Gordon Edwards: Lessons learned from the CFO of a children’s hospital

Gordon Edwards, CFO of Akron Children’s Hospital, has a credo he lives by: “We improve the health of kids.” It’s a credo that reflects his belief that children’s hospitals are among the most rewarding places to work in healthcare.

“Children’s hospitals are just happier places, because everyone is dedicated to providing children with the opportunity to achieve their full potential,” he said.

Edwards was appointed as CFO of the hospital in October 2022, after having been the CFO for three adult health systems across the Pacific Northwest and Midwest for more than 13 years. He was drawn to Akron Children’s in for its mission, vision and promise.

An HFMA member since 1997, Edwards, FHFMA, MBA, CPA, has held a variety of other roles while performing his CFO role, including COO, CIO and health plan administrator. Thus, he brings a fully rounded perspective to his current role.

“One of the differences between an adult and a children’s hospital is the payment structure,” Edwards said. “There are essentially no Medicare payments, but Medicaid makes up over 50% of the gross revenues, creating a greater dependency on state budgets and financial challenges related to uncompensated costs. We also have a singular focus, kids, so prioritization of resources is about meeting the greatest needs of kids. Also, our patients don’t purchase insurance, schedule their appointments or pay the bills, so our strategic tactics are truly patient- and family-centered,” he said.

On overcoming inefficiencies

Edwards believes the U.S. healthcare system needs to become more efficient, particularly in the use of technology.

“There are too many steps in our processes, creating significant inefficiencies,” he said. “And the industry has not tackled technology well.”

He points to electronic health records (EHRs) as a prime example.

“EHRs have caused many institutions to add staff to leverage the technology’s functionality rather than reduce staff — an expected outcome in other industries when they improve technology,” Edwards said. “EHRs have traditionally placed more burden on our most expensive resources, our physicians. New technology, such as ambient listening, is showing some promise in achieving efficiencies for our physicians that we have been seeking.”

Edwards’ vision for the U.S. healthcare system

If he had the power to transform our nation’s healthcare system, Edwards said, he would institute a single-payer insurance market for everyone in the nation.

“This doesn’t necessarily mean that the government is the single payer,” he said. “Rather, it would involve individuals buying insurance with a defined set of benefits based on their own risk tolerance. There would be governmental and/or employer subsidies for premium support. The single-payer insurance market would standardize the administrative expectations, such as coverage authorization, across all insurance options.”

Edwards is concerned that healthcare organizations spend way too much money on trying to determine who is going to pay and how much they are going to pay, as well as on dealing with situations where payers try to avoid payment altogether.

“And our patients are caught in the middle of these processes, which harms their wellbeing at the very time we are trying to heal them,” he said. “Standardized insurance coverage and administrative processes would reduce the related administrative costs for all.”

Edwards added: “The current system does not need to be so complicated. Many employers self-fund their employee health insurance risk because their risk is better than the insured pool, making it cheaper. But self-funding limits or removes the ability for a community hospital to assume the insurance risk for self-funded patients and, as a result, reduces the opportunities to manage care differently across all populations. Many people may disagree with a single-payer insurance market, but the current system is unsustainable. We can do better!”

Additional words to live by

Edwards takes inspiration from these words spoken by Martin Luther King Jr.: “The time is always right to do what is right.”

“Healthcare finance and operations is hard,” he said. “Those who do it well will have purpose and commitment for the here and now, to maintain operations as well as make decisions today that will enable the organization to thrive in 25, 50 or 100 years from now.”