“Planning in uncertain times” is a recurring topic in our conversations with healthcare finance leaders, usually in reference to challenges such as value-based payments, consumerism, forecasting, and so on, but the COVID-19 outbreak has put that into an entirely new context. As the situation continues to change and evolve, there’s an ever-increasing demand on analytics to minimize uncertainty, inform the business of healthcare, and support caregivers on the front lines.

To better understand exactly what hospitals need from their finance teams, we’ve been talking with healthcare clients to understand how their roles are changing and how they are supporting both leadership and the front-line workers managing COVID-19. Their feedback and insights are valuable to every hospital or health system trying to prepare, respond, and overcome the COVID-19 outbreak.

Here’s what clients say is important:


Analyzing data and supporting caregivers on the front lines

Curtis Bryan, Director of Financial Decision Support at MultiCare Health System, a large multi-entity health system located in a Tacoma, Washington, shared perspectives from a region that was at the epicenter of the early outbreak of COVID-19. Bryan’s team mobilized early to assess the near-term financial impacts of the shift the organization was making to reduce elective surgeries and prepare for COVID-19 volumes. 

With no historical data to model, Decision Support tools played a vital role in understanding the financial profiles of similar case types, such as pneumonia and influenza. They analyzed the impacts that shift would have on surgical volumes, specifically what percentage of surgical cases were truly elective while factoring in the anticipated demand on surgeries coming from the ED. The simulations also had to consider the potential reduction in ED trauma cases if ‘shelter in place’ ordinances were reducing traffic volumes and accidents.

“Within our Finance teams, we are all-hands on deck to do whatever we can to support our front-line workers,” Bryan said. “That includes data and financial analysis, of course, and for those of us who can, we are volunteering in other areas of the hospital to support administrative tasks and even help fit caregivers with N95 respirator masks.”


Providing key insights to track what’s coming

In many parts of the country, hospitals and health systems are still waiting for the outbreak to hit their areas. Here, reviewing data to help anticipate volumes and prepare for the impact is critical.

We spoke to one client who is providing daily reports to help understand trends and respond to needs as they arise. 

“We’re doing what we can to collect and analyze data that helps caregivers and leaders prepare for what’s coming,” he said. “We’ve enabled our dashboards to collect and consolidate daily statistics across all entities to give us visibility into important indicators such as number of confirmed COVID-19 admissions, COVID-19 tests conducted, and inventory levels related to protective clothing, gloves, and ventilators.”

As inventory and supply chain challenges increase, understanding what’s on hand is key to determining where to focus efforts to secure critical equipment for staff and patients.


Projecting losses and ensuring adequate cash flow

West Tennessee Healthcare covers a rural market between Memphis and Nashville, Tennessee, and has also seen low numbers of confirmed cases. They’re grappling with losses from cancelled elective procedures, low inpatient volumes, and slow ER activity. By using their financial planning software to review recent volume declines compared to budgets and forecasts, they project an estimated impact of about $50 million over the next few months, according to Chief Financial Officer Jeff Blankenship.

As of March 27, activity at West Tennessee Healthcare is so low that they’ve sent caregivers home. Finance teams are working with partners like banks to make sure they can pay employees and are considering extending lines of credit to help improve cash flow through the next couple months. They’re also in close communication with payers to understand when and if payments will be affected — so far there’s been no change.

“We’ve asked each of our finance leaders to prepare an analysis of the revenue that would be lost over a two-month period, which is arbitrary since we don’t know when things will go back to normal, but for now we’re assuming a two-month period,” Blankenship said. “Going forward, I think we've got to identify more opportunities to cut costs and get lean. COVID-19 makes that even more important than before and we’re hoping to use comparative analysis to identify where we should start in terms of reducing costs or looking for efficiency.”


Determining the right steps to take for your hospital or health system

Talking with clients has made it clear that while there is much that we cannot control, agile planning and analysis are essential to guiding decisions on the things we can control, such as preparation and response activities.

People in finance roles can contribute valuable information and resources to combat the outbreak by analyzing data and modeling possible scenarios to help decision-makers manage through the immediate challenge and establish the planning capabilities needed to get back on track post-COVID-19.

Here are the key action items for finance leaders to take during the coronavirus outbreak:

  1. Review your volumes, revenues, and costs for elective procedures. Be prepared to use this information to model the downturn effects.
  2. Understand related-services impacts. ED and trauma cases will decline as people shelter in place; estimate how much revenue you may lose as a result.
  3. Monitor relevant data on a daily basis. Weekly and monthly updates are not timely enough in periods of rapid change.
  4. Reach out to partners for help, whether suppliers, banks, or technology vendors, everyone is in this together and you may be surprised at how other organizations are able to help.