John Mallia, Interim Chief Financial Officer at Methodist Le Bonheur Healthcare

Summary

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Becker’s Healthcare Podcast: John Mallia, Interim CFO at Methodist Le Bonheur Healthcare

Date: February 6, 2026
Host: Will Riley (Becker's Healthcare / R1)
Guest: John Mallia, Interim Chief Financial Officer, Methodist Le Bonheur Healthcare
Duration (Content): ~13 minutes

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Episode Overview

This episode features John Mallia, the Interim CFO at Methodist Le Bonheur Healthcare, discussing the evolving financial landscape of healthcare, with a particular focus on revenue cycle transformation, payer dynamics, technology adoption (especially AI and automation), and the role of organizational governance in navigating change. Mallia shares on-the-ground insights from recent major system implementations at Methodist Le Bonheur and reflects on larger industry challenges and opportunities.

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Key Discussion Points and Insights

1. Introduction & Organizational Background

[00:47–02:08]

• John Mallia introduces himself and his role as Interim CFO, noting his interim experience at multiple health systems.
• Methodist Le Bonheur Healthcare:
  • Six hospitals in Memphis area, including Le Bonheur Children’s Hospital (academic center).
  • Recently implemented major systems: EPIC (EHR) in October, Workday in July.
  • Partnership with Ensemble for end-to-end revenue cycle outsourcing.

Quote:
“My Midwest accent is kind of new there. Not everyone talks the way I do, but it’s actually really cool. They’re a very welcoming community, and it’s just been fantastic to get started there.” (John Mallia, 01:14)

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2. Revenue Cycle and Payer Dynamics

[02:08–03:28]

• Increasing complexity in commercial payer and Medicare Advantage dynamics; ~50% penetration in Methodist’s population.
• Noted rise in friction: more prior authorizations, denials, and delays in patient access.
• Organization is actively working with payers and legislators to improve processes.

Quote:
“It is becoming more difficult, a lot more friction, particularly on the managed Medicare side, the Medicare Advantage side... it’s slowing up access. So it’s something that we’re attempting to address... with our payer partners and also working with some legislative folks...” (John Mallia, 02:45)

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3. Technology and the Shift Toward Automation

[03:28–05:32]

• Large-scale tech investments (EPIC, Ensemble) are key to tackling inefficiencies and leveraging automation.
• Healthcare revenue cycle is shifting from a labor/cost-intensive process to one focused on automation and intelligent workflows, but adoption lags behind other industries.
• Change management is a cornerstone: workforce transition from manual to automated processes is gradual but necessary.

Quote:
“I think the workforce of the future is going to be one that is more of a learning workforce as opposed to a knowing workforce, but making that transition sometimes takes a little bit of time.” (John Mallia, 05:23)

Memorable Moment:
Mallia describes how post-EPIC implementation is as much about “cleaning up” legacy workflows and behaviors as it is about the new technology itself.

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4. Managing Change and Training Staff

[05:32–06:30]

• Emphasizes focused, incremental change management.
• Staff often revert to previous (paper/manual) workflows even when automation is available.
• Importance of ongoing education and addressing issues one at a time.

Quote:
“There’s a bunch of other things that are automated, but folks still kind of migrate towards their previous workflows, perhaps even using paper when everything is online. So working through that kind of one issue at a time is the part that we’re going through right now...” (John Mallia, 06:18)

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5. Real-time Consumer Experiences & AI Potential

[06:30–08:29]

• Modern patients expect the same real-time, digital-first experiences as banking/retail.
• Healthcare is behind on this front but tools like MyChart are helping shift expectations.
• AI seen as a major opportunity area; larger, better-capitalized systems may outpace others, but strategic partnerships can help smaller organizations catch up.

Quote:
“We’re behind. I mean, I think patients today are expecting that out of their healthcare providers. They get it in banking, they get it in retail... they come to their doctors and hospitals, and they get almost nothing like it.” (John Mallia, 07:04)

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6. AI Governance, Data & Stakeholder Engagement

[08:29–10:19]

• Critical to establish governance frameworks before AI implementation—regulations and fragmented systems are barriers to adoption.
• Governance boards should include leaders responsible for patient experience, informatics, finance, and nursing.
• Thoughtful, intentional planning is required to balance innovation with privacy and mission focus.

