Few CFOs remain in their roles long enough to witness two decades of transformation in healthcare finance — but Garrick Stoldt is not your typical CFO.
Now in his 21st year as CFO of St. Peter’s Healthcare System in New Brunswick, N.J., Mr. Stoldt, who is also vice president of finance, has helped guide the organization through seismic changes in healthcare delivery, strategy and payer relations.
He recently joined “Becker’s CFO and Revenue Cycle Podcast” to discuss what’s kept him engaged, why the modern CFO must be as strategic as they are financial, and how his team is fighting back against aggressive payer denial tactics that threaten patient care and financial stability.
Editor’s note: Responses are lightly edited for length and clarity. Click here to listen to the full episode of the podcast.
Question: You’re now in your 21st year as CFO at St. Peter’s Healthcare System — a rare tenure in today’s healthcare landscape. What keeps you motivated and engaged?
Garrick Stoldt: Most CFOs rotate out after five years. So I’m kind of an anomaly from that standpoint. I’ve been blessed, both with a great senior team to work with, and my direct reports are all top-notch, so I don’t have to worry about the blocking and tackling of day-to-day operations. It gives me more latitude to spend time on strategy and working on advancements in the system — What do we want to be like in five years? How do we go about getting there? That’s what keeps me going. Not that the day-to-day operations aren’t important, and I don’t spend time with them, but I’ve got a great team of people that do their jobs extremely well. It makes my job a hell of a lot easier than it would be without that.
Q: Strategy is clearly a big part of your role, and something that really motivates you. When we look back maybe 10 or 15 years ago, the health system CFO role was traditionally seen as more of a number-cruncher. But is that strategic aspect becoming more pivotal for CFOs today?
GS: It’s absolutely critical, because almost every aspect of strategy has a financial component to it. So you need people as part of the strategy team to understand the financial ramifications of new ventures and new opportunities that are out there. And there’s always new opportunities out there. The question is: is it a good investment or not a good investment? We’ve been fortunate at St. Peter’s to make a lot of the right choices and avoid the choices that weren’t going to work out.
Q: How do you see the health system CFO role continuing to evolve in the coming years? With so much disruption, technological advancement and transformation happening in healthcare, it seems CFOs are moving beyond their traditional financial responsibilities.
GS: As much as we talk about the things that are fancy, like technology and AI and all of those things, it’s still some of the basic blocking and tackling. After COVID — sometime around 2022 — all of the major payers around the country stepped up their game dramatically on denying care and deferring care, and denying care after it’s rendered. And it has put a huge financial hit on the industry. It’s not local to certain markets — it’s around the country.
We’ve had to reengineer a good piece of our revenue cycle. We had it evaluated by outside experts, and basically, before 2022, they said we were humming on all aspects of revenue cycle. They didn’t see any area where we were deficient. And now, in the middle of 2022, we had to retool our organization to combat the egregious practices of payers. I know of some very sad stories of patients who were denied certain types of care that led to their death. That’s how egregious some of these practices are. And it’s not a one-payer type of thing — it’s across the board. We’re fighting denials every day.
We’ve improved where we are since 2022, but it’s still a battle and still requires us to retool ourselves on a regular basis to combat it. It’s like a tennis match. They hit over a new type of denial, and we have to create a new type of response to mitigate its impacts. So, even though we’re talking about all the new fancy stuff, sometimes the day-to-day blocking and tackling can’t be ignored — and you have to readdress it on a relatively quick basis.
Q: Prior authorizations and the alarming rise in denial rates are widespread pain points. As you’ve retooled your revenue cycle, are there one or two specific strategies that have proven effective in reducing denials and protecting financial performance on the commercial side?
GS: The two biggest impacts. First, we were blind to how many days a patient is in the hospital when determining if we think they were clinically appropriate to be an inpatient or not. We had a lot of two-day stays, which payers were automatically denying, saying it wasn’t inpatient because it was just a two-day stay — even though there’s no rule that says it can’t be. We basically gave up and said, ‘Okay, if it’s a two-day stay or less, we’re going to bill it as observation instead of inpatient.’ That significantly dropped denials.
The second was expanding our team of physician advisors who actually spend their time attacking the payers for denials while patients are still in-house. We now do 100% peer-to-peer reviews and we have a team addressing every encounter so we don’t miss anything. Because it’s somewhat specialized, we still bring in our experts. For instance, if we have a neonate in our NICU and we’re getting today’s stay denied, we use our neonatologists to fight the denial. It’s like a heavyweight against a lightweight.
Most payers use primary care doctors as their medical directors making clinical determinations on inpatient status. But when you have a neonatologist — with their breadth of detail — they can run circles around an internal medicine doctor. We almost always get those overturned because of the clinical expertise brought to the table. We do the same thing in our pediatric intensive care unit, and with high-risk moms using our maternal-fetal medicine doctors, in addition to our core denial management team. Using specialists in these cases usually gets the denial overturned well over 90% of the time — because it’s a specialist against a primary care doctor. Nothing against primary care doctors — they’re very good — but they don’t have the subspecialty expertise.
