being mission based and having that mission first mindset. And at Fairview, that is to be the most human centered health system. And by putting our patients at the forefront of everything we do, it drives us to greater levels of innovation, greater levels of service, and greater levels of performance. We talk at Fairview about how necessary that our 34,000 employees are all leaders and in doing what it takes to be able to serve those patients. And through all of that, we've created a culture of resilience where employees are empowered to do what's needed to drive us forward in service of those patients.

[A]

That's amazing to hear. Joe. Thank you so much for your time today on the podcast. I really appreciate the opportunity to speak with you and I look forward to connecting with you in the future as well. And I know meeting you in person at the CEO CFO Roundtable, it's truly going to be such an amazing time to connect and learn from one another. And so I'm looking forward to continuing the conversation there.

[B]

Likewise, it's been a pleasure today and looking forward to seeing everybody in November.