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Effective financial management is a cornerstone of a successful healthcare administrative practice. It involves much more than just “balancing the books”; it’s about ensuring that resources are allocated efficiently and effectively in order to provide optimal patient care. In this article, Keith Hovan delves into the critical role that financial management plays in healthcare administration, emphasizing how administrators must navigate the budgeting process, control costs, and optimize the allocation of resources in order to promote the best possible outcomes for the organization and those that it serves.

Planning and Allocating Budgets

Budgeting in healthcare organizations involves the critical analysis of data, careful planning and the allocation of financial resources in a manner that promote the achievement of organizational goals while providing consistent, high-quality care. This process begins with a thorough assessment of the organization’s strategic goals and the related funding needs, including staffing, equipment, technology, and facility requirements. By aligning budgets with strategic priorities, healthcare leaders ensure that resources are allocated where they are needed most, ultimately promoting the delivery of the best care to patients.

Cost Control and Reduction Strategies

Controlling costs is a critical aspect of financial management in healthcare. Healthcare leaders must implement strategies to reduce unnecessary expenses without compromising the quality of care. The use of LEAN and Six-Sigma tools and techniques in the setting of a healthcare delivery system is often a great place to get started. Standardizing processes and reducing variation can produce more predictable outcomes at lower unit costs. Other strategies for reducing costs may involve negotiating with vendors for better pricing, implementing more cost-effective procedures or technologies, and streamlining operational processes. By identifying areas where costs can be controlled and reduced, leaders can allocate resources more efficiently, ultimately contributing to the overall financial health of the organization.

Optimizing Revenue Streams

Healthcare leaders must also focus on revenue to support the organization’s financial health. This involves ensuring that the organization is appropriately reimbursed for services rendered, optimizing insurance billing processes, and exploring opportunities for new revenue sources. By identifying and acting on revenue-generating opportunities, leaders can enhance financial stability and allocate resources to support their organization’s strategies and initiatives. When evaluating any revenue producing or enhancement opportunity healthcare leaders must ensure compliance with all applicable laws, rules and regulations.

Investments in Technology and Infrastructure

Making ongoing investments in technology and infrastructure is essential for modern healthcare organizations. Around the world, massive amounts of data are being collected and analyzed constantly in order to provide enhanced patient diagnosis and treatment, which leads to improved outcomes. Access to large data repositories also serves to assist government agencies with promulgating and implementing sound public health policies.

Healthcare administrators must strategically allocate resources to implement and maintain state-of-the-art facilities that enhance patient care, improve operational efficiency, and support clinical program initiatives. These include electronic health record systems, telemedicine platforms, and advanced diagnostic equipment.

Risk Management and Financial Sustainability

Healthcare leaders also play a crucial role in risk management, which is closely linked to financial sustainability. By identifying potential financial risks, such as regulatory compliance issues, reimbursement challenges, or unexpected expenses, leaders can work to develop strategies that mitigate these risks and ensure the organization’s long-term financial viability. This proactive approach to reducing risk greatly contributes to overall organizational outcomes by safeguarding resources and ensuring continuity of care.

Conclusion

The management of a healthcare organization’s financial well-being is a fundamental aspect of healthcare leadership that can directly impacts the quality of care and services provided to patients. By carefully planning and allocating budgets in alignment with strategic goals, controlling costs, optimizing revenue streams, and investing in infrastructure, healthcare leaders can contribute to the overall wellness of their organizations. Additionally, a focus on risk management ensures that resources are allocated as effectively as possible to support optimal patient outcomes. Through effective financial management, healthcare leaders play a pivotal role in promoting wellness within healthcare organizations and, ultimately, the broader community.

Founded in 2019, the Friends of Jack Foundation aims to offer and expand programs that benefit children’s and families’ physical, emotional, and mental health. And as of August 2023, FAILSAFE Health’s CEO Keith Hovan and his wife Erin Hovan are supporting the Foundation’s Food for Tots Fundraising efforts.

