Burlington, Mass.-based Tufts Medicine says it is on the rebound after facing significant financial challenges over the past few years.
“When I started, we were on a $300 million loss run rate,” Andrew DeVoe, executive vice president and CFO of Tufts Medicine, said during a Becker’s CFO+Revenue Cycle Podcast episode. “The good news is, in April, we actually turned a profit. It’s [been] about 14 months, and it was a heavy lift, but we have turned the corner, and we’re starting to rebuild the balance sheet.”
With 38 years of healthcare under his belt, Mr. DeVoe has been with Tufts since February 2024. Mr. DeVoe said the system’s “secret sauce” to a turnaround comes down to five actions, including reducing contract labor. Through centralizing benchmarking, Tufts also lowered its full-time equivalent count by almost 1,000.
“We fixed revenue cycle,” he said. “We had a … [few] of our departments that probably a third of the procedures were not even getting preauthorization. We fine tuned Epic so we could make sure that we were maximizing. Our collections per [relative value unit] before we started down this journey were $68 per RVU. Today it’s right at $84 per RVU. We’ve seen a pretty substantial lift. On the [hospital provider] side, it’s almost $100 million of improvement.”
Cost control and ensuring payment for services delivered have been essential themes in the health system’s restructuring.
“[Collecting] the revenue for the services that you deliver — very, very important,” Mr. DeVoe said.
For other health system leaders looking to improve finances at their organization, Mr. DeVoe said that speed matters when executing turnaround strategies and advocated for expert outside help when needed. He also said that when used well, consultants can help accelerate progress.
“There’s no shame in asking for help, especially if you can get the consultants to work on a contingency deal,” he said. “That’s exactly what we did at Tufts, and we’ve done it in many other places I’ve worked.”
Mr. DeVoe said that with profitability returning ahead of schedule, Tufts next steps include improving throughput through reducing length of stay, transforming care delivery and growing key clinical programs.
“We’ve got to consistently be profitable,” he said. “We’ve got to rebuild the balance sheet. We’re going to do that through hopefully a little bit of a shift in our payer mix. We’re going to have to expand our ambulatory setting. I think that’s where the future of healthcare is.”
