How has your role as CFO changed since you started?
Jennifer Mitzner: I’ve been with St. Joseph Hoag Health for a year and a half, following the affiliation of St. Joseph Health and Hoag. My role has evolved over the years. Historically, the role of the CFO has been rather transactional, and oriented around ‘protecting the balance sheet.’ Today, the role is more about serving as a strategic partner and advisor, yet still protecting the balance sheet and ‘creating a balance sheet.’ Deep knowledge of operations and a solid sense of risk and relationships are key attributes and capabilities in serving as a strategic advisor.
What’s your current outlook on the business of healthcare today?
Mitzner: Healthcare is an industry that is adapting to changing subsidies and economic drivers. Transparency and consumerism are having a disruptive effect on the economics of healthcare, which I believe is ultimately
The business of healthcare is also heavily reliant on effective leadership and teamwork—be it engaging clinicians in working to improve the cost and quality of care, or partnering with new and different stakeholders to find innovative ways to drive value. Critical to that success is understanding what’s motivating other parties, aligning common values, and then configuring the right economic alignments that support fair and effective partnerships.
“Healthcare is increasingly becoming a consumer business.”
Recently, I had the opportunity to be part of a team that was developing a new specialty hospital, a joint-ventured project by a nonprofit community hospital and specialized surgeons in the market. We approached that as an opportunity to improve the outcomes and quality of that service for the community. Through shared governance and by positioning the physicians in leadership roles, the results have shown dramatically improved quality outcomes and safety measures, as well as reduced costs. This is where I see the future of healthcare: new partnerships finding innovative ways to create value in the marketplace for the community.
Consumerism is also a market force that will have a significant impact on the industry. As individuals take on an increasingly larger share of the cost, providers must seek new ways to develop and then lock in direct relationships with consumers. New entrants to the market are here and will disrupt that relationship if providers do not quickly adapt the new capabilities needed in this customer-relationship space.
How are you responding to the industry’s tremendous demand for lower costs?
Mitzner:It is an active, explicit, and intentional strategic priority for us. We believe lowering costs is best achieved and more sustainable when handled through the lens of the total cost of care. Our organization has been very deliberate in measuring more than just the unit price. By focusing on total cost of care, we’re able to bring physicians and other partners to the table and work on redesigning care.
We’re also very explicit in the area of what we call “clinical effectiveness,” which looks at reducing variation within individual hospitals and across the marketplace of multiple hospitals and providers.
On a broader level, we’re working to ensure that our structure, and the way in which we’re organized, facilitates more nimbleness in our decision-making and the way we implement those decisions. Furthermore, we recognize that physician leadership is essential to effectively manage patient care from both a delivery and care-management perspective.
From a cost perspective, we’re striving to be more proactive in understanding the price point that we need to be in the market, particularly on the commercial side.
At the highest level, one of our key deliverables is developing a business model that’s sustainable. Like most other healthcare organizations, we have one foot in traditional fee-for-service business, with the other foot pretty firmly in the risk-based business. A big part of the business model is developing how to most effectively manage that transition. I see that very much as a journey as opposed to as an annual planning event. It’s very much a work in progress.
You have a unique recruiting strategy. How does hiring outside the healthcare industry benefit St. Joseph Hoag Health?
Mitzner: The competition for talent is high within healthcare. In my own experience, there have been a few scenarios where we intentionally sought out-of-industry talent and capabilities. I would say in the area of marketing in particular, recognition that healthcare is increasingly becoming a consumer business—or, at minimum, influenced by more consumer-driven trends—is crucial. Recruiting out of the industry in certain areas gives us the ability to leapfrog a bit in some of those tactics, and also have someone at the leadership table to challenge status quo.
How do you balance business with the organization’s mission?
Mitzner: Balancing the demands of business with the organization’s mission is critical for the CFO, particularly in a faith-based organization such as ours. It has become increasingly difficult as healthcare becomes more business-like. That said, we believe access to our services as a quality healthcare provider is critically linked to our mission. If our price point is too high and our community can’t access us through their insurance, then we’re not fulfilling our mission.
On another hand, we need to manage our price point so that we’re better able to take on and care for more of the financially challenged population. As a CFO, I link access to care and insurance coverage directly to our mission. I think that’s an important way to keep the mission front and center, particularly in the business discussions.
One of the reasons the St. Joseph Hoag Health entity now exists is that the two like-minded organizations, Hoag and St. Joseph Health, realized a unified goal. By coming together, particularly in Orange County, we would be able to better advance the principles and mission of faith-based, nonprofit care. While we do that in many areas, one of our explicit commitments is to serve the Medicaid population in a more meaningful and population-health-based way. That ties back into access of care, quality, and mission.