Since it began in 2018, Food for Tots has raised more than $150,000, with over 30 restaurants from towns and cities across the South Coast area participating. With Keith’s support, it’s set to gain more.

Using Executive Position for Philanthropy

The healthcare technology start-up made up of a cross-functional executive team from healthcare and technology verticals, FAILSAFE Health, announced the appointment of Hovan as the CEO and president in May 2023.

Within the announcement, Ray Romagnolo, founder, noted they feel fortunate to have Hovan join their leadership team after working alongside them since the beginning of 2022. The company is harnessing advanced AI technology to form a mash-up of digital and physical medical services networks — something that he brings extensive amounts of expertise and experience from his many of years as a well-respected healthcare leader.

Among the appointed CEO’s talents are operational turnarounds, care quality, patient safety, performance improvements, community relations, improved governance, clinician engagementand innovation. Romagnolo mentioned he was positively impacted by Hovan’s work in his last CEO-level position at Southcoast Health, where he created dramatic enhancements in the enterprise that serves the local region. This was undoubtably the foundation that made him the logical choice to head FAILSAFE Health.

For some, this level of professional success could impact their want to contribute to good causes. But this does not stand true for Keith who, alongside his wife Erin, is proudly standing with the Friends of Jack Foundation and their Food for Tots endeavor. While he’s pleased to be named as the leader of the Failsafe Health organization, it’s his philanthropic efforts that mean the most to this charitable fellow.

Support of the Food for Tots Fundraiser

During his announcement of his support for the Foundation and its latest fundraising efforts, Hovan said he and his wife are immensely proud to support the charity’s amazing work. He went on to note the Foundation’s mission, which supports underserved healthcare programs for children in Providence and the South Coast of Massachusetts.

The fundraiser took place on various dates, throughout the Massachusetts South Coast region, where over 30 restaurants donated a portion of patron’s meal receipts to the Friends of Jack Foundation.

The Future is Bright for the Foundation

Before joining the FAILSAFE Health team, Keith served in many senior executive positions, with his next most recent stint being 13+ years as Southcoast Health System’s CEO and president. He was also the executive vice president and chief operating officer at Danbury Health System in Connecticut. And it’s this experience and influence that he will use to support the charitable causes he believes in to promote their successes in the future.

Operating a medical practice can be a complex and challenging task. It requires not only a deep understanding of clinical care, but also a strong grasp of business and operational demands.

Fortunately, Keith Hovan explains that there are a variety of resources available to support the needs of medical practices, helping to streamline operations, improve patient outcomes, and stay ahead in the ever-evolving healthcare landscape.

According to business advisors and experts, understanding where a business is at financially, as well as in terms of resources such as equipment and staffing, allows companies to effectively meet their operational needs – this is especially true for physician practices at all levels of healthcare.

Adapt to Change

As the industry continues to evolve, medical practices face increasing pressure to adapt to changes in regulations, technology, and patient expectations. To stay competitive while providing quality care, doctors’ offices must stay properly equipped to support their patients, staff, and business needs.

Technology

Software that automates the process of meeting a patient’s needs is usually an effective investment, especially if it draws both new and returning patients to the practice. Some popular examples of such technologies include telehealth services, electronic health records, and interactive communication platforms.

Electronic health records (EHRs) can help practices track vast amounts of various types of data, such as appointment schedules, patient-related tasks, documentation of phone calls and messages, and compliance.

Similarly, practice management software can help with billing, coding, and scheduling for patients and staff, while communication platforms provide a consistently available contact method.

Tracking Data and Finances

A key aspect of any business is to focus on the metrics that are relevant to daily operations. In a physician practice, this may include the length of appointments and wait times, the number of patients associated with the practice, or the number of visits a practitioner warrants in increments of days, months, or throughout the year.

Financial-related metrics are also important. For example, insurance billings and collected copayments should be tracked and then balanced at the end of each day. The overall financial management of a physician practice can become especially challenging for larger organizations due to the complexity of healthcare billing and reimbursement. Some offices may heavily benefit from working with consulting firms that specialize in healthcare finances.

