Making Health the CFO’s Business

The stereotypical Chief Financial Officer is skeptical, always in need of quantifiable proof, and let’s face it, a bit reserved (as a CFO, I can say such things). With that, I was actually very pleased to see the results of a recent study by IBI and CFO Research Services noting more and more CFOs are realizing the health of a company’s employees is playing a growing role in the health of a company’s bottom line. The findings focused on employee health as a financial and cultural driver as well as the type of information CFOs need to justify an investment in wellness. With healthcare costs continuing to climb at double-digit rates and with well over 50% of health care costs attributed to individual, modifiable behaviors, each employee’s engagement in their health and wellness can no longer be ignored. 

Of the 313 CFOs surveyed, the majority described poor employee health as having a significant impact on an organization’s financial success through such productivity factors as opportunity costs, sick leave and turnover. Some additional noteworthy findings include:

  • Two-thirds believe health is a cultural and/or financial priority with 60% indicating poor health drives increased health care costs
  • 45% noted workforce productivity as one of the most important factors impacting financial performance. With that, 90% agreed improving health contributes to increased productivity (30% rated is very important) and 40% noted poor health having a significant impact on sick days
  • 80% said finance plays a role in healthcare benefit decisions in their organization

Of course, any valued wellness partner also needs to show us the money. I’m all for creating a healthier, happier workforce and culture, but I also need to see tangible savings, and like most of the CFOs surveyed, I want to see those savings in the form of lower healthcare claim costs. Show me real ROI through actual healthcare claims reductions. Give me that and I’m one happy CFO.

- Gregg Waldon, CFO, RedBrick Health

One response to this post.

  1. There is no question the CFO needs to be in the loop, as $ is the bottom line to hospitals’ survival. However, ROIs will begin to be driven and dominated y clinical outcomes, and i have a problem with CFOs being in total charge of finances. CIOs and CMIOs need independence and backing from others in the C-suite to make decisions on technology tools which will ultimately decide the financial success of an institution in the future. Data will drive ICD-10, good IT will drive successful ACOs, and great wireless technologies tied to data-driven mHealth prescribing will decrease readmissions and improve outcomes. IT will be clinical data, not accounting data which will rule. ACOs and vertical care organizations will purchase drugs, devices and equipment directly, saving much money. The ld negotiations and GPOs will not be needed. The CFOs role will be an easier one, not harder.

    Reply

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