CINXE.COM

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Clinical Services</h4> <span class='dates iteration-flex-item'><span class='start'>January 19</span> – <span class='end'>31, 2025</span></span> <span class='dates iteration-flex-item'><span class='start'>January 25, 2026</span> – <span class='end'>February 6, 2026</span></span> <a href="https://www.hsph.harvard.edu/ecpe/programs/program-for-chairs-of-clinical-services/" class="related-program-learn-more">Learn More</a> </div> </div> <div id="related-articles"> <div class="section-title"> <h4>Related Articles</h4> </div> <div class="related-article"> <h4>The Unique Challenges – and Opportunities – Facing Leaders of Academic Health Centers During COVID-19</h4> <br> <a href="https://www.hsph.harvard.edu/ecpe/challenges-opportunities-facing-leaders-academic-health-centers-during-covid-19/" class="related-program-learn-more">Read More</a> </div> <div class="related-article"> <h4>From Physician to Physician Leader: Developing Your Skills for Success</h4> <br> <a href="https://www.hsph.harvard.edu/ecpe/physician-leader-skills-success/" class="related-program-learn-more">Read More</a> </div> <div class="related-article"> <h4>Leadership Development (Infographic)</h4> <br> <a href="https://www.hsph.harvard.edu/ecpe/leadership-development-infographic/" class="related-program-learn-more">Read More</a> </div> </div> </div> </div> <main id="main" class="site-main" role="main"> <article id="post-21210" class="post-21210 post type-post status-publish format-standard has-post-thumbnail hentry category-leadership-management tag-pccs audiences-academics audiences-clinicians audiences-executives"> <header class="entry-header"> <h1 class="entry-title">The Financial Pressures That Chairs of Clinical Departments Face—and How to Manage Them</h1> </header> <figure class="post-thumbnail "> <img width="2560" height="1707" src="https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-scaled.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="Doctors discussing finances" decoding="async" fetchpriority="high" srcset="https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-scaled.jpg 2560w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-300x200.jpg 300w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-1024x683.jpg 1024w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-150x100.jpg 150w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-768x512.jpg 768w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-1536x1024.jpg 1536w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-2048x1365.jpg 2048w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-450x300.jpg 450w, https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-500x333.jpg 500w" sizes="(max-width: 709px) 85vw, (max-width: 909px) 67vw, (max-width: 984px) 60vw, (max-width: 1362px) 62vw, 840px" data-attachment-id="21216" data-permalink="https://www.hsph.harvard.edu/ecpe/the-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them/doctors-discuss-patients-diagnosis-2/" data-orig-file="https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-scaled.jpg" data-orig-size="2560,1707" data-comments-opened="0" data-image-meta="{"aperture":"3.2","credit":"Getty Images","camera":"Canon EOS 5D Mark III","caption":"A group of diverse doctors gather in a hospital hallway to discuss a patient's medical diagnosis.","created_timestamp":"1439642281","copyright":"","focal_length":"115","iso":"800","shutter_speed":"0.008","title":"Doctors discuss patient's diagnosis","orientation":"1"}" data-image-title="Doctors discussing finances" data-image-description="" data-image-caption="" data-medium-file="https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-300x200.jpg" data-large-file="https://www.hsph.harvard.edu/ecpe/wp-content/uploads/sites/2020/2022/11/PCCSArticleiStock-1227588368-1024x683.jpg" /></figure> <div class="entry-content"> <p class="article-author">by Katherine J. Igoe</p> <div class="hsph-share-buttons hsph-bootstrap"><span class="hsph-share-btns-label">Share this:</span><a rel="external noreferrer nofollow" target="_blank" href="https://www.facebook.com/sharer/sharer.php?u=https%3A%2F%2Fwww.hsph.harvard.edu%2Fecpe%2Fthe-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them%2F" aria-label="Facebook button link" class="btn btn-light btn-sm btn-squared shadow-none mr-2 mb-2 hsph-share-button-facebook"><i class="fa fa-facebook" aria-hidden="true"></i>Facebook</a><a rel="external noreferrer nofollow" target="_blank" href="https://twitter.com/intent/tweet?url=https%3A%2F%2Fwww.hsph.harvard.edu%2Fecpe%2Fthe-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them%2F&text=The+Financial+Pressures+That+Chairs+of+Clinical+Departments+Face%E2%80%94and+How+to+Manage+Them" aria-label="Twitter