‘It’s a big ship to turn, but if you don’t have the attitude in place, you’ll never change’

HHS Secretary Alex Azar in early March challenged the industry to move quickly to become more transparent about pricing. And if it doesn’t happen, he said, the

Joseph Fifer, government has “plenty of levers to pull to make the change.” CEO of the Healthcare Financial Management Association, agrees that healthcare has been slow to adopt meaningful transparency policies, but he believes that is changing. Fifer, who took over the HFMA in 2012 after 11 years as vice president of hospital finance at Spectrum Health in Grand Rapids, Mich., says industry leaders are starting to do a better job of listening to consumers. Fifer recently met with the Modern Healthcare editorial team to talk price transparency, patient-friendly billing and other topics. The following is an edited transcript.

Modern Healthcare:

What’s the biggest change you are seeing in the CFO’s role?

Joseph Fifer: All the CFOs I talk to are absolutely right in the middle of strategic development of their organizations.

Sometimes we talk to our CFO members about things that are core to what the HFMA does, like revenue cycle or just pure finance issues or accounting standards, and they’re not all that tuned in because they’re focused so much on the strategic direction of their organizations.

So that has all kinds of implications for a CFO’s role today. And I think that’s going to continue.

MH:

How much are you working with members on the issue of transparency?

Fifer: We continue down this path of price transparency and patient financial communications, which we started back in the mid2000s. We started talking about price transparency before it was cool. We had a consumerism report out in 2006; we had a report on patient-friendly billing and on pricing. It really started to call into question how organizations set their charges.

A couple of years ago, we had our price transparency report and we pulled together a coalition of organizations, including America’s Health Insurance Plans and the American Hospital Association.

With the announcements from the current administration about transparency being a focus, our eyes and ears are wide open, and if there’s a way

for us to participate in the dialogue about these topics, I don’t think there’s anybody more expert in the country than we are.

MH:

Has the industry gone about transparency in the wrong way? Do we really know what a consumer thinks is transparency and what they want versus having to be an industry-led conversation?

Fifer: I’d like to answer that with a story about what we did with our price transparency coalition. We pulled together some large health plans, we had some large health systems, we had other associations. But we also had a patient for part of the time. It was a woman who was in New York and there was a series of articles in the New York Times about her. She was between jobs, she didn’t have insurance, this was before the Affordable Care Act and she was pregnant. She was looking for price and quality information about where to deliver a baby. And of course the article was not very complimentary about her success in finding that information, so there was a series of articles describing that experience.

She was an attorney by background, not a healthcare attorney, but obviously understood complex concepts and was used to studying, but not an expert in healthcare. We’d be talking about all these things and every once in a while she would raise her hand and say, “I don’t know what you guys are all talking about, but here’s what I was interested in finding out when I was doing this.” And it grounded us in a nanosecond. It took us right back to the roots of what we needed to do.

So that’s a long example, but it’s so important for organizations to do that, whether it’s through a formal design thinking process or just paying attention to the consumer’s needs. I am seeing more and more of that but it was a slow uptake.

MH: Given that there seems to be so much disparity from state to state and even health system to health system, do you think there needs to be more of a federal policy that sort of standardizes the information that everyone provides?

Fifer: We are politically agnostic. We don’t put together guidance to defend against legislation; we don’t put together guidance to promote legislation. We put a guidance together that says, “This is how it should work.” And the idea is that organizations can rally around that.

If there is going to be legislation or regulation, there’s a blueprint that folks could use. It really is hard to come up with federal laws or regulations that work really well in such a diverse industry across 50 states.

MH: Since the HHS secretary didn’t offer any specifics, does that afford you an opportunity to go in early and say, “Here are some ideas of what we think we could do,” or are you still going to take a step back and wait until they propose something?

Fifer: Maybe something in between. We continue to make it pretty clear that we’re available for anybody who wants to talk about these issues. We have a body of work that we think applies.

I don’t mean it to sound passive, but we just don’t have the infrastructure to really engage in that kind of a campaign, so we’re not going to do that.

MH: The industry still struggles greatly with consolidated, patient-friendly billing. What’s it going to take to get to a point where the majority of the bills are something that the regular consumer can understand?

Fifer: There’s some inherent structural complexity in our industry that other industries don’t have. When you buy a car, you’re buying something that many people may not understand. I don’t understand the inside of a car. But when you buy a car, you’re not dealing with all this fragmentation.

Healthcare has all this fragmentation that makes the environment much more complex than any other industry.

That said, we could do a lot better, but if I’d had this question two years ago, I probably would have given you a pretty discouraging answer, because I didn’t think that we were moving fast enough as an industry.

Over the past year to two years, I have sensed a much higher awareness of really listening to consumers and developing tools that will make it easier for them. I’m encouraged by that.

MH: In terms of the costcutting question, what do you think of what Amazon, JPMorgan Chase and Berkshire Hathaway are doing?

Fifer: So many times, somebody from outside the industry thinks there’s a simple solution to something, and there’s not. This is a very complex industry, and every single thing you do has multiple influences and multiple implications.

But it sounds to me like they’re going into it knowing that this is not a simple thing and that they can’t just wave a magic wand and fix it.

The question will be, are they willing, as employers, to make fundamental changes in their benefit plan structures to change the direction of their healthcare spend? And I’m sure that’s what they’re trying to figure out. So many times we want to change part of our industry, but don’t recognize just how fragmented it is.

We’ve all contributed to get us to this point. It’s silly to think that one or two of these segments, if they just make a change, will fix it.

MH: What about the aggressive moves by CVS Health, Aetna, Optum and Walgreens?

Fifer: I’m watching those just as much as I am the Amazon-Chase-Berkshire news. Those organizations have a different set of data that they’re going to be able to mine and do something different with and I think they’re each fascinating. The Aetna and CVS deal is particularly fascinating to see what that will do on the consumer end.

There’s a movement toward doing a better job of paying attention to the consumer and that’s what is driving this sentiment. It’s a big ship to turn, but if you don’t have the attitude in place, you’ll never change. And that’s the optimistic part that I’m seeing now. I’m seeing a different attitude about it.

I’ve been a critic of our industry because it starts with attitude.

“So many times, somebody from outside the industry thinks there’s a simple solution to something, and there’s not.”

MH: What are your thoughts about centralized versus decentralized boards and what that does for fiduciary responsibility?

Fifer: Two things. If we’re going to become more efficient, we need an ability to make decisions in a more centralized way. Obviously with any model, there’s a right way to do it and a wrong way.

The other point is, we need to come up with different language than saying, “We’re going to close the hospital.”

If you think about a small rural hospital, rarely would somebody say that we’re going to close this hospital and not have any services in the community at all. I think it’s a redefinition of what it is to be a hospital in those communities. And I’m not just playing on words here.

I’m not just trying to camouflage what’s really happening in these communities. Using current technology, there’s a different level of services than just having an inpatient hospital.

Some parts of the country are doing this really well, like Alaska and the upper Midwest states, where they’re using telemedicine and other technology to deliver services differently in those remote areas.