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Becker’s Healthcare Podcast
Sham Firdausi, Deputy Chief Financial Officer of the County of Santa Clara Health System
00:24:01
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- [00:01]
A
This is Alan Condon, back with another episode of the Becker's Healthcare Podcast. And today I'm thrilled to be welcomed back to the podcast. Shyam Fardazi, Deputy CFO of the county of Santa Clara Health System. Sham. Always a pleasure to have you on the Beckers podcast with us. For those who are listeners who mightn't be as familiar with you, can you take a moment to introduce yourself, just to share a little bit more about your role and your background in healthcare?
- [00:28]
B
Thank you for having me. It's a pleasure to be here as always. My name is Sean Ferdasi. I'm the deputy CFO of the county Santa Clara Health System. We're almost about four and a half billion, $5 billion health system with four hospitals and network clinics running through every corner of Santa Clara county, right through the heart of Silicon Valley. We are safety net for one of the most innovative, diverse communities anywhere in the country. My role here, specifically, I oversee finance, revenue cycle, supply chain, and just about find myself woven into almost everywhere else across in the organization, from service line strategy to operational strengthening to wherever work needs to get done. I get to do that alongside with some of the most exceptional people I've ever worked with. County leaders, system leaders, clinicians, frontline staff who show up every single day with everything they've got for the people who need them the most. My little bit of my background, I've had the privilege of leading across some of the largest organizations in healthcare pairs, Fortune 10 companies, large private system. Seeing this industry from just about every angle there is, that's not where it all started. I'll share a little bit personal why, you know, this work matters to me the most. You know, it started with my mother. Came here with nothing from Pakistan, my sister and I, a few dollars in our pocket, pocket, really chasing that American dream in the greatest country in the world. You know, that's, that's, you know, that's what immigrants come here for. And she did it, you know, she taught us from a very young age. You see something broken, you don't walk past it, you fix it for me. As I see our health care system and I, you know, complete honesty, I saw that as one of the first things that were broken. So got up, rolled up my sleeve and started working through it. And I saw it firsthand, you know, once my mom passed away, I was still a teenager. Just got to see how broken the system really was. And that never left me. Joined the military, Marine Corps to Army 101st Airborne, deployed Iraq. And you know, people really ask Me, you know, why I joined. I mean for me, like I said, greatest country in the world, wanted to give back when I served back and really think through it all. And I built my career all through the came out of the military and just built my career in the landscape of health care. Continued on with the mission to serve the people and really fix it all for us. And yeah, that's kind of a little bit on my background and it was a lot but that really kind of wanted to share that with the people up front so they get to understand where my answers come from. As we really talk about the safety net health systems of public net public hospitals that are the backbone of the American healthcare.
- [03:08]
A
Yeah, I mean, no, fascinating. I think really, really appreciate that perspective in terms of your diverse healthcare background. Of course your military background. Had the pleasure of speaking with you a couple of times, meeting you as well at one of our Beckers meetings and excited to kind of dive into our conversation today, focusing a little bit on that and hopefully driving change in the healthcare landscape to your point. So sham, I know you talked a little bit about it in your intro there. I believe you made that deliberate choice in your early 30s to leave the private sector for public health. Most people, I think it's fair to say with your background move in the opposite direction. So what was that moment or that inflection point for you that really made you to make that choice to go the other way?