button link" class="btn btn-light btn-sm btn-squared shadow-none mr-2 mb-2 hsph-share-button-twitter"><i class="fa fa-twitter" aria-hidden="true"></i>Twitter</a><a rel="external noreferrer nofollow" target="_blank" href="https://www.linkedin.com/shareArticle?mini=true&url=https%3A%2F%2Fwww.hsph.harvard.edu%2Fecpe%2Fthe-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them%2F&title=The+Financial+Pressures+That+Chairs+of+Clinical+Departments+Face%E2%80%94and+How+to+Manage+Them" aria-label="LinkedIn button link" class="btn btn-light btn-sm btn-squared shadow-none mr-2 mb-2 hsph-share-button-linkedin"><i class="fa fa-linkedin" aria-hidden="true"></i>LinkedIn</a><a rel="external noreferrer nofollow" target="_blank" href="http://www.reddit.com/submit?url=https%3A%2F%2Fwww.hsph.harvard.edu%2Fecpe%2Fthe-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them%2F&title=The+Financial+Pressures+That+Chairs+of+Clinical+Departments+Face%E2%80%94and+How+to+Manage+Them" aria-label="Reddit button link" class="btn btn-light btn-sm btn-squared shadow-none mr-2 mb-2 hsph-share-button-reddit"><i class="fa fa-reddit-alien" aria-hidden="true"></i>Reddit</a></span></div> <h3><strong>Financial Challenges and Strategic Solutions for Healthcare Leaders</strong></h3> <p><span style="font-weight: 400">Chairs of major clinical departments have always faced budgetary pressures. But the effects of the COVID pandemic—which have led to rising medical usage—as well as inflation and labor shortages are just some of the acute financial stressors taxing academic health centers right now. </span></p> <p><span style="font-weight: 400">“Costs of labor and goods are going up, but there is pressure to tamp down the rate of increase of health care costs. Many purchasers want to move from fee-for-service to alternative payment models, but these can be difficult for medical centers dealing with new technology,” explains </span><a href="https://www.hsph.harvard.edu/ecpe/faculty/jeff-levin-scherz/"><span style="font-weight: 400">Jeffrey Levin-Scherz, MD</span></a><span style="font-weight: 400">, assistant professor in the Department of Health Policy and Management at the Harvard T.H. Chan School of Public Health and program director of the </span><a href="https://www.hsph.harvard.edu/ecpe/programs/program-for-chairs-of-clinical-services/?utm_campaign=PCCS_Article_0124&utm_source=news_and_resources&utm_medium=article"><i><span style="font-weight: 400">Program for Chairs of Clinical Services</span></i></a><span style="font-weight: 400">.</span></p> <p><span style="font-weight: 400">Thus, it seems like a daunting challenge to both address challenges and also maintain a tighter hold on budget and margins—but luckily, it’s not insurmountable. </span></p> <p><b>The Problem of Fee-for-Service and Utilization for Health Care Chairs</b></p> <p><span style="font-weight: 400">Ultimately, many pre-existing challenges that make up a department’s financial picture (and, in a larger way, the health care system) come down to misaligned goals and values: </span></p> <ul> <li style="font-weight: 400"><b>Revenue</b><span style="font-weight: 400">: In the past (and still in the present, in some cases), chairs have often been held accountable for increasing the revenue of their department or center. This focus can be harmful because it may incentivize team members to focus on revenue and services over the demonstrated needs of the patients.</span></li> <li style="font-weight: 400"><b>Low-Value Services</b><span style="font-weight: 400">: Fundamentally, clinicians and other medical professionals aim to serve patients but can sometimes overemphasize volume, including services and procedures that have less “value” than others. For example, this could be an expensive test that might only be relevant for a few but is used on many. Not helping matters is the fact that certain pay systems encourage low-value services, and historically, hospital financial success has been judged by the number of beds filled.</span></li> </ul> <ul> <li style="font-weight: 400"><b>Financial Toxicity</b><span style="font-weight: 400">: Because </span><a href="https://www.texastribune.org/2022/06/16/americans-medical-debt/"><span style="font-weight: 400">100 million people in the United States</span></a><span style="font-weight: 400"> have medical debt, it’s important for chairs to remember the trickle-down burden of high health care costs on patients. This means clinicians will also need to internalize the focus on value—which many already believe in theory but can get sidetracked because of the above. </span></li> </ul> <p><b>Where Chairs Can Begin to Focus Attention as they Address Financial Strain</b></p> <p><span style="font-weight: 400">It’s important to keep in mind that a chair can’t fundamentally change entire payment systems overnight, nor can they have an impact on the larger health care system on their own. But, with focus and precision, they can still make impacts in their organization:</span></p> <ul> <li style="font-weight: 400"><b>Setting and Executing Goals</b><span style="font-weight: 400">: This does not simply mean a nebulous goal like “save money,” but a precise, thought-out action plan targeting the most effective cost-saving measures. “Be sure that decisions about people and processes are consistent with achieving those goals,” says Levin-Scherz.