Julie Lautt: Success in healthcare finance leadership is about setting ambitious goals

At some time in their working lives, finance leaders may have the good fortune to play an integral role in setting ambitious goals for their organizations, while leading the team charged with achieving those goals.

That describes the experience of Julie Lautt, CFO at Avera Health in Sioux Falls, South Dakota, a regional health system comprising 315 locations in 100 communities across the Upper Midwest. Following a 30-year career in healthcare, Lautt marked her 25-year anniversary with Avera in July. During her first five years, she was a CPA with Coopers & Lybrand (now PwC).

The secret to her success?

“The workplace has to be a place where you enjoy being around other people, having fun with it and creating an environment of learning and growth opportunities,” Lautt said.

She has practiced what she preaches at Avera, moving up from controller to CFO over her first 17 years at Avera McKennan, the health system’s tertiary facility, before moving on as the vice president of operational finance, within the newly formed corporate finance reorganization for three years, and becoming CFO of the entire system almost five years ago.

Overcoming challenges

Along the way, Lautt has seen the Avera system’s development amid the vast and disruptive changes in healthcare finance policies, practices and procedures brought about by forces such as the 2010 Affordable Care Act and, of course, the COVID-19 pandemic.

As Lautt has moved through her career, she has encountered several challenges to healthcare finance that are ongoing and persistent.

“One of those overriding challenges is a lack of understanding by the public of how healthcare finance works,” she said, noting that even knowledgeable policymakers can underestimate the importance of policies or programs, like site-neutral payments or 340B programs.

Lautt also alluded to the challenges posed by price transparency requirements.

”While the intent and purpose of the new price transparency rule is appreciated, the reality is that complying is difficult,” she said. “It is just not easy to say, definitively, what a service will be — or what the patient will need to pay — ahead of time when the entire system is built on a very complex infrastructure that has not been aligned with a single price or payment.”

Need for a team approach

Lautt is a strong believer in teams, and she emphasizes this belief in her day-to-day operations. As her teams interact with the other clinical and operating teams, she tries to ensure that all voices are heard. But she always advocates for strong financial outcomes in addition to protecting the organization’s mission.

She has a strong reason for her persistence.

“No one pays as much attention to the balance sheet as the CFO,” she said. “We all need strong balance sheets, and we need to make a concerted effort to maintain this in order to support all of our teams during times of challenges. This helps create debt capacity so that when we have the next growth and/or opportunity idea, we can provide the teams with the ability to move those initiatives forward. It also ensures that we can fully support our mission, which is why we are here.”

When asked if there were just one thing she could change in healthcare finance, she said it would be to “reduce the administrative burden and complexity of the charging and billing system, which does not align with the price transparency and value-based models that are touted as being the industry’s future.”

Cost-effective-health

Lautt believes innovation is key to promoting cost-effectiveness in healthcare.

“Here at Avera, we strongly support innovation,” she said. “Particularly, as a rural provider, we embrace new ways of doing things. So we have invested heavily in virtual technology and telemedicine solutions to keep care local for patients while allowing specialists to be in different locations to support that care. So far, it has been a winning strategy.”

Favorite HFMA memory

Lautt said that, as a former president of the South Dakota HFMA chapter, she enjoyed HFMA’s regional presidents’ meetings and national HFMA Leadership Training Conferences where she was able to meet others who also were contending with similar challenges.

“It was exciting to trade stories and learn about other ways of doing some of the same things I was doing,” she said. ”It was eye-opening and a lot of fun.” 

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5 leadership tips from Julie Lautt

Julie Lautt offered the following recommendations based on her years of experience.

1 Check in on your commitment to the mission. Always make sure that your decision-making is consistent and aligned with the mission and values.

2 Develop and strongly support your finance teams. Surround yourself with people who share the same values with the ability to move the organization’s mission forward. Allow for development opportunities while coaching them, and be willing to let them go so they can thrive. Only with a good, strong, committed team can you achieve the set goals.

3 Partner with your operational teams. CFOs should build a structure and system that supports operations in a way that creates alignment to support the mission. In working to support leaders across the organization who are charged with caring for patients, your goal should be to create an environment of ideas and to provide people with tools and skill sets they need to be able to do their jobs.

 4 Ask questions and be inquisitive. Create an environment of mutual understanding. It is important to let the teams know, in context, what you are thinking so they understand why decisions are being made. I like to do this with stories. Putting the numbers into stories for non-financial leaders, in particular, helps convey the reasoning behind the decisions.

5 Show appreciation for all roles and perspectives. Healthy debate is important and fosters a degree of respect between parties. Seek to understand the other person’s role and why they hold their opinions, based on what they are motivated to support and protect. Make sure all voices are heard so all viewpoints will be considered when decisions are made.