COVER STORY
February 2025
COVER STORY
March 2025
Nurse Leaders Are Losing the Narrative. Here’s How to Take It Back.
COVER STORY
February 2025
The payer-provider war is entering a new phase, and the financial fallout is devastating. CFOs are no longer just balancing budgets—they are the last line of defense against aggressive payer tactics. Here’s how they can leverage their unique position to reshape the fight.
COVER STORY
March 2025
AI, Lawsuits, and Power Plays. Why the Payer-Provider War Just Got More Dangerous for Healthcare CFOs.
The payer-provider war is entering a new phase, and the financial fallout is devastating. CFOs are no longer just balancing budgets—they are the last line of defense against aggressive payer tactics. Here’s how they can leverage their unique position to reshape the fight.
COVER STORY
January 2025
Physician Comp is Skyrocketing. Are Doctors Worth Their Price Tag?
In a landscape shaped by hashtags, algorithms, and viral posts, nurse leaders must decide: Will they let the narrative spiral, or can they adapt and take the reins?
TAKEAWAYS
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Healthcare CFOs must step up as strategic leaders to bridge the growing financial and operational divide between payers and providers.
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Health systems spend billions annually battling payers—CFOs have the power to turn financial losses into policy-driven reform.
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To drive real change, CFOs must move beyond financial strategy and into policymaking to advocate for fair reimbursement and operational sustainability.
TAKEAWAYS
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Healthcare CFOs must step up as strategic leaders to bridge the growing financial and operational divide between payers and providers.
-
Health systems spend billions annually battling payers—CFOs have the power to turn financial losses into policy-driven reform.
-
To drive real change, CFOs must move beyond financial strategy and into policymaking to advocate for fair reimbursement and operational sustainability.
Seventy percent. That’s how much payer-provider disputes have surged in just the last two years. Contract terminations, lawsuits, and drawn-out reimbursement battles have become the new normal, and hospitals are bleeding cash as a result.
Providers now spend nearly $20 billion annually on claim denials—half of it wasted on disputes that should never have happened. That’s $10 billion that could have gone toward patient care, medical innovation, or staff retention. Instead, it’s being siphoned away in an endless cycle of bureaucratic gridlock.
But this war is evolving. Payers are using AI-driven denials to reject claims at unprecedented rates. Legal battles over reimbursement are intensifying. Patients, caught in the crossfire, are angrier than ever. And yet, policymakers remain largely disconnected from the financial devastation unraveling in hospitals across the country.
If this battle remains an “I win, you lose” game, providers will continue losing billions, patients will suffer, and health systems will collapse under the weight of financial instability. The system is unsustainable—but it’s not unfixable.
CFOs are in a rare position to rewrite the rules of engagement. By standing at the intersection of finance, operations, and policy, they can wield hard data to expose payer tactics, drive regulatory changes, and force a shift in how contracts are negotiated. But to do that, they must step beyond the walls of their own health systems and enter the policy arena.
The payer-provider war is entering a new phase, and the financial fallout is devastating. CFOs are no longer just balancing budgets—they are the last line of defense against aggressive payer tactics.
THE STATE OF THE INDUSTRY
Contention
Providers have been fed up with payer behavior for decades; many have suffered financial turmoil from payer tactics, smearing contention across the picture of healthcare for everyone involved.
About 84% of health system CFOs cite lower reimbursement rates from payers as the top cause of low operating margins, according to a study published by the Healthcare Financial Management Association (HFMA).
Among HFMA survey respondents, 75% have also added more FTEs to handle insurance denials, and 63% have added staff to follow up on accounts receivable, both of which eat into a health system’s budget just to keep up with payers.
84%
of health system CFOs cite lower reimbursement rates from payers as the top cause of low operating margins.
Source: Healthcare Financial Management Association (HFMA)
Over the last few years some components of this dynamic between payers and providers have shifted, but arguably, not enough. There have been some wins, like increased transparency laws and modernized care models, but there have also been some losses, — and lawsuits — like payers using AI to inappropriately deny claims, fanning the flames of these disputes.
Even as recent as this month, health systems are opting out of settlements and choosing to fight back against payers with legal action. Dozens of health systems are currently suing Blue Cross Blue Shield for paying healthcare providers, “far less than they would have been paid in a competitive market.”
Mayo Clinic is also currently suing Sanford Health Plan over $700K in unpaid medical bills for a patient that was treated over two years ago. Mayo said is not seeking payment from the patient.
It’s instances like these that bring to the surface the strife between payers and providers, and patients that suffer.
Rick Gundling
Senior Vice President for Content and Professional Practice at HFMA and a former CFO
Resentful Consumer Outcry
The murder of United HealthCare CEO Brian Thompson shone an uncomfortable, blinding light on the contention within healthcare; not between payers and providers—between consumers and the modern healthcare system.