Protect the Assets of the Business

With the above steps in place, a successful medical practice will need asset protection. It is important to plan for unexpected scenarios with staff, supply shortages, or extended closure periods.

Additionally, the importance of cybersecurity should never be overlooked. Train employees to guard against ransomware, be wary of email phishing, and utilize strong, frequently changed passwords. Add security programs to protect against industry-specific risks, or consider adding multi-factor identification to avoid any data breaches.

Patient Care

Last but certainly not least is to maintain a strong focus on patient care. At the end of the day, the goal of any medical practice is to provide high-quality healthcare to patients. Practices can improve patient outcomes by implementing evidence-based clinical guidelines, measuring, and tracking techniques while utilizing patient feedback to drive improvements.

In Conclusion

At the end of the day, a medical practice is a business, but one that is best supported by responsibly managing patient care, data, compliance regulations, and financial ambitions.
By leveraging the right tools and technologies, practices can improve their operations, achieve their goals, and thrive in the constantly advancing healthcare landscape.

Healthcare executives are the unsung heroes of the wider field, frequently working behind the scenes to ensure that important decisions are made correctly for the facility or institution. While responsible for overseeing the development of appropriate policies and budgets, they must also be focused on bettering patient experiences and enhancing safety. Without their leadership organizational performance and long term viability would be at risk.

These professionals are responsible for entirely functions of the industry from those delivering patient care; i.e. physicians and nurses, but they are certainly just as crucial. Unlike practitioners who manage patients directly, healthcare executives like Keith Hovan have in-depth knowledge of the regulatory framework, overseeing the system that delivers services itself, working in partnership with clinicians.

Understanding the Importance of These Executives

Healthcare executives often oversee a healthcare system delivering services for a large geographical area. These professionals are responsible for ensuring the continual delivery of safe and effective patient care.

Not only do executives need expertise in healthcare best practices, but they require knowledge in traditional business processes to:

• Ensure the departments, services, or organizations they oversee deliver effective healthcare.
• Lead the departments, services, or organizations they oversee, ensuring they’re always maintain efficient operations.

Entities that cannot accomplish the above will not survive in today’s fast-paced, highly competitive climate. Thus, highly competent healthcare executives are the backbones of nation’s healthcare delivery system.

The Roles and Responsibilities

Healthcare executives have mission-critical responsibilities for more than just financial outcomes, making it a particularly demanding role.

On the business side, healthcare executives require knowledge, experience, and expertise in:

• Strategic planning
• Human resources
• Project management
• Policy development and implementation
• Finance
• Operations
• Supervision
• Decision-making
• Government relations
• Payer relations

On the healthcare delivery front, they must have proficiency in healthcare systems, service delivery, and related topics, such as:

• Physician/provider relations
• Quality assurance and safety
• Ethics
• Risk management
• Other practices necessary for managing a safe and effective healthcare environment.

Naturally, specific roles and responsibilities can change depending on the business type (i.e., hospitals, home health agencies, government entities, insurance companies, outpatient clinics, medical practices, etc.). However, all tend to use the above-mentioned skills, experience, and knowledge to:

• Manage the complexities of day to day operations
• Manage all aspects of financial performance
• Snsure facility compliance with regulatory and legal requirements
• Recruit and retain the best staff members.
• Communicate with providers and support staff
• Maintain credit worthiness
• Ensure effective governance of the organization
• Continuously improve organizational efficiency and quality

Demand for the Leadership Roles Set to Grow

According to a report from the Bureau of Labor Statistics, employment of healthcare leaders is expected to rise considerably throughout the next decade.

Leadership roles within the industry have the potential for career advancement with the projected growth of the top four roles between 2020 and 2030 being:

• Medical and health services managers are expected to experience a growth of 28%.
• Administrative services and facility managers are projected to see 7% growth.
• Human resource managers and medical records/health information specialists are also anticipated to grow by 7%.

