Lifespan hires FTI Consulting Health Solutions

DR. TIMOTHY J. Babineau, president and CEO of Lifespan, said the fiscal 2017 budget process is underway. / COURTESY LIFESPAN
DR. TIMOTHY J. Babineau, president and CEO of Lifespan, said the fiscal 2017 budget process is underway. / COURTESY LIFESPAN

PROVIDENCE – Lifespan, which is in the midst of crafting its fiscal 2017 budget, has hired FTI Consulting Health Solutions, a health care advisory firm described as having a track record of helping other organizations address fiscal challenges.
The news about Lifespan’s budget and FTI Consulting Services was included in a memo from Dr. Timothy J. Babineau, president and CEO of Lifespan, obtained by Providence Business News.
Babineau said the budget process is “close to a $2 billion dollar task.” He said fiscal year 2015 was “particularly challenging” for the system, as it lost nearly $33 million dollars from operations.
This year, fiscal year 2016, “has seen some improvements in our operating performance but we have a lot of hard work to do in our last four months to ensure that we get as close as possible to our budget target of a positive $1 million,” Babineau wrote.
He wrote that as a result of the Affordable Care Act, a greater number of patients are insured, but the insurance they have (Medicaid, Medicare, high-deductible plans and risk-sharing arrangements) results in “substantially less revenue” to Lifespan.
Babineau added that caps on commercial insurance rate increases from the state Office of Health Insurance Commissioner “adds to the downward pressure on reimbursement rates.”
Those factors, combined with increases in the costs of technology, drugs and medical supplies, place “enormous stress on the entire business model of Lifespan,” he wrote.
FTI, he wrote, “has experience working with some of the best academic health care systems in the country.” He said the partnership has already begun and includes data collection, surveys, interviews, tours and observations.
“By anticipating and preparing now, we can sustain our mission of delivering health with care and add to the financial strength and stability of the organization to deliver the highest quality care and the best patient experience,” Babineau wrote.

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