Keeping the Health System Healthy

Meeting our operating margin goals to maintain a strong UMHS foundation, and how faculty and staff across the Health System are making a difference

Each year, the Hospitals and Health Centers set specific financial goals for its operating margin (revenue less expenses) to ensure a strong financial standing. Tracking that goal closely is the key to ensuring our future, according to Doug Strong, director and chief executive officer, UMHHC.

“Our goal is to meet a 3 percent operating margin or better on average over time in order to have the resources to invest in ourselves. Our operating performance is directly linked to our future,” he says.

Providing for those future investments takes careful planning. The 10-year Strategic Financial Plan projects resources and cash on-hand needed for building projects, such as the new children’s and women’s hospital, improvements to facilities and information systems, such as the Electronic Patient Care Environment that includes U-M CareLink and the Ambulatory Care Information System, and investment in the Medical School.

“The Strategic Financial Plan really lays out our financial road map for the future. Our performance in patient care operations drives our ability to invest in ourselves and improve the patient care environment,” says Dave Morlock, senior associate director and chief financial officer.

One of the many ways in which Health System employees can help meet our goals is to adopt and practice the Michigan Quality System philosophy. MQS uses “lean thinking” concepts to streamline and improve processes and systems. It is part of our continuing effort to improve quality, safety, efficiency, appropriateness and service across our three missions of patient care, education and research.

“Much of our success depends on creating an environment where we can deliver the highest possible quality of care,” Strong says.

And that environment starts with all Health System faculty and staff. (Want to learn the Budget Basics? Visit this Web site!)