The Backbones of the Nation’s Medical Organizations

Within the intricate web of our nation’s healthcare landscape, healthcare executives emerge as the unsung heroes, weaving together the threads of efficiency, compassion, and strategic vision. Their tireless dedication ensures that the gears of healthcare delivery system always turn smoothly, ultimately translating to better patient care and outcomes. As we celebrate the pivotal role of healthcare executives, let us remember that they are not merely the backbone, but a driving force behind the nation’s medical care, shaping a healthier future for us all.

Increased awareness of ever-rising healthcare costs, medical malpractice, and a record-high number of Americans suffering preventable harm in healthcare settings that can result in permanent disability or death highlight the importance of enhancing the the quality of healthcare delivered in our nation. And Keith Hovan explains that many providers of medical services are already paving the way for an improved healthcare future.

Entities can use a wealth of strategies to enhance the quality of their services, improving patient outcomes, lowering costs and reducing the likelihood of malpractice. Experts consider the following five tips the most effective for bettering the quality of healthcare.

Measuring and Analyzing Outcomes

Anyone familiar with the principles of business management will know the Peter Drucker quote, “if you can’t measure it, you can’t manage it,” — and the same applies to the healthcare industry.

Practitioners can’t make improvements if they don’t understand the opportunities available for improvement. Upon establishing baseline outcomes, providers can look at data to find trends and patterns allowing them to discover critical areas requiring enhancements.

Tracking patient outcomes should be rigorous, ensuring practices have a wealth of data to examine and build from.

Implementing Evidence-Based Practices

Evidence-based medicine (EBP) is dubbed one of the most important medical advancements of the 20th century, influencing spheres even beyond heath. And due to the characteristics of quality improvement and evidence-based practices, they’re complementary.

Essentially, one cannot exist without the other. EBP was once the gold standard for promoting standardization and reducing the variation of quality within the industry, but research has shown that it’s best when combined with other improvement efforts.

Eliminating Human Factors In Errors

Human factors relBasic ate to the limits of human abilities and characteristics. It’s useful to consider them when designing tools, tasks, systems, machines, environments, and jobs for safe, effective, and comfortable human use. Thus, it should be utilized in the improvement of healthcare.

According to the experts at Harvard, a few key human factors and principles should be included in the enhancement of the healthcare industry, including:

• Eradicating reliance on memory
• Utilizing checklists and clear protocols
• Using standard procedures across all facilities

The National Center for Human Factors in Healthcare goes a step further, detailing human factors that should be utilized in the design of systems and processes, such as:

• Increased efficiency
• Enhancing communication between providers
• Understanding medical conditions better
• Reducing the risk of IT-related and medical device errors

Committing to Ongoing Evaluation with Goal Setting

Goal setting can be challenging for healthcare providers. When setting goals they can look to the National Quality Forum, Quality Payment Program, and the Agency for Healthcare Research and Quality for evidence-based guidelines on goal development and prioritization.

Once prioritized, practices must commit to ongoing evaluation to accelerate improvements in quality and ensure performance never stagnates. After all, healthcare isn’t a set-it-and-forget-it ordeal.

Practitioners who utilize the basic PDSA (plan-do-study-act) cycle benefit from increased improvements over those who do not.

Improving Healthcare Access for All

Improvements across the spectrum of healthcare providers from individual practitioners to large multi-site healthsystems must also focus on the creation of effective and equitable access for all. Healthcare should be considered a basic human right. Therefore ensuring appropriate access to care is the most impactful factor for improving patient outcomes. Patients must reach the proper care at the right time in order to achieve the desired results. Despite efforts undertaken over the past two decades there remains a segment of our nation’s population that are uninsured or underinsured. Leveling the field and providing timely and equitable access for all is one of the most important thing that the healthcare industry can accomplish.