Quote:
“I think it’s very important to start with governance first. And that’s part of the reason I think healthcare has lagged is just because of the regulations around our industry, appropriately so in terms of privacy—but also because we still have a lot of systems that run on multiple EMRs and interfaces.” (John Mallia, 08:44)

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7. Advice for AI Initiatives in Healthcare

[10:19–11:37]

• Avoid a “shotgun” approach; select focused, high-impact AI projects.
• Find credible partners—smaller organizations may lack resources for significant R&D.
• Communicate clearly with staff: AI should reduce friction, not humanity.
• Invest in people, not just technology.

Quote:
“If [AI is] used best, reduces friction, not humanity. And I think that’s really the message is how that gets communicated to our associates, our employees, and our key stakeholders.” (John Mallia, 11:31)

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8. Near-Term Threats & Long-Term Concerns

[11:37–12:43]

• Imminent worry: lapsing of subsidies could increase self-pay patient volume as early as January, requiring rapid financial engagement.
• Long-term: loss of Medicaid supplemental payments threatens financial stability for safety net hospitals; requires scenario-based planning.

Quote:
“I think the one that’s keeping us up most in the near term is the lapsing of the subsidies and how that’s going to impact, perhaps increase our self pay patients and the opportunities and need we have to engage them on the front end... For safety net hospitals, you know, the Medicaid reimbursement through directed payments going away... Now we have to scenario plan around the fact that those might not be there.” (John Mallia, 11:47 & 12:23)

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Notable Quotes & Memorable Moments

• “The workforce of the future is going to be one that is more of a learning workforce as opposed to a knowing workforce.” (05:23)
• “AI, if it’s used best, reduces friction, not humanity.” (11:31)
• On lagging digital experience: “They get it in banking, they get it in retail... they come to their health system, and they get almost nothing like it.” (07:06)
• Advice to peers about AI: Only about 5% of AI ventures reach fruition—focus efforts and avoid chasing every trend. (10:57)

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Important Timestamps

• Intro & John’s background: 00:47–02:08
• Payer dynamics & managed Medicare challenges: 02:08–03:28
• Technology/automation investment & change management: 03:28–06:30
• Real-time digital expectations & AI opportunity: 06:30–08:29
• AI governance, stakeholder roles: 08:29–10:19
• Advice for launching AI programs: 10:19–11:37
• Subsidy/Medicaid threats, strategic planning: 11:37–12:43

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Tone & Takeaways

John Mallia’s pragmatic yet optimistic approach underscores the pressing need for deliberate digital transformation in healthcare. His focus on governance before innovation, the value of thoughtful change management, and humanity-centered approaches to adopting AI provide actionable insights for health system leaders. The candid acknowledgment of barriers—internal, regulatory, and external—brings both realism and a call to action for pacing healthcare’s strategic evolution.

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For listeners seeking a concise yet comprehensive perspective on financial leadership and technology transformation in health systems, this episode delivers both practical advice and industry context.

Transcript

[A]

R1 is the leader in healthcare revenue management, helping providers achieve new levels of performance through smart orchestration. With more than 20 years of experience, R1 partners with 1,000 providers, including 95 of the top 100 US health systems, and handles over 270 million payer transactions annually. If you want to learn more about how you can transform your revenue cycle operations, Visit us at www. R1RCM.

[B]

Hello and welcome to the Becker Healthcare podcast. My name is Will Riley from R1. With me today is John Mallia, Interim Chief Financial officer at Methodist Le Bonner Healthcare. Welcome to the podcast, John.

[C]

Thank you. Will appreciate you having me.

[B]

Absolutely. To start us off, tell us a little bit about you, your role and some of the key priorities that you're working on.

[C]

Absolutely. So I'm, as you mentioned, the interim CFO at Methodist Le Bonner Healthcare. I've actually been there for about a little over three months now. I do interim work for a living. Before this, I was actually in New York for about six years at two separate systems doing similar work. But at Methodist, we have six hospitals in and around the Memphis area. We have Le Bonner Children's Hospital, which is a world class children's hospital, of course, and an academic medical center as long as, as well as a bunch of other fantastic FAC facilities in and around the Memphis area. So my Midwest accent is kind of new there. Not everyone talks the way I do, but it's actually really cool. I mean, they're a very welcoming community and, and it's just been fantastic to get started there. We have a lot going for us. We have a lot of opportunities ahead of us. We just went live with EPIC in October of last year, went live with Workday in July of last year. So we're getting through all of that kind of post EPIC cleanup, if you. And we just went live with our new partners ensemble for an end to end outsourcing of our revenue cycle. So looking forward to leveraging that for a lot of great things going forward.

