The concept of punctuated equilibrium refers to systems that experience isolated episodes of dramatic evolution intermixed with long periods of stasis or something close to it. Dennis Dahlen, who on Tuesday morning was installed as HFMA’s National Chair for FY23-24, thinks the hypothesis applies to healthcare.
Speaking to Annual Conference attendees, Dahlen, the CFO of Mayo Clinic, noted the industry periodically undergoes significant events such as the development of anesthesia, which revolutionized surgery.
Another such window may be imminent, he said: “Does the [current] convergence of science, technology, policy and culture create an environment for punctuated equilibrium?”
For healthcare finance professionals, the next question is, “Can we be the punctuation in the equilibrium we’re in? I believe we can be,” Dahlen said during Tuesday’s keynote session in Nashville.
That faith spurred the choice of his Chair year theme: It’s time. The theme came about, in part, from a sense that “we’re not moving fast enough or making enough of a difference. I was fascinated by the duality of the duress in the industry and opportunities in discovery and innovation. And it reminded me of the wisdom of not letting a good crisis go to waste.”
For hospitals, “The most recent calendar year has been marked with unprecedented losses and performance declines year-over-year,” said Dahlen, a 40-year industry veteran. “Even the best-positioned hospitals, the market-essential ones, are suffering losses.”
He added, “No one who is paying attention believes that what we all do together is optimal or sustainable.” He pointed to findings that between 30% and 50% of healthcare spending is waste, while between 15% and 30% is spent on administration — half of which is waste.
Dahlen referred to HFMA’s stated mission: “To lead the financial management of healthcare.” The statement “confers on us some responsibility individually, and explicit responsibility on the Association, to do something other than perpetuate waste and underperformance.
“We could perhaps be forgiven for abrogating that responsibility if the future were hopeless, but nothing could be further from the truth.”
Cause for optimism
Amid “significant trauma and reason for concern,” Dahlen said, the current environment also “is a time of discovery, innovation, promise.”
Clinical breakthroughs are happening at a rapid pace, for instance, including what could be a game-changing treatment (teplizumab) for diabetes. Also, Mayo Clinic is studying cellular senescence, a potential route to preventing aging-related disease.
On the technological side, Dahlen said, “The proliferation and mass assemblage of clinical, demographic and genomic data to power research and diagnostics promises to accelerate medical research and create artificial intelligence that just might allow us to use technology to improve on and/or replace [some] humans as the caregivers.”
Leading the charge
The ongoing industry disruption makes it even more important for traditional providers to realize their value proposition, including by improving the cost effectiveness of health (CEoH). HFMA has been emphasizing that concept for the last couple of years, and Dahlen wants the focus to ramp up over the next 12 months.
“My hope is that we’ll exit the year firmly engaged as an association in the bigger picture of improving the industry that we all work in — reducing costs, increasing convenience and access, and improving health. I’m confident HFMA will be leaning in at the national level with specific initiatives.”
He referred to new collaborations on price transparency, tools for generating data and insights, benchmarking and metrics on various dimensions of performance, and partnerships to generate thought leadership around CEoH.
“As individuals and leaders, it is imperative that we all lean in as well,” Dahlen said. “I ask you to be on the lookout for innovative solutions that can make a difference on the big picture of cost, convenience and results.”
2 HFMA members honored for storied careers
Also during Tuesday morning’s Annual Conference proceedings, HFMA presented the 2023 Frederick C. Morgan Individual Achievement Award to James L. Heffernan, FHFMA, MBA, and Kenneth Stoll. The award recognizes career-long contributions to HFMA and the profession of healthcare finance.
Heffernan spent 25 years as senior vice president of finance and treasurer with the Massachusetts General Physicians Organization, playing a central role in strategic planning for one of the largest physician group practices in New England and for Massachusetts General Hospital. He’s served HFMA since the 1980s at the chapter, regional and national levels.
“Throughout my career, HFMA has been a continuous source of information and help,” Heffernan said. “Through programs or outreach to specific individuals, I have been able to introduce to my organization innovative concepts from coding systems and introduction to DRGs in the late seventies and early eighties, freestanding surgery and imaging centers in the eighties, capitated systems in the nineties, mergers and acquisitions in the 2000 aughts, and even venture capital deals in the 2010s.
“The point is, over and over again, I could find experience and knowledge through HFMA that made a real difference to my organization.”
Heffernan also spoke to the sense of community and service fostered by the Association.
“I am forever grateful to HFMA for being an organization where we expect our members to help each other,” he said. “Friendships and professional relationships have grown and been at the root of my HFMA experience.”
Reflecting on a spirit of giving
Stoll has spent more than two decades in leadership positions with revenue cycle companies, including UCB (United Collection Bureau) for more than 22 years and RevSpring since 2020. An HFMA member since 1997, Stoll has served in support and leadership roles at all levels of the Association, including on the board of the Central Ohio Chapter for nearly 20 years.
As president in 2007-11, his efforts to reorganize the leadership structure helped the Chapter earn six national HFMA awards in 2010 alone.
He also helped establish a structure of giving back that has spurred initiatives such as serving at a local soup kitchen, distributing socks to homeless people and providing first-aid kits to an organization that supports women who have been victims of sex trafficking.
“Thank you for this wonderful recognition and for those I’ve had the pleasure to meet, serve and volunteer together,” Stoll said.