The world of healthcare is in a constant state of change, through large disruptors such as medical and technology breakthroughs, and more granular changes such as ongoing process improvements throughout every element of the delivery system. There are many skills required in order to maintain an effective delivery system of care and services for patients and their families.

Keith Hovan explains that doctors and nurses are constantly supported by healthcare leaders; from managers to senior executives, who are responsible for promoting an environment that embraces change in order to constantly improve, to be better. These responsibilities, while varying some, based on whether it is an inpatient setting or outpatient practice, share one commonality: the impact on the health care system and the goal of making it better.

Common Duties for A Healthcare Leader

Healthcare leaders, or those who are looking to join the field, should know that the position requires the ability to work within teams more than any other trait. Here’s a short list of duties that professionals should expect to have in this position, though these may change depending on need or location:

• Ensuring the environment promotes the delivery of high quality and safe care
• Managing and leading multi-disciplinary teams
• Creating and managing budgets
• Ensuring compliance with regulations
• Developing work schedules
• Managing patient fee schedules and billing practices
• Improving facility efficiency and effectiveness
• Training and education of staff
• Communicating with doctors, nurses, and members of the care delivery team in an effective manner
• Working with governing boards and other key stakeholders

In addition to these duties, one of the biggest common grounds that all healthcare leaders have, regardless of location, is a robust knowledge of compliance with the applicable rules, regulations and laws both federal and state, that relate to the services that are provided by their organization.

More detailed explanations related to select responsibilities are discussed below.

Managing People

A major responsibility of a healthcare leader is managing people. The leader is responsible for creating a positive work environment that places importance on team as well as individual performance. Leaders often have direct hire and fire responsibility so the selection of new team members through the interview/selection process is crucial. Keith Hovan states that setting measurable goals and objectives that are clearly understood by every member of the team is critical.

Overseeing budgets

The budget is a financial roadmap for resource allocation and the distribution of services in a given department of area. The budget outlines how much should be spent and/or earned for specific services or interventions in a given period. Having noted that, healthcare delivery and demand for services is often unpredictable. Demand may be driven by the burden of disease in a community. An example could be the number of individuals being treated for influenza. The number of patients needing care can be effected by the number who previously received flu shots or the virulence of the disease. Circumstances outside the leaders control can impact revenue or costs that will cause priorities to change hence requiring leaders to be active managers of their budgets.

Ensuring compliance within regulations

The field healthcare delivery is one of the most complex areas to practice in given its highly regulated environment which includes federal and state laws as well as accrediting body rules and requirements. This means that healthcare leaders need to maintain current knowledge related to all required areas of compliance and be able to communicate those expectations in an understandable manner to all staff.

On a daily basis healthcare leaders must oversee the quality of medical care delivered by providers in their facility to ensure that patients receive safe and effective care. Leaders must also ensure that accurate documentation and billing of patient encounters occurs in a manner compliant with laws and regulations.

The Future of Healthcare Leadership

The future of healthcare leadership is bright and evergrowing. Because of industry diversity, those who pursue such a career may find themselves in a range of working environments: from small private practices, to larger clinic settings, to large health systems.

Regardless of where they find themselves, healthcare leaders should know that they’re a major part of the health ecosystem and have an opportunity to positively impact the lives of many.

Many professionals automatically say “yes” to board positions without considering the organization’s mission, vision and values. Most organizations want active participation for the entire length of service. Therefore, clarity is everything when considering a role as a director or trustee.

Keith Hovan explains that individuals who accept board invitations without much forethought or research often fail to deliver on the required commitment. Serving means sharing the same values as the organization, which won’t be clear unless professionals consider these questions before agreeing.

What Does the Board Want from Its Members

Organizations don’t tend to ask professionals to join their boards for appearances, or status. Instead, they approach individuals they believe could offer value to the business.

More often than not, boards recruit people they already know or have noticed support the organization of their own initiative. However, that isn’t always the case. Sometimes, they’re searching for a particular set of skills or understand the person has been generous in other situations, improving their chances of acquiring philanthropic support.