[B]

Excellent, excellent. That's great background. Let's talk a bit about revenue cycle and payer dynamics. Obviously we've got a really dynamic legislative environment right now and lots of. There's been a lot of, let's say for both foreboding at this conference about the big beautiful bill and some of the implications on that in terms of reimbursement.

[C]

Right.

[B]

And payer provider dynamics have been tricky for, for a long time as well. Commercial payer, I mean.

[C]

Right.

[B]

So, you know, how are you adapting your financial strategies for that emerging reality?

[C]

So you know, on the commercial side, it is becoming more difficult, a lot more friction, particularly on the managed Medicare side, the Medicare Advantage side, you know, we're about 50% penetration in terms of our managed Medicare and it's challenging. A lot more prior loss, a lot more denials, a lot more friction that we're having and it's slowing up access. So it's something that we're attempting to address. We're attempting to face it head on with our payer partners and also working with some legislative folks to figure out if there's a way forward in that regard. So, you know, there's opportunities, I think we have a good relationship with our payer community, but there's some opportunities, I think, to do some things in a better way.

[B]

Do you think that like, technology can play a role here and like how can that.

[C]

Absolutely. And again, going back to our relationship with Ensemble, you know, they're helping us kind of take things to the next level. We made a big step with implementing the EPIC system and a lot of the infrastructure that was new to us from our previous systems. Obviously ENSEMBLE has a lot of experience. They've implemented and invested a lot of R and D in, in new technologies and AI that probably would have taken us much longer to implement. So we're looking forward to being able to, to use that to, to move things forward. From a technology standpoint, revenue cycle does.

[B]

Feel like a place where, you know, it's been a very labor. Labor centric paradigm. Right. And it does feel like it can shift to more or less a automated automation first paradigm.

[C]

Absolutely.

[B]

Do you agree with that? And, and like, as you, as you think about that, what are some of the hurdles and. Yep. That you've got to get over.

[C]

Yeah. You know, anytime you go through an EPIC transition and this will be my second one, there's a lot of change management that has to take place and not all of it can get done. Sometimes you kind of implement over some bad workflows and after the, the cleanup and the, in the post implementation cycle, you have to clean a lot of that up. A lot of the change management has to a lot of employees and our staff and really just revenue cycles across the country have been trained in old systems, perhaps spending a lot of time taking information out of one system, moving it into another, just human interface, if you will. I think we're at a stage where we can move past that. I think the workforce of the future is going to be one that is more of a learning workforce as opposed to a knowing workforce, but making that Transition sometimes takes a little bit of time, and we're going through that journey right now.

[B]

I mean, how do you do it? How do you make that transition? I mean, you've got folks that have been in roles for a long time, those roles are changing. How do you navigate it?

[C]

Yep, it doesn't happen overnight. And a lot of it has to be really focused change management in particular areas. Just for example, the prompts on the front end that EPIC provides in terms of picking insurance, a lot of that took a lot of manual effort before. A lot of that is automated now, but folks don't necessarily know how to use those to pick through that. So, you know, that's just one example. There's a bunch of other things that are automated, but folks still kind of migrate towards their previous workflows, perhaps even using paper when everything is online. So working through that kind of one issue at a time is, is the, the, the part that we're going through right now?

[B]

Yeah. Okay. Okay. You, you're talking about things there that make so revenue and financial processes. Really slow technology has the potential probably, we think, to make it all happen a lot quicker. Right. You know, as consumers we expect real time everything.

[C]

Right.

[B]

Real time transactions. Our exposure to AI is making us expect things quicker and in a more synthesized form. Like how do you think healthcare can rise to meet some of that demand and potential for real time experiences?

[C]

We're behind. I mean, I think patients today are expecting that out of their healthcare providers. They get it in banking, they get it in retail, and then they come to their, their health system, their doctors and their, and their hospitals, and they get almost nothing like it. Now my, my chart is moving the dial for us in a real way. You know, we have to optimize it. We have to make sure that our patients are actually signing up for it, which doesn't happen automatically, but I think there's things that we can do to, to move that down the line. But the healthcare as an industry, I think is definitely behind other industries and, and consumers recognize that.