The online backlash after Thompson’s murder was nothing to shrug off, but in many ways, that’s exactly what happened. Consumers used the opportunity to fire back over the struggles of obtaining affordable healthcare through today’s insurers, painting a stark silhouette of spite against a horrific tragedy.
The harsh, inappropriate backlash from consumers took over the narrative for a brief second, but despite its widespread intensity, despite the decades of patients’ rage that led to this horrific outcome, it didn’t spark any significant change to healthcare or healthcare policies, it only brought about tension. Under this constant tension, cracks form, and systems break down.
“Though an unjustifiable action, we must recognize that there is a lot of friction that a lot of people, both payers and providers, know is there,” said Rick Gundling, Senior Vice President for Content and Professional Practice at HFMA and a former CFO.
This incident was tragic and will always be tough to face. But the industry shouldn’t let the discomfort of the situation muddy the waters of the underlying sentiment: many people have died because of denied care.
“It makes no sense to me that there is no true system that captures physical harm to enrollees related to denied or delayed prior authorizations,” says Kurt Barwis, CEO of Bristol Hospital, registered lobbyist in Connecticut, and former governor of the American College of Healthcare Executives. “Healthcare is supposed to be evidenced based/do no harm … yet the use of prior authorizations gets a complete and total pass?”
According to a report by the Kaiser Family foundation, 19% of in-network claims and 37% of out-of-network claims were denied in 2023, for a combined average of 20% of all claims. All of this is not to say that payers undoubtedly carry all the blame, but rather that the American healthcare system has failed many, many people when they needed it most.
TRIED AND (UN)TRUE
The strategies that health systems have used to try to level with payers often haven’t ignited much change. Little wins here and there are important, but baby steps can only take you so far.
Regardless of tactics, it is mission-critical to think of payers as partners and not adversaries. Stepping into a contract negotiation and preparing to steamroll your partner in an attempt to achieve a resolution is not a good strategy. This method is a “short term victory that results in long term pain,” says Evan Zaslow, Vice President of Payer Strategies at Moffitt Cancer Center.
That being said, two things are certain: payers are not always as transparent as they should be, and new technology, specifically AI, has muddied the waters.
Evan Zaslow
Vice President of Payer Strategies at Moffitt Cancer Center
“Unless there are regulatory or legal changes to simplify the administrative burden of prior authorizations and claims adjudication, it is possible we could end up in a future state of a battle of the bots and AI-based standoffs between payers and the providers, which overcomplicates and strains relationships.”
—Evan Zaslow, Vice President of Payer Strategies at Moffitt Cancer Center.
As both payers and providers have stepped up their use of AI since its advent, data has simultaneously become both more simplified and more complicated than ever. AI takes away administrative burden, tediousness, and wasted time, but it also raises questions about governance, clinician input, and even accuracy.
Payers jumped on AI with haste, and then providers followed. But when AI became tied up in prior authorizations, claims and denials, transparency became translucency. It may be on the naive side to assume that new technology is going to prompt needed reform.
“The practice of payers leveraging AI in prior authorizations and claims processing is driving providers to implement their own AI-driven strategies to keep pace,” says Zaslow. “Unless there are regulatory or legal changes to simplify the administrative burden of prior authorizations and claims adjudication, it is possible we could end up in a future state of a battle of the bots and AI-based standoffs between payers and the providers, which overcomplicates and strains relationships.”
What has been the biggest push to get payers to be more transparent? You guessed it, policy. The Transparency of Coverage rule is a big step in the right direction, but as CFOs know, it’s still far from perfect. Change grows from persistence.
A NEW WAY TO WIN THE WAR?
Providers continue to face monumental struggles with payers, and no amount of community programs, saved labor costs, or new technology is going to make up for the onslaught of denials and tactics that place unequal risk on the health system and all its staff. When negotiating leads to no-where, a nuanced strategy must emerge, and CFOs have it in their back pocket.
CFOs must take the leap in shaping healthcare policy. If finance leaders can make the mindset shift from passive observers to active participants in policy discussions, opportunities will open up.
James Rohrbaugh
Executive Vice President and Chief Financial Officer at Northern Light Health
Looking Beyond Delegation
Government affairs teams are an excellent resource, but are they strong enough conduits to drive real change? For many smaller and rural health systems, a government affairs team doesn’t even exist. Some finance leaders seem on board with the concept of CFOs finding their place in policy discussions, but others seem hesitant. Hesitant not only towards the concept of opening the door for political discussions and their interwoven complexity with the nation’s healthcare, but hesitant because it’s simply not in their job description.
