Latest / Becker’s Healthcare Podcast / Garrick Stoldt, CPA, FHFMA, Vice President and Chief Financial Officer at Saint Peter’s Healthcare System

Transcript

Garrick Stoldt, CPA, FHFMA, Vice President and Chief Financial Officer at Saint Peter’s Healthcare System · Becker’s Healthcare Podcast

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  - There's a small circle of people who truly
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  - understand what it takes to lead a health
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  - system right now. The decisions are enormous.
• 0:08
  - The variables are constantly shifting, and the stakes
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  - of getting a call wrong don't stay contained.
• 0:14
  - That's not a complaint. It's a structural reality.
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  - And it's why the most effective c suite
• 0:19
  - leaders are deliberate about where do they go
• 0:21
  - to pressure test their thinking.
• 0:22
  - Becker's fourteenth annual CEO and CFO roundtable
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  - brings together more than 1,500
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  - executive level attendees
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  - and nearly 400 speakers for four days built
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  - around growth, financial sustainability,
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  - workforce strategy, and the leadership questions that don't
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  - have easy answers.
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  - Join us November second through the fifth in
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  - Chicago.
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  - For the agenda and event details,
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  - visit beckershospitalreview.com
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  - and click on the events tab in the
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  - upper right.
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  - This is Laura Dirdo with the Becker's Healthcare
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  - podcast. I'm thrilled today to be joined by
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  - Garrick Stolt, vice president and chief financial officer
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  - of St. Peter's Healthcare System. Derek, it's a
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  - pleasure to have you on the podcast today.
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  - Oh, thank you for having me.
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  - Absolutely. Now I'm excited for our conversation. I
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  - know we're gonna dig into some of the
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  - great things they're doing at St. Peter's as
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  - well as how you're thinking about the future.
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  - But before we do, can you tell us
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  - a little bit more about yourself and your
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  - background?
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  - Well, I've been, at St. Peter's now in
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  - my twenty first year as a chief financial
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  - officer, which is kind of a rarity.
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  - Most CFOs last about five years in health
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  - systems these days. So,
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  - I'm a little bit different than others. My
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  - background,
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  - even though I'm a CPA, my background's in,
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  - my education's in economics.
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  - I didn't have an accounting degree, I had
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  - an economics degree, so that's really helped me
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  - quite a bit in my career.
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  - I've been at a couple of health systems
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  - and I was early in my career as
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  - a regulator
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  - for doing Medicare and Medicaid cost report audits
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  - and then public accounting for about ten years.
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  - So
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  - I have a huge unique amount of experiences
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  - because of my education and, and background.
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  - So, it has helped me quite a bit
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  - in my career.
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  - That's fantastic to hear. And, definitely, you know,
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  - great to have that type of,
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  - kind of
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  - unique background. Especially right now, I'm thinking about,
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  - economics and everything else. I know there's a
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  - lot happening in health care today, but,
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  - can you first just give us a quick
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  - state of the union for St. Peter's health
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  - care system? What's going well this year, and
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  - what are you focused on for the rest
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  - of 2026?
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  - Yeah. So here at St. Peter's, we're in
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  - New Brunswick, which is, New Jersey, which is
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  - right right in central...
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  - Right in the center of the state.
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  - We're actually having a decent year.
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  - Our volume has been a little bit light,
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  - but we're on budget. I think one of
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  - the big things for us is the fact
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  - we're controlling our expenses to volume.
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  - So as volume goes down or up, we're
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  - adjusting accordingly
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  - and keeping our margins in line.
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  - Outpatient growth, that's been really a big element
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  - in strategy, a lot going on there and
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  - we are growing on an outpatient basis, which
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  - is great.
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  - We're right now in the middle of installing
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  - Epic,
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  - so
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  - we expect to go live in 2027.
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  - That is a huge lift
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  - for
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  - our organization
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  - because we're going live with our physician enterprise
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  - as well as our facility. So we're a
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  - single hospital system, so,
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  - all hands on deck to get that finished.
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  - But I think the big thing that we're
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  - that we're kind of proud of this year
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  - is we just opened up in beginning of
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  - September
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  - a specialty pharmacy.
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  - We're a three forty b hospital,
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  - so,
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  - we're able to get drugs at a much
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  - lower price,
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  - than
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  - than a GPO.
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  - And,