[B]

Yeah, yeah. Where are some of the opportunities though, do you think, for healthcare to speed up and catch up?

[C]

Yeah, and again, I think that this is where this AI revolution is going to come into play. And again, I think we are behind as an industry, a lot of other industries that are moving forward with it. So that's a real opportunity for us. I mean, I think those that are better capitalized, the bigger health systems, that have more distributed systems and more investments in R D and some of those areas are going to Leap ahead. Yeah. Or naturally they're going to be in a better position to do that. But I still think that there's opportunities for some of the smaller standalone systems to partner with other organizations that have already made that investments. Like we're partnering with Ensemble to make sure that we're capturing as much as we can.

[B]

Yeah. Okay. And what about governance? When you think about AI initiatives and programs, there's a lot of concerns around data usage, access to data, monetization of data, for example, how you think about those.

[C]

Yeah. And I think it's very important to start with governance first. And that's part of the reason I think healthcare has lagged is just because of the regulations around our industry, appropriately so in terms of privacy, but also because of we still have a lot of systems that run on multiple EMRs and multiple interfaces, and it's difficult to cut through all of that.

[B]

Yeah.

[C]

So that's part of the reason why we're, I think, struggling as an industry, having that governance model set up, which means having thoughtful, intentional folks at the table to understand exactly what that thought process is going to be for each organization and how they're going to implement it. And just really the mission centric focus around how the adoption is going to be for each organization is an important step.

[B]

Who are some of the key stakeholders when you're looking at that and trying to decide what to do and what to prioritize?

[C]

Yeah, definitely the folks that are responsible for patient experience, obviously your CMIO or your equivalent is going to be an important piece of that. Your chief Medical Information Officer, I think finance has a place for that, a seat at the table, because revenue cycle is such an important aspect of that and how AI is going to be adopted going forward. So in nursing, you know, nursing touches the patient more than anyone in the, in the system. So really it's going to be very much everyone at the, at the executive level that has to have a voice in how that gets set up.

[B]

Excellent. What are some things that you would recommend to, you know, some of your peers who are starting AI programs?

[C]

Well, you mentioned one of them, and I think that might be the most important piece is that you build that governance framework. And also, you know, it's difficult to dive into everything AI. I mean, I think there's a tendency to, you know, want to invest in everything and take a shotgun approach. I heard one quote here at the conference that says that every venture, AI venture, only about 5% ever, you know, reach any level of fruition. So basically, 1 in 20 is all that's going to be done. So those that, you know, organizations, smaller organizations aren't going to be able to invest in that kind of R and D. So every shiny new thing is probably not going to be something that's going to be appropriate for, for everybody. That's why it's really critically important to find the right partners as you're going along that journey after you've set up the governance structure to identify exactly where you want it to deploy that. And then last but not least, I think investing in people, you know, AI, if it's used best, reduces friction, not humanity. And I think that's really the message is how that gets communicated to our associates, our employees and our key stakeholders.

[B]

Fantastic. John, it's been great hearing from you. Are there any other parting thoughts or any, any other things?

[C]

No, just, I mean real quickly you had mentioned the obba and, and you know that, that there's always the threats that are out there. Some of them are immediate, some of them are longer term. I think the one that's keeping us up most in the near term is the lapsing of the subsidies and how that's going to impact, perhaps increase our self pay patients and the opportunities and need that we have to engage them on the front end pretty short order, perhaps as soon as before January 1st. So that's the imminent threat and then the longer term issue associated with for safety net hospitals, you know, the Medicaid reimbursement through directed payments going away. So those are things that we're concerned about. You know, we have to integrate it into our planning process. For years we integrated those payments into our strategic planning process. Now we have to scenario plan around the fact that those might not be there. So that's what we're spending a lot of time doing in the planning process.

[B]

And hopefully some of the innovations we've been talking about can help you find some efficiencies along the way to adjust things on the other, on the other side of the scales.

[C]

Absolutely.

[B]

Yeah. Okay. John, thank you for spending time with us. It's been lovely talking to you. Appreciate it.

[C]

Pleasure.

[B]

Thank you. Thanks.