- [03:53]
B
Great question. And it's funny because a lot of people ask me that, you know, they, they ask me like hey, you know, but you know, coming from someone from complete private sector insurance companies, you know, being it, you know, having been to, you know, Brown and Yale, you know, most people with a background like completely choose to go in the opposite direction. You know, that's where the money is reality, that's where the glam is. You know, for me it wasn't like a one time epiphany as you know, kind of. That's why I wanted to kick it off with my background. It was very personal and for me it was more like a slow burn that I just couldn't ignore. I said earlier on spent years inside some of the largest pairs and a private health system organizations in the country and I was generally good at it. I understood the business, understood how the math worked. But the longer I sat inside those organizations, the more I kept seeing the same thing over and over again. You optimize a network, you tighten a contract, you improve margins and somewhere in that math, you know, you have real people who do not have the right zip code or right insurance card or the right documentation. And I came from a community that know, that knows what it feels like to be on that, the other side of that map. You know, I watched my mother navigate the system, felt those gaps firsthand and sitting inside organization, generating billions while those same gaps persisted. So you know, it started to feel like something I just could not, you know, just make peace with. So I kept telling myself over time, hey, stay in the private sector, learn anything and everything. You can take that knowledge and then go do something with it. And that's what I did. You know, I stopped waiting for the right moment and I made the move. You know, at 33, left behind a title salary trajectory that most people in my fe, you know, field would have been very comfortable staying on. And I came to the public health system, like I said, one of the largest in the country. And honestly the day I walked in, I saw the breadth of what we serve. You know, the, the, the people that we serve, you know, where we serve, what we do, every zip code, every background, every language you can imag know, we serve them regardless of who they are and how they got here. And I knew at the time I was exactly where I was supposed to be. And it's just an honor to be here, an honor to serve this community.
- [06:06]
A
Yeah, I mean fascinating kind of background, obviously, very, very personal decision for you. I'm curious if you could enlighten me. What was for someone who spent so, so much time in the, in the private sector at some big organization, the payer side healthcare finance, when you did make that switch at 33 to the public sector, what was kind of the biggest shock, the biggest eye opening for you having spent so much of your career up until that point in some big private health care organization?
- [06:37]
B
I think for me the biggest shock and eye opener really was around, you know, how people think and perceive the public health, safety net health systems. And I think for, you know, that's, that's one of the things and even someone that had never again I've been a patient in the safety net health system. I mean like I said, they, you know, were my lifeline back in the day. But I also thought of them as just that, that hey, you go there because you know, they don't, they provide these services and whatnot. But when I came and started seeing them from the inside, I've been here almost seven, eight months now. And just in the county of Santa Clara health system, I will say this. We have some of the best people that work here. And I don't say that just best because people are here for the mission, but also the best credentials you can imagine. Every single provider that I talk to has had that Ivy League education health systems like yearn for. Right. I mean we have providers that went to Stanford. We actually just started running the Stanford residency program. And just kind of a little bit of background, you know, here it was just, it was, to me it was just kind of fascinating that part of it, from the providers to the service lines, from the care that we provide, you know, I never thought of it that way, that you know, we could be at the same level if not, you know, as private health system, someone from the outside. Now I see it and I can tell you that the experience here, the patient care, the safety, the services that we provide to anybody and everybody that's in our community, we are doing a lot better than some of the other health systems that I've been worked with in the past, both private, nonprofit and that was an eye opener to me because I never saw it that way. And I think that's what people perceive when they hear the word safety net or public hospital or county owned. And I think that's the mentality I want to continue to change and share with the world what kind of services that we offer and what we bring to the table when it comes to looking at other health systems versus county owned or safety net.
- [08:32]
A
So take me into that. County owned safety net systems. I think, correct me if I'm wrong, Shyam, I believe public health systems and safety net hospitals currently make up around about 5% of U.S. hospitals but provide more than 25% of the country's charity care. We also know that uninsured population is on the rise. This is a big, big challenge across the board for hospitals and health systems. I guess the million dollar question here is why do you think these institutions, public health systems, safety and hospitals are almost entirely absent from that innovation conversation. And what does the field lose really because of that gap?
- [09:11]
B
Yeah, I mean, I'll tell you exactly why and you know, not a complicated answer. I think really it's around, nobody's telling their story, you know, that's exactly what it is. I mean when you think about the institutions that dominate the innovation conversations in healthcare, the large academic medical center, the well capitalized system, the health tech darlings, they all have one thing in common. They have communication teams, they have marketing budgets, they have board members who sit on venture capital firms and they show up at every conference.