“Not a day goes by that I’m not communicating with our government affairs team.”
—James Rohrbaugh, EVP and CFO at Northern Light Health
“The issues, especially involving reimbursement and new programs like the AHEAD CMMI global budget model, require extensive financial modeling,” says Barwis. “You cannot assume a government affairs person is going to be able to convey the right information or that the message will be received. Even with a full government affairs function, the finance team needs to be engaged.”
Even further than finance and healthcare operations knowledge, CFOs are in a position to foster trust with their policymakers, which is something that is established over time through engagement and showing up, says Barwis.
“Legislators want to know that the senior team will work with them and build relationships with them,” Barwis says. “[It] doesn’t happen if all you do is divert to your governmental affairs team. I’m not saying you shouldn’t have one, there are clearly issues and advocacy they can do great with, but they need to have a CFO that is willing to engage and be present.”
In relation to lawmakers, CFOs are in a prime position to bring data-driven insights by using financial metrics to show how specific policies could impact their hospitals' financial health and, by extension, the communities they serve. This concept, coming directly from a CFO, places a different type of urgency on these issues facing the industry.
Upcoming finance leaders may need to play the role of the lobbyist more so than their predecessors did. The policy makers do not have healthcare knowledge, they have policy and regulation knowledge. CFOs on the other hand, have a bit of both, mixing finance and business expertise with a close familiarity of clinical frameworks. This is why CFOs, and even CEOs, need to ensure they are fighting for their health system in every way they can, including taking charge in these discussions.
Payer-Provider Relations Have Worsened
SOURCE: HFMA surevey in August of 102 hospitals CFOs, with 102 responding to this questions.
The Benefits of Persistence
By seizing their seat at the policy table, CFOs can find more than they probably thought possible in these collaborations. Firstly, CFOs can educate policy makers on specific challenges by using real data. Who doesn’t want a local senator that is well-versed on your organization's particular challenges? What’s more, this dynamic works both ways, CFOs can even learn a thing or two from their legislators.
“You may even learn about something that’s negatively impacting your organization that’s not even on your radar screen,” says Barwis. “All of this can enhance your success in resolving payer disputes, improving payer negotiations, and improving the financial outlook for your organization.”
When more CFOs approach legislators, payers will notice. CFOs can also look to payer lobbyists for help navigating unfamiliar terrain.
“I would say payers take notice and it has an impact when you are dealing with a large denial or dispute,” says Barwis. “In addition, knowing a payer lobbyist personally because you are engaged and advocating at the Capitol on key bills, can pay dividends. More than once I’ve gotten a denial issue resolved by simply asking a payer lobbyist to help me. They want good relations and trust when they face regulators.”
Actionable Affairs: A CFO Guide
The intention here is not for CFOs to waltz into a politician's office and complain about their payers’ problems. Pushing back in policy discussions is a process that takes a disciplined strategy balanced with an open mind.
“It is really a question of what’s impacting your organization or could impact you the most that drives engagement,” says Barwis.
Find Your In
Start by doing your research. Locate who your local legislators are and seek them out. Research their stances on past issues to reinforce your knowledge on policy nuances as best you can. If you’re unsure about who to immediately speak to, call your senators’ office, ask.
Don’t let political dynamics intimidate you. Legislators are public servants, their job exists to serve the community around them, something CFOs can keep in mind as they approach these discussions.
Present Your Data
Present to legislators what is dragging your health system down and why, whatever it may be. Leverage your financial data and expertise to present clear and concise information on the impact of proposed legislation on patient care, cost structures, and healthcare access. Collect denial rates, prior authorization wait times, document any harm caused to your organization's patients and staff. All of this will show legislators what health systems are truly struggling with, and this strategy goes beyond payer problems.
At Bristol Hospital, for example, Barwis says lobbying and promoting legislation related to “Hospitals Against Violence” was not only important and incredibly engaging to its frontline staff, it also “succeeded in improving the laws in Connecticut in just one session of our general assembly.”
Join Your Advocates
Joining advocacy groups is another way for CFOs to fight back. Join your fellow healthcare advocates and discuss strategies, pain points and paths for reform. Network with payer lobbyists and take the time to think about what you would like to see accomplished in the regulatory space. Advocacy groups are an important strategy support system when roadblocks pop up.
In today’s healthcare landscape the stakes are too high for CFOs not to be participating in these discussions; their perspective and deep knowledge of healthcare finance is needed to broaden and advance the scope of healthcare for the entire country.
“You can make incredible change, and not just for your organization,” Barwis says.
Marie DeFreitas, CFO Editor, HealthLeaders
Kurt Barwis
CEO of Bristol Hospital