'Health and wealth': Inside MetroHealth's strategy to build financial stability

Amid the financial challenges facing hospitals and health systems, Cleveland-based MetroHealth is focused on its $1 billion transformation plan, community involvement and other initiatives designed to build stability, its CEO, Airica Steed, EdD, RN, told Becker's.

In 2022, MetroHealth posted a modest positive adjusted operating result of $18 million, or a 1 percent operating margin. The organization said a strong retail pharmacy program and a shared savings payment from one of its payers factored into the result. 

Overall, non-operating activity including investment losses of $44 million pushed MetroHealth to record an overall loss for the year of $29 million.

"Like most health systems across the country, we're not immune to the headwinds," Dr. Steed said. "We are experiencing the same dynamic as it relates to higher inflation [in the costs of goods and services]. But I think labor is the biggest pill to swallow on the expense side. So we're trying to find ways to be creative, much more cost effective and cost efficient, to really balance out and really offset those major hurdles."

One of the health system's efforts is a workforce strategy task force to review compensation, benefits and support services provided to employees. MetroHealth said the goal of the group is to ensure the organization is attracting, retaining and continuing to build a committed workforce. The health system is also working on its multifaceted transformation strategy, which it said includes driving operational efficiencies, optimizing revenue through revenue cycle improvements and targeted population health strategies, and enhancing profitable growth of core businesses.

For example, MetroHealth is introducing more licensed practical nurses into the forefront and balancing out the workload across the organization, Dr. Steed said. The health system has also been undergoing a $1 billion campus transformation plan over the last several years.

"Fortunately for us, we were very proactive to adapt to where the future of healthcare is going," Dr. Steed said. "All of our campuses have been redesigned for much more ambulatory facing-posture. We are driving a lot of continuous improvements to really make healthcare much more efficient."

She said the health system has also employed population health initiatives to reduce cost of care and reduce overburdening of emergency departments.

One byproduct of this and other transformation work is MetroHealth's vision of turning its 52-acre main campus into a "hospital in a park."

"We saw the 'hospital in the park' as a byproduct of our ongoing campus transformation work," Dr. Steed said. "But it also speaks to what we're trying to do on the health equity side as well and being much more community-facing, really caring about the well-being of the population that we serve, creating a much more welcoming atmosphere and building up not only the health and wealth of our internal organization, but building up the health and wealth of our communities."

Dr. Steed told cleveland.com in a recent interview that the next step is to conduct due diligence on the health system's transformation plans to ensure plans are aligned with existing needs.

Dr. Steed also told the publication that she "need[s] to catch [her] breath a bit and catch up on all the plans," but that the hospital-in-a-park concept "is not on the back burner by any stretch of the imagination."

In November, MetroHealth opened its new Glick Center hospital as part of the campus transformation plan. 

Other parts of the campus transformation, such as a new, 700-space garage west of the Glick Center and the completion of the new $140 million Apex Building, are scheduled in upcoming phases, according to cleveland.com.

Dr. Steed said the Apex Building, a new outpatient building, is scheduled for completion in 2024. 

"The majority of our ambulatory programs are actually going to live under that structure," she explained. "And with that being said, that's going to set us into the next phase of our surrounding development in terms of the green space that we're developing. So it's [the transformation plan] going live in phases. We're very much on track with that development."

When it comes to financial stability, she focuses on engagement with staff rather than a top-down approach, Dr. Steed said.

Her approach includes hosting listening sessions and providing other ways for workers to offer input and suggestions.

"I've been steadfast about having not only conversations with our internal audience or all of our various employees, but I've actually started to develop community advisory councils and bring the community in to make some suggestions on how we repurpose our organization," she said. "How do we restructure some of our services or expand some of our services to make it much more prosperous for us all?"

Dr. Steed said she also focuses on revenue optimization and the question: "How do we essentially build up patient loyalty to a point where all of the services that we provide, we can benefit?"

"I don't think that we're going to fully rebound to the world, pre-COVID," she said. "We have to really build the plane and fly it at the same time. And we have to address the new norm head on. So, post-COVID reality is here, and it's here to stay. There are some silver linings in the post-COVID aftermath, where we've accelerated into adopting technology, you've accelerated into thinking differently about how we adjust to the workforce. But at the end of the day, healthcare is behind other industries. But now it's time for us to really catch up and catch our breath."

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