Benefits of partnership: Lessons from a health system COO
A growing health system contains costs through outsourcing
An interview with Pamela Stoyanoff, Methodist Health System, published by HFMA.
In this interview, Pamela Stoyanoff, executive vice president and COO, Methodist Health System, discusses her organization’s decision to outsource some facilities management services.
On her health system’s recent growth. Methodist Health System is a 10-hospital system — with an eleventh currently under construction — serving Texas’ Dallas-Fort Worth area. During the past decade, the health system has also expanded its reach to include more than 25 Family Health Centers, Urgent Care centers, telehealth services, and concierge services, with almost $2 billion in annual net revenue.
In October, Methodist Health System plans to break ground on a new 46-bed facility in the southern part of their market. The system also has purchased a hospital out of bankruptcy and opened several urgent care centers across the area.
This continued expansion is helping the organization remain competitive in a market dominated by even larger players. “We’ll never be the biggest, but we have to keep growing to be relevant, visible, and accessible in our marketplace,” Stoyanoff says.
On the decision to partner with a vendor. Methodist Health System includes new as well as older facilities like their flagship hospital. For years, many of these older campuses struggled to stay on top of facilities issues, such as new equipment technologies and automation. And because facilities were managed at the local level, leaders were unable to leverage economies of scale and standardize across the system. “We had too many vendors, extremely limited automation, and different levels of expertise among facilities management leaders,” Stoyanoff says. This created opportunities for cost savings in real estate and facilities, which represents a material percent of the health system’s operating revenue.
Rather than creating a corporate function to oversee potential cost containment and operational improvement initiatives, leaders at Methodist Health System decided to partner with a facilities management vendor on five of their campuses.
What results did Methodist achieve?