Essential competencies for rural health care CFOs

Rural health care CFOs operate in a distinct environment — one that requires not only financial expertise but also an exceptional ability to navigate challenges unique to rural hospitals and health care systems. While core CFO competencies such as strategic foresight, risk management, technological proficiency, and adaptability remain essential, they often show up differently in rural settings.

With that in mind, we have examined some of the top finance leadership competencies through the lens of rural health care CFOs, offering some ideas about how they can be leveraged and strengthened to meet the distinct demands of their roles.

1. Financial acumen: Maximizing resources for patient care

While financial expertise is fundamental for any CFO, in rural health care it extends beyond balancing budgets. Rural CFOs must stretch every dollar, optimizing government reimbursements, grants, philanthropic funding, and insurance payments to keep their hospitals financially sustainable.

Ways to strengthen this skill:

• Engage with peer networks to exchange strategies for optimizing reimbursements and managing cash flow.
• Stay informed on legislative changes affecting Medicaid, Medicare, and rural health funding.
• Consider financial scenario planning to test different budget strategies under various economic conditions.
  
  

2. Strategic planning: Preparing for an uncertain future

Strategic thinking is critical in any CFO role, but in rural health care, it often means planning for sustainability rather than expansion. Rural CFOs must anticipate shifting payer models, changing patient demographics, and evolving regulatory requirements, ensuring their hospitals remain viable in an unpredictable health care landscape.

Ways to strengthen this skill:

• Conduct financial forecasting exercises to prepare for reimbursement fluctuations and patient volume changes.
• Develop contingency plans for unexpected events, such as staffing shortages or supply chain disruptions.
• Foster relationships with health care coalitions to stay ahead of policy changes that impact rural hospitals.
  
  

3. Risk management: Proactively protecting rural hospitals

Rural hospitals operate with thin margins, making risk management a critical responsibility. From cybersecurity threats and reimbursement delays to workforce shortages and public health emergencies, CFOs must mitigate a variety of risks that could impact service delivery.

Ways to strengthen this skill:

• Regularly review and update financial risk assessments to address emerging threats.
• Partner with IT leaders to ensure cybersecurity measures are robust and proactively mitigate risks associated with ransomware and data breaches.
• Diversify revenue streams where possible, exploring opportunities such as outpatient services, specialty care partnerships, or value-based care models.
  
  

4. Leadership and team development: Building a resilient financial team

In rural health care, finance teams are often small, requiring CFOs to lead with a hands-on approach. The ability to build strong teams, foster engagement, and develop staff for multi-functional roles is crucial.

Ways to strengthen this skill:

• Invest in professional development for finance staff, ensuring they have opportunities to enhance their skills.
• Encourage cross-training so staff members can cover multiple roles to help increase operational resilience.
• Implement mentorship programs within the hospital to retain talent and build long-term leadership capacity.
  
  

5. Technological proficiency: Driving digital transformation in rural health care

Health care technology is evolving rapidly, and while rural hospitals may face budget constraints, leveraging technology effectively can improve financial operations and patient care. CFOs must understand how technology investments such as telehealth, AI-driven analytics, accounting, and revenue cycle management tools can support their hospital’s mission.

Ways to strengthen this skill:

• Identify low-cost, high-impact technologies that align with the hospital’s strategic priorities.
• Work closely with IT teams to ensure new technology implementations are cost-effective and sustainable.
• Explore grant funding opportunities for technology investments that improve financial and operational efficiency.
  
  

6. Communication skills: Bridging the gap between finance and operations

A rural health care CFO's role is as much about communication as it is about numbers. Whether presenting financial data to the hospital board, explaining budget constraints to clinical leaders, or advocating for funding with community stakeholders, the ability to translate complex financial information into actionable insights is essential.

Ways to strengthen this skill:

• Practice storytelling techniques to make financial data more engaging and relevant to different audiences.
• Hold regular financial literacy sessions for department heads to enhance their understanding of budgeting and cost management.
• Develop concise, visually compelling financial reports that make key takeaways easy to understand.
  
  

7. Adaptability and innovation: Embracing change to ensure sustainability

Rural health care is constantly evolving, requiring creative thinking to adapt to new challenges. Whether dealing with reimbursement model changes, regulatory shifts, or evolving patient needs, rural CFOs need to be nimble and forward-thinking.

Ways to strengthen this skill:

• Stay engaged with industry groups and thought leaders to learn about emerging trends and best practices.
• Encourage a culture of innovation within the hospital where staff feel empowered to propose efficiency improvements.
• Conduct pilot programs for new financial models or service line adjustments before full implementation.
  
  

8. Analytical skills: Leveraging data to drive financial decision-making

Data-driven decision-making is crucial in rural health care, where every financial choice has significant implications. This means CFOs must be able to analyze cost structures, identify revenue opportunities, and forecast financial trends accurately.

Ways to strengthen this skill:

• Prioritize tools that streamline time-consuming tasks like month-end reporting, particularly for lean teams. Automating reconciliations and reports frees up time for cash flow, billing, and planning priorities.
• Develop dashboards that integrate clinical and financial data to track key performance indicators effectively.
• Participate in benchmarking studies to compare financial performance with similar rural hospitals.
  
  

9. Ethical standards: Maintaining trust and transparency

Rural hospitals operate within close-knit communities where financial integrity is critical. CFOs must uphold the highest ethical standards, ensuring that financial decisions align with both regulatory requirements and the organization’s mission to serve patients.

Ways to strengthen this skill:

• Implement clear policies on financial transparency and reporting.
• Foster an organizational culture where ethical considerations are at the forefront of decision-making.
• Regularly review compliance with financial regulations and conduct internal audits to identify potential risks.
  
  

10. Advocacy and influence: Securing resources for rural hospitals

Rural hospitals often depend on external funding and policy support. CFOs serve as advocates for their organizations and can help ensure decision-makers understand the critical role of rural health care facilities.

Ways to strengthen this skill:

• Build relationships with health care advocacy groups to stay informed on funding opportunities.
• Engage in community outreach to highlight the hospital’s impact and encourage local philanthropic support.
• Develop compelling proposals and presentations for funding requests and board reporting using data to illustrate financial needs and projected outcomes.
  
  

The bottom line: Rural health care CFOs are essential leaders

The challenges faced by rural health care CFOs require a unique blend of financial expertise, strategic foresight, and adaptability. These professionals are not only responsible for managing budgets but also for ensuring the long-term viability of health care services in their communities.

By continuously honing these skills and competencies, rural health care CFOs can enhance their effectiveness, drive innovation, and secure a sustainable future for the organizations they serve.

As an ERP partner to hundreds of rural and smaller health care organizations, Multiview understands the realities of operating with limited staff and constrained budgets. Effective, scalable financial tools shouldn't be accessible to only the largest health systems. To explore how these challenges can be addressed with the right technology and support, connect with the Multiview team.

NRHA adapted the above piece from Multiview, a trusted NRHA partner, for publication within the Association’s Rural Health Voices blog.

Authors

Mike Johnson, CEO, Multiview Financial Software

Diane Moore, CFO, Mitchell County Hospital

Kimberly Cooper, CFO, Chambers County Public Hospital District No. 1