</span></li> <li style="font-weight: 400"><b>Understanding Policies and Procedures</b><span style="font-weight: 400">: Once a direction is established, a chair should seek to deeply understand the inner financial workings of their organizations, particularly how complicated policies and procedures may play a role. Beyond potentially streamlining finances, educating others in the organization—especially faculty members—can help the organization align on goals and needs. </span></li> <li style="font-weight: 400"><span style="font-weight: 400">Utilization: This ranges from organization to organization, but a good first step is to isolate which procedures and services are low-value and can either be outsourced or downscaled. Making this value-centric work clear to clinicians and other professionals is critical, and can even be its own goal. This may take time, so it’s important to measure success incrementally.</span></li> <li style="font-weight: 400"><b>Develop Better Reporting and Systems</b><span style="font-weight: 400">: To understand utilization and waste (as well as measure whether initiatives are working), reporting will further identify wasted costs in the system. With that in mind, “excellent business analytics staff are a key to success,” adds Levin-Scherz.</span></li> </ul> <h3><b>Looking Forward Beyond Short-Term Financial Goals</b></h3> <p><span style="font-weight: 400">Beyond the immediate goal of optimization, chairs can pay attention to larger-scale issues that can also impact finances. In the realm of hiring, for example, an increased focus on diversity, equity, and inclusion (DEI) is important to consider when hiring faculty, developing programs, and designing policies and procedures. </span></p> <p><span style="font-weight: 400">“A special issue is being sure that there are professional growth opportunities for those who have historically been discriminated against within academic medicine, including women and people of color,” explains Levin-Scherz. It will also be important to integrate leaders and DEI work into the organization itself, which also means looking at cost and waste for patients who have historically been underrepresented. </span></p> <p><span style="font-weight: 400">Another important aspect to pay attention to is climate change—in other words, advocating for decisions and programs that will decrease a department’s carbon footprint and helping to decrease the impact of future global warming. Ultimately, this will likely mean a number of infrastructure changes, including developments in technology involving more sustainable forms of energy. When done correctly, this can also proactively address operational costs. </span></p> <p><span style="font-weight: 400">So, taking the long view around finances, which means looking beyond the immediate budgetary needs of the organization and towards the bigger picture in and around the organization, can translate to improved financial health and better results for chairs of major clinical departments.</span></p> <p><span style="font-weight: 400">Harvard T.H. Chan School of Public Health offers the </span><a href="https://www.hsph.harvard.edu/ecpe/programs/program-for-chairs-of-clinical-services/?utm_campaign=PCCS_Article_0124&utm_source=news_and_resources&utm_medium=article"><i><span style="font-weight: 400">Program for Chairs of Clinical Services</span></i></a><span style="font-weight: 400">, a two-week systematic study of critical leadership and management issues facing chairs, their departments, and teaching hospitals.</span></p> </div> <footer class="entry-footer"> <div class="hsph-share-buttons hsph-bootstrap"><span class="hsph-share-btns-label">Share this:</span><a rel="external noreferrer nofollow" target="_blank" href="https://www.facebook.com/sharer/sharer.php?u=https%3A%2F%2Fwww.hsph.harvard.edu%2Fecpe%2Fthe-financial-pressures-that-chairs-of-clinical-departments-face-and-how-to-manage-them%2F" aria-label="Facebook button link" class="btn btn-light btn-sm btn-squared shadow-none mr-2 mb-2 hsph-share-button-facebook"><i class="fa 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