- [09:39]
A
Right.
- [09:39]
B
Safety net hospitals are too busy taking care of everybody who walks through the door to be able to do any of that. So that narrative gets built around them by default that it's a survival narrative. These are struggling institutions, these are the hospitals at last resolve. And that story, while partially true in some places, is deeply incomplete because here's what's not going to make the headlines. The systems that hold majority of Level 1 trauma centers in this country, they train a disproportionate share of the physician workforce. I mean they've been serving the hardest patients in the hardest circumstances for decades and doing it with a fraction of the resources the rest of the industry takes for granted. The innovation happening inside safety net health system does not. We're not out here getting a TED talk or venture capital term sheets. We do it because it has to get done. We need to be able to take care of our people. That's what the field loses because that gap is enormous. When you design solutions only for a well resourced system with straightforward patient, you're designing a version of American healthcare that doesn't reflect most of America. You know, that stress test to me is missing. The insight comes from building something that works from, you know, the single mothers to the unhoused veterans, the patients who are speaking seven different languages, one clinic. That insight never makes it in the room where decisions get made. Some of the most innovative work happening in health care right now is actually being done by leaders who nobody has heard of inside buildings where the donor wing, if there is even one, is the least interesting thing about what happens inside them. Serving patients that no other system was fighting to keep. And I think that's exactly why I'm here. I want to tell that story. I want people to understand the work that goes behind it. And the other interesting point that I'll share is I believe in California alone, public health safety NET hospitals are 6% of the total hospitals. Yet they train over almost 40 to 50, 50% of the providers. So they create the foundation for some of the best providers in the country. When we have some of the best friend in the country that go out and do phenomenal things. It all starts right here in the safety net public health hospital system. So thought I'd share that. And yeah, that's kind of what I'm here. I want to continue sharing that. I want to continue to highlight the innovative work that the county, the health system here is doing as well as other health system safety nets across the country. They just need that voice and that platform.
- [12:09]
A
Yeah, no, absolutely. I think on that, I guess what do Leaders like yourself and other systems do. Obviously podcasts like this with Becker's hopefully in some small way shape or form help tell this story. But curious what other avenues can maybe prove effective and help in getting the word out, telling your story, whether that's what lawmakers with the public or the wider community. Is there anything else you're doing at the county of Santa Clara Health System in that regard?
- [12:33]
B
Yes, you know, the county is very vocal. You'll, you know, the county does do a lot of, you know, news and press conferences. Our the county executive, Jane Williams, fantastic leader, by the way, and Greta Hansen, she's the CEO. I mean, great leadership all around at the county level. They recently just did a, you know, press conference announcing the budget. So, yeah, they, I mean, they're very vocal. The board of supervisors here are very and you know, very, very really involved in the mission as well. And they're very vocal. You know, they've been at the forefront of it. But a lot of the, you know, the headlines, the news that, you know, they're make, they're very local, obviously, because, you know, we're the county of Santa Clara, we are local in California. But at the same time, the work that this house system does and other safety and health, they deserve that national voice. So, you know, we do our best to do what we can. Obviously, you know, with the budget restraints and just being a safety and health system, we do not have those, you know, large marketing budgets. So we do our best to get our voices out there. I know myself some other safety net. You know, leaders across the country have been very vocal, especially recently, to try to get, you know, what's happening in our systems and what the pressures we face, challenges we face to get more of a message out there. So, yeah, I mean, we're all doing our best, but, you know, that's kind of we use with the resources that we have at this point because the main focus is always just going to be wherever there's dollars. Let's invest them in patient care, let's get them where they need to be rather than trying to, you know, get them, you know, try to beef up our marketing budget, I guess.