Professionals asked to serve on a board should determine precisely why they were nominated. That way, they’ll understand the expectations and whether they have the capacity or skills to meet them.

The Values

Similar to the above, potential board members should completely understand the organization’s mission before accepting the invitation.

One simple question goes a long way here:

Do the organization’s vision and values align with my own goals, values, and passions?

Think of it this way — organizations offering services to distressed communities will often have different values than boards of for-profit companies. One returns profits to the community served the other to shareholders.

It’s no secret that board members who are aligned with the overarching mission and day-to-day activities of the involved organization perform better.

Committing to the Necessary Duties

Unbeknownst to popular belief, joining a board isn’t the same as joining a professional organization or club where effort is optional. Instead, it’s an entire commitment. Individuals who accept serving invitations are pledging their skills, time, and energy to contribute meaningfully to entities’ missions.

There’s a lot of misunderstanding about the actual responsibilities of boards.

Some people believe the boards run the organization. But that isn’t true; they guide it and ensure strategies are executed correctly to increase the chances of achieving goals.

Typically, board members have three entity-based duties:

• Duty of care — It’s a legal responsibility that all serving individuals will act prudently to protect the organization from avoidable harm or risk.
• Duty of loyalty — Board members must be dedicated to doing the right thing for the entity, putting its interests ahead of their own.
• Duty of obedience — In highly regulated industries, obedience to legislation, licenses, and other mandates is essential.

Professionals asked to serve on boards should carefully consider the above questions before agreeing to commit their time and efforts.

Healthcare needs are constantly changing.

People are living longer. Conditions once common become rare, while others require steadfast research to improve treatments. Many patients visit a medical care specialist before a primary care physician.

Some people opt to receive treatment and medical advice virtually without ever stepping foot in a hospital. Welcome to the wild world of healthtech.

Keith Hovan explains that technology is racing to keep up with modern medicine, improve efficiency, and help offer patients access to the care they still need and want. It’s personalized care with a futuristic twist.

And the opportunities are endless. In this brave new world of medical care, technology is leading the way. Here are some of the biggest ways technology is improving healthcare so far.

Efficiency and Better Communication

The rise of electronic health records (EHRs) has gone a long way to improve the safety of care provided by doctors and the speed at which patients can have access to detailed information about their health.

Patients can get test results in minutes online. Medical histories can be transferred in seconds between physicians and specialists around the world.

Medical teams can access the same health information at any given time to collectively make treatment plans through timely information.

Ever have to wait days for a doctor’s office to set up an appointment or provide medical information? That’s quickly becoming a thing of the past.

Access

For far too long, quality healthcare was not available to millions simply because of physical limitations and distance — and often because of sky-high costs. Telehealth is changing the game.

Instead of requiring a visit to a doctor’s office, telehealth now offers an option to significantly lower costs while still getting the level of care that’s actually needed.

This comes in many forms, from virtual doctor’s visits to camera and wi-fi connected technology used by patients to document their health and send back the information for diagnosis. Such approaches greatly lower medical costs and have been shown to reduce the need for visits to an emergency room.

Such remote monitoring tools are usually customized for individual patients and can help those newly experiencing a minor health condition or those who live with chronic illnesses. In many cases, wearable technology has become the norm in monitoring and diagnosing potential health issues.

Reducing Errors

Medical errors can be devastating. Studies have consistently shown that mistakes by doctors or other forms of medical harm have led to the death of more than 250,00 a year. Such errors are often preventable.

In addition to EHRs, digital medical upgrades have been shown to reduce the number of serious medical errors every year. Companies such as DrFirst and Allscripts offer electronic prescriptions. Patient safety is improved via medical alerts and clinical flags noted on patient charts.

Genome Sequencing

In 2021, the first fully complete human genome was sequenced. That wouldn’t have happened with advanced health technology. Now, the information can guide many uses of healthcare technology since it can identify a genetic risk of disease and may lead to better treatment options.