How to Talk to and Work Successfully With My Finance Partner
It has been several weeks since I have had an opportunity to share leadership topics. As I pondered my next topic, I realized this one is particularly important to nursing leaders because we are not taught financial management in nursing school. Its’ importance became even more apparent to me as I talked to a very good friend who has healthcare finance engraved in her brain… so much so that a stroke has not stopped her drive to want to enable healthcare leaders to understand the financial impact of their business units. While this can be a bit of a complicated subject, I hope you will keep it as a reference for current and future use.
So, I know many of you are reading this saying (under your breath…if you are anything like me), “my unit takes care of patients. This is not a ‘business’ unit. We care for the sickest of the sick, and those bean counters can worry about that financial stuff!”
I totally understand your perspective. For all of my years of my bedside nursing career and even my early years as a leader, I made many of the same comments. I was there to lead those who took care of patients and didn’t have time for that other “foolishness.” It wasn’t long, however, until I realized not understanding the “foolishness” meant I couldn’t get the needed supplies, effectively staff my unit, explain a valid reason to increase staffing, nor build a plan for expanding services. That financial “stuff” needed to be a part of my knowledge base, AND I needed to approach the finance people as my allies and colleagues instead of treating them like adversaries.
So another question you may be thinking is, “which part of the ‘financial stuff’ on my unit is important? I’m not sure you will like the answer, but here it is. All of it. Charge capture, staff scheduling, overtime, etc.
Let’s talk about how to build that collegial relationship.
Relationship with the finance partner:
Get to know your financial partner. In some organizations it is a director, a CFO, or it may be a totally different title. Be honest about your gap in understanding. Most want to help you to be successful. Become friendly with them. Many of them LOVE to teach, AND you can help them understand the nuances of your unit.
Don’t wait for them to come to you —
Set up a monthly meeting to meet with them, ask what documents you should bring to the meeting.
Whatever they suggest, come prepared with your financial documents, your laptop, and a notepad.
Be respectful of their time by arriving on time and not missing the meeting. They are more than willing to help you if YOU do your homework and follow-through.
After the first meeting, be sure you’ve agreed to the regular monthly date to ensure the two of you are on the same page.
Learn the language of your unit. I was told by a mentor VP that I couldn’t keep saying my patients were “sicker.” I needed to use objective measures. The unit of measure for the ED has been either visits or RVUs. Visits are raw numbers; RVUs showed acuity. I needed to learn to speak in both languages.
Know the person who manages your departments charge capture. Periodically review their work. It will drive your unit of service which will impact productivity.
Know who is ordering your supplies and always have a backup person.
While it may seem tedious, be aware that your charges and your supply ordering feeds into financial ratios such as supplies or revenue per unit of service
Which leads me to staffing.
Pay attention to the person who does the staffing schedule. Sometimes we have someone “do the schedule” without giving them real training OR (my pet peeve) not having managerial oversight of the schedule before it is released. It is a manager’s responsibility to avoid innocently scheduled overtime vs traditional true overtime.
Always have a backup scheduler. Having your primary scheduler go out on unexpected leave is terrifying when it’s a week before the schedule is supposed to be posted.
Learn how to show the connection between your income statement and your productivity statements. I realize the income statement is provided monthly and productivity is bi-weekly according to pay periods. But knowing the connection between the two will help you to be successful.
Learn the formulas behind the scenes — like how to calculate an FTE, non-productive time, % of overtime, etc.
Maintain a position control so you know which positions in your unit are vacant, which are filled, and who took what position.
Know that your finance partner is not trying to make your job harder, but YOU have to be able to understand the numbers then tell the “story behind the numbers.” One of my FAVORITE budget colleagues used to say, “there’s the numbers and then there’s the story behind the numbers.” It was my job to be able to explain that “story.” By the way, he was a favorite of every nursing leader in that hospital. I affectionately referred to him as our “budget dude!”
Partner with a successful leader who is already good at finances. I cried through my ENTIRE first budget process because of not even knowing what an FTE, budget neutral, zero budget, or FY was. There’s always one, and potentially more, in your organization willing to help you succeed. There are several names that pop into my head even today: Darla Starks, Deb Malick, Judy Miller, and the list goes on.
Don’t EVER lie to your finance partner. They will NEVER trust you again and can end up being your worse nightmare. If you have made an error, just tell the truth. It’s easier to find an error early than it is for someone to stumble on it later. I once overspent by over $200,000 with a new program. While I wanted to blame everyone but myself, coming clean in front of the CFO and everyone at the table bought me more credibility and grace than anything else.
Actively participate in your budget process. There are few things that frustrate a finance colleague more than the words “I didn’t build that budget, so I don’t know how I am expected to live with it. Be FULLY accountable for your unit. Long ago, A CEO encouraged all of the leaders in the hospital to be “CEO’s of our own departments.”
Once your new fiscal year starts, check your real budget against what you requested. I cannot tell you the number of times I thought I had one amount in one of my sub accounts (i.e. staff education) only to find out it had been decreased during the budget review process. The excuse “I didn’t know” will NOT be a good answer. In the words of my father, go “line by line and precept by precept” to see if your requests align with your actual budget.
During the budget process, ask only for what you need instead of asking for the moon. Also, document your justification. It’s a glaring red flag when, for example, you budgeted (and spent) $4th on staff education last year, but you are afraid it will be cut this year so you ask for $6-8th with no change in staffing, increase in your services, or no clear explanation. Let’s say you need a certification for your nurses. Document the number of nurses times the amount for the certification period. To really show you are being fiscally responsible, consider stretching out the certification over several years.
And finally, once you have become financially savvy on your unit, be “the mentor you needed when you started.” Don’t hold onto your knowledge. Share and be a mentor to other new leaders.
These 12 steps may sound overwhelming at first but take them one at a time. After more than 20 years of health care leadership, I know these tips can help to set you up for success.
As always, please do not hesitate to contact me if there is anything, I can do to help you in your leadership journey.