- [14:00]
A
Yeah, no, no, absolutely. I think these are the type of story that we really love to kind of shine a light on and spotlight back as well. Some of the fantastic work like leaders like you are doing. So getting back on track here and just wanted to shift gears back into no secret to you shams any of our listeners in terms of the Medicaid pressures, the reimbursement Pressures that many systems are facing, particularly on the public safety net, hospital health system side of things. Medicaid, no doubt the financial backbone of most public health systems. And it's under a ton of pressure right now, arguably more so than it has been in decades. Can you kind of walk us through how you're thinking about financial sustainability versus innovation when the reimbursement floor appears to be constantly shifting underneath you?
- [14:46]
B
Yes. I, you know, I want to say something that, you know, most people in my seat will not say out loud on a podcast, but I think, you know, people need to hear this. There is no playbook, right? Let's be real. There's no playbook at this moment. Anyone that is going to sit here and tell you they have it figured out, you know, it's not either being straight or they're just not paying close attention. That's just what the reality of where we're at, what we're actually dealing with. Just in the county of Santa Clara, for example, you know, one in four residents in the Santa Clara county relies on Medi Cal for their health coverage. Medicaid is our single source of federal revenue. So single source of revenue, more than 2.3 billion your current fiscal year, HR1 was signed into law, you know, back in July 4th. It's going to put approximately almost a trillion dollars for Medicaid nationally over the next decade. And for us that translates to almost a billion dollars in revenue loss for the next few years. Now, you know, our CEO here that the health system, you know, Paul, has made it very clear in public that we have a 4 billion dollar budget and we're looking to lose about a billion dollars a year. You know, the math doesn't lie and does not leave a lot of room for comfortable thinking. We have a system that, you know, 5,200 trauma cases, I think we did in 2024, just in our, one of the hospitals, Valley Medical, like I mentioned, we trained one in four physicians in Santa Clara county and we have, we're going to keep our doors open regardless. So for me, when I think about, you know, what we're looking at and what we need to do, I mean for us it's a three pronged approach. You know, it's pretty straightforward. We're going to look at tightening our, you know, just looking at our expense management. How do we look at that better? You know, as I work with supply chain, as I look at our contracting vendors, my goal is to really think of them as long term partners and you know, bring, bring them to the table. Have conversation with them, let's be honest with them. Hey, this is where we're at. This is what we need. Let's work together, let's see where things go. Because we need to start looking at, you know, proper expense management. The second part is, you know, obviously the county is working very closely with the state to see if, you know, the state of California will jump in and help out. And that's what we need at this point. You know, the state also needs to realize that, you know, we're a very large county, we have a big population, and we need the funding that to continue to support our patient population. Either way, we're going to do it, but they need to make sure that, you know, we have the proper resources. The third part is really revenue strategies. And that's the part that kind of gets me a little bit excited. I mean, I'm out here really thinking through with the team what type of strategies we're going to play to increase revenue, think through our rates, how we look at it, versus some of the other health systems nearby. Because things are different for us. We need to really think through that and we need to build that financial resilience before the storm comes knocking on our door. I mean, it's 2028 is, you know, as we move towards it, it's like a ticking time bomb. That means, you know, we have to be relentless about how we do revenue cycle performance, capturing every dollar we've earned, reducing denials, eliminating ways, and investing in technology that pays for itself. You know, for us, that's, that's the type of innovation that we're working with and that's the mentality I'm trying to bring here at the county and work very closely with them. So those are kind of some of the things that we're working through. Again, that's, I wouldn't say that that's the ultimate playbook. Like I said, there is isn't one specific thing that we're looking at. The goal is try to, you know, approach it in a more strategic fashion and try to knock on every opportunity that we can and try to leverage it.
- [18:16]
A
Yeah, no, I appreciate the level of specificity and, you know, not beating around the bush there in terms of the, the near term challenges that a lot of safety net systems like yourself face. And we're looking ahead to 27, 2028. So just to kind of. One quick follow up, Shyam, if you don't mind, before I jump to our last question, in terms of that three pronged approach that you've mentioned. Cost management, county, kind of working with the state of California revenue strategies, which I believe you're. A couple of areas you're particularly excited about. Could you share maybe one or two kind of specifics in terms of revenue strategies, whether that's in the revenue cycle, kind of investing in technology, automation. I'd love to hear maybe just one bit deeper or one kind of specific thing that might be working for you in that regard.
