Being a chief financial officer for even a small community hospital is a challenging job. But how does a seasoned healthcare finance executive wind up getting a job overseeing the dollars and cents at a large multi-hospital system, where the responsibilities are multiplied many-fold and the annual salary and bonus can break well into the seven figures?
I spoke about this topic at some length with Michael R. Raddatz, Jr., pictured above, a consultant with Witt/Kieffer, the healthcare executive recruitment firm.
Raddatz's first piece of advice for those who seek a system CFO position: Hope for the best, but don't necessarily expect it. Blame it on the wave of mergers and acquisitions among hospitals and healthcare systems.
“I am seeing less of those positions out there, given that there are fewer larger systems,” he said in an exclusive interview with FierceHealthFinance. “That makes them increasingly competitive.”
The most logical move to a system position is from a large hospital (400 or more beds). That makes sense; usually the revenues of a facility that size is in the high nine figures, if not above $1 billion a year. But again, that's not necessarily a hard and fast rule.
“More than the beds, it's the revenue and the complexity of the hospital,” Raddatz said. “There are a lot of 150-bed hospitals that are busier than a 300-bed hospital. Other ancillary aspects also matter, such as the amount of employed physicians.”
The educational requirements are fairly established: Either formal training as a certified public accountant or a master's of business administration.
Raddatz sees several employment paths toward becoming a system CFO. Among them:
Obtain a vice president of finance position within a system and work your way up
Promotion within a system to a regional VP of finance. That often means overseeing the finances at several hospitals at once--great experience for taking over an entire system at a later date. The key to promotion is often how much exposure to financial complexity--and autonomy--can be had in the current and prior role.
Make a move from a site leader at a hospital system to a larger standalone hospital. This maneuver has its risks, but you can often return to a system with wide breadth of experience.
Transition from the consulting sector--a move that can be made if you've done a lot of work with hospital systems, perhaps even filling in at a high level position
Obviously, none of the jobs at any level is easy.
“You're working in these highly matrixed systems, and whether you're CFO or a vice president, you have accountability for a lot,” Raddatz said. “There are a lot of balls up in the air; you're managing day-to-day operations, plus you're trying to build up a balance sheet.”
But despite the tough, often precarious road to a system CFO position, he said the role can be highly rewarding.
“You're serving as a strategic partner to the chief executive officer, and you have that visibility with the board of directors, all the while looking a strategic finance and mergers and acquisitions,” Raddatz said. “It's a great challenge to pursue.” -- Ron (@FierceHealth)