Hospital CFOs Say Growth Alone No Longer Boosts Margins
At a Becker's CEO + CFO Roundtable fireside chat, Cleveland Clinic CFO Dennis Laraway and Ochsner Health CFO Jim Molloy described shifting away from the traditional hospital growth playbook as labor and supply costs outpace reimbursement. Cleveland Clinic is targeting internal operating synergies, labor productivity measurement, and supply chain standardization to hit its "10 and 5" cash flow and operating margin goals, citing a 2.5% blended rate increase against 5-6% cost inflation. Ochsner, where government payers make up about 70% of its mix, has paused acquisitions to standardize operations across its 47 hospitals before pursuing further M&A. Both executives said volume growth no longer offsets inflationary and reimbursement pressures, pushing systems toward internally generated efficiency gains instead.