- [18:59]
B
Yes, I think it's really about automation and thinking through what's out there. You know, AI has been a big hot topic all across the healthcare industry and that, you know, other than a million other things I keep myself busy with. I, you know, have an engineering degree, so I've been big advocate of technology and AI across the healthcare landscape where it matters most and where it still protects patient safety. So I've been very vocal with that for us. I am starting to explore and really think through in the revenue cycle world, where can AI fit in? I've seen a lot of good potential in the market, especially in the areas such as denial management, revenue capture, charge capture. So those are some of the areas my big focus has really been on some strategies just in house, manually that we're working while we start exploring different vendors, going through, you know, the RFP process, RFI process through the county. Working with the county procurement team is really how we can just starting to build the foundation for it. So work. My revenue cycle team has been fantastic. We run our revenue cycle in house, working through different denial management strategies. I mean, denials are spiking through the roof. Like I said, payers don't want to play fair either. It's been like, you know, drinking from a fire hose at this point. But yeah, I mean, some of the strategies on the revenue area has really been on revenue capture, charge capture, thinking through denial management strategies and working through those while exploring and possibly in the near future bringing some AI technology in house and starting to leverage that in our revenue cycle management.
- [20:33]
A
Absolutely. I love some of the specifics in terms of revenue cycle there. Shyam, last question before I let you go. I mean, fascinating conversation podcast so far. There's certainly a lot of challenges, of course, but certainly maybe some room for opportunity. As a leader who wants to bring more of these voices together, public health system leaders like yourself, who are doing some serious innovation work, but perhaps are invisible in that national conversation. If you could put three or four of those leaders in a room and have an honest conversation about the state of public health infrastructure in this country, what's the one question you'd want answered?
- [21:11]
B
Yeah, this is, this is a great question. You know, I going to have a very different answer than what people expect. You know, obviously most people are going to say, you know, say something, you know, Medicaid cuts, workforce shortage, technology. Not to me, that's not what matters. The conversations I want to have really is are we truly building the next generation of leaders who are willing to do this type of work? I mean, not just capable, but willing. You know, this type of work requires a lot of, a lot of effort, a lot of manpower, just a lot of will to be able to do this type of work. So are we building that next generation, generation of leaders? Because when I think the deepest risk to the public health infrastructure in this country right now is honestly not the funding cuts. Funding cuts are survivable, we will come back from that. You know, we are just a nation that's very resilient. So times might be tough or we will come out of this stronger. On the other side, when you find efficiencies, you'll advocate, you adapt. What's not survivable as I look to the future is are the leaders there, are we developing the leaders enough to be able to, to run these systems, who came here from a purpose, who understand the mission at a granular level, level that aren't just going to burn out. Like I said, I came from the private sector deliberately. I did it because I believe this work matters. It's. I know it's us, not I'm not the norm, but most people with my background, like earlier on I said, moving the opposite direction. And the question I want answered is are we finding the right talent? Are we developing those right leaders? Because this, what's happening right now is just something out of it. Any administration come in the future, fix it. Then the next administrator comes in and puts it back, you know, us, 10, 20 years. But we need the leaders who are willing to be adaptable, that are willing to weather the storm and willing to continue to move along, to continue to protect our backbone of this country, which is the safety net, public hospitals. And I'll leave it off with that. I think that's something we're, you know, as other leaders to think about and hopefully we can start thinking about and start having those conversations. Honestly.
- [23:18]
A
Yeah, no, I think some fantastic closing thoughts to close us out. Fascinating story. So greatly appreciate, so greatly respect the work that you and your team are doing at the county of Santa Clara health system and similar public safety net systems out there. Thank you so much for shining a light in such an important topic. We really, really appreciate it.
- [23:36]
B
Thank you so much for having me. Take care. It.