Four top business concerns for behavioral health CFOs in 2021
INSIGHT ARTICLE |
At a recent executive roundtable, CFOs of behavioral health and social services organizations shared what’s on their minds with 2021 on the horizon. Here’s what they had to say:
Unsurprisingly, the current pandemic was a key theme. A significant part of the CFOs’ discussion centered on various funding sources, including Paycheck Protection Program (PPP) loans and Provider Relief Funds (PRF). The CFOs discussed their significant apprehension regarding PRFs and their organizations’ ability to demonstrate need and eligibility in light of routinely changing criteria amid the uncertainty of final reporting and compliance requirements. These concerns were less with PPP loans, but the CFOs expressed uneasiness about ultimate forgiveness until actually achieved and its impact on their accounting and reporting.
Many CFOs’ organizations took measures during the pandemic to address technology needs for enabling a remote workforce, where possible. Alongside additional investment in technology, the roundtable participants acknowledged their significant investment in personal protective equipment to ensure their organizations’ ability to continue to serve clients while adhering to various guidelines and mandates. Several CFOs said they continued to provide services by leveraging a telehealth platform, too.
The CFOs expressed concerns for the future, however, including an expectation of significant changes to the manner in which their services are reimbursed, such as a greater shift to value-based care. They discussed technology changes and data analytics initiatives they are undertaking to address these changes. In addition, uncertainty regarding their ability to continue to leverage their virtual care platforms was a concern should the temporary lifting of certain regulatory requirements be revoked and related reimbursement rates revert to pre-COVID levels. One CFO indicated they were “getting hammered” on rates and pondered whether reimbursement challenges could be a risk in the coming year.
The post-COVID outlook discussion also included thoughts on strategies to reduce costs and improve margins while attracting and maintaining a quality workforce. Their cost reduction strategies included affiliations with larger organizations to scale services and reduce administrative overhead, leveraging current systems and technology more efficiently and introducing automation where feasible, moving certain services away from on-site or in-facility to home-based and halting services deemed unsustainable.
Regarding workforce, the CFOs expressed significant concern related to their organizations’ difficulty finding and hiring necessary talent for their programs; some described it as nearly impossible. One strategy mentioned was international recruiting in areas where there is a high interest in working within that particular industry, offering the employee candidate the possibility of immigrating to the United States on a permanent basis.
The last significant topic of discussion focused on insurability across the industry. Recently, behavioral health organizations have been on the losing end of lawsuits and investigations related to abuse, neglect and cyberbreaches. Almost universally, the contracts or payor arrangements under which these organizations operate required significant insurance coverage for such risks. However, due to these latest events, costs to insure these risks are skyrocketing—and in certain instances, no longer offered. It remains to be seen what the long-term effect will be on this industry; the roundtable CFOs are exploring all options available. One CFO mentioned potential participation in a captive insurance structure.
At the macro level, the CFOs indicated these legal matters are requiring them to take a serious look at their risk management policies and procedures from the top down, particularly their governance, as the geographical spread of their operations makes it challenging to mitigate such serious infractions.