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  - being a 340B
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  - hospital, what has happened over the last couple
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  - of years is the manufacturers
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  - have created
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  - geographic restrictions on allowing the 340B discounts, mostly
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  - on the higher end cost drugs.
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  - So having a specialty pharmacy on hospital grounds
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  - circumvents
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  - the ability for manufacturers
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  - to create these
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  - restrictions
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  - on three forty B
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  - discounts.
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  - So that's going to be a a significant
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  - revenue source for us going into the future.
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  - That's fascinating to hear. And I I know,
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  - you know, there's a lot of focus on
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  - the three forty b in the pharmacy right
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  - now. So when you think about,
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  - kind of
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  - the opportunities you have and expansions you have,
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  - what are some of the headwinds there as
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  - well? Can you talk a little bit about
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  - the things that you're focused on and and,
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  - how you're,
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  - planning and and navigating around them?
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  - Well, the big thing is we're looking for
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  - locations
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  - to put,
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  - ambulatory,
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  - buildings up, maybe forty, fifty, 60,000
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  - square foot buildings up with multiple,
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  - both primary care and specialty care and ancillary
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  - support services.
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  - So we're in the middle
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  - of several of those.
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  - Our only headwind
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  - is how much capital that we may need
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  - to put out.
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  - We are our balance sheet is extremely strong.
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  - We've got four times more cash and investments
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  - than long term debt. So we have pretty
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  - good debt capacity, but it's not limitless. So
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  - we have to be very strategic where we
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  - put these facilities up
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  - in order to expand because as you well
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  - know, so much of the businesses in healthcare
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  - now is moving to outpatient.
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  - So our long term strategy is to create
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  - a significant we already have about 28 locations
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  - between counties north of us and South of
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  - us. We're in about seven or eight different
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  - counties within New Jersey. So our footprint is
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  - pretty wide and we continue
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  - so our key is to grow that our
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  - market share in areas that, that we're not
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  - as as strong in right now to stabilize
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  - our outpatient growth,
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  - over the next few years.
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  - Got it. That makes a lot of sense.
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  - And know, I I think more and more,
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  - we're hearing a lot about that outpatient growth,
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  - whether it's looking at some of the different,
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  - the physician offices or, you know, to your
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  - point, primary care and thinking about other services
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  - at pharmacy and more. So,
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  - I'm curious. It's impressive to see how you've
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  - gotten,
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  - into your current financial position. Balance sheet is
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  - strong. What kind of discipline does it take
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  - to get to that point, and how you
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  - see that strategy continuing to evolve as you're
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  - going more outpatient,
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  - and then, you know, wanting to still be
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  - financially strong in the future.
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  - Well, it was a long struggle. I've been...
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  - Twenty one years ago,
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  - we had long term debt was about 30%
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  - higher than our unrestricted cash and investments. So
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  - it's been a long term
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  - play in order to
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  - right size the balance sheet and make it
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  - stronger. So
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  - the key thing was capital control and limiting
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  - debt,
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  - adding on new debt. So
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  - it's a financial discipline that takes time
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  - to make it happen, and we've done that.
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  - We've had small amounts of debt taken on,
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  - but very strategic.
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  - And we've also been able to do things
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  - to improve our operations. For instance,
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  - anytime federal money or state money is available
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  - for
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  - projects and growth, we've availed ourselves
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  - of them. We've done so many energy savings
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  - projects with the lowest cost per we believe
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  - with the lowest cost per square foot for
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  - a healthcare facility
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  - in the state
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  - on energy use.
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  - And energy costs have just continued to go
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  - higher and higher and higher. And if we
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  - look at a graph of the last fifteen
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  - years,
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  - our actual spend on energy
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  - is actually declined
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  - about 45%
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  - over the last fifteen years.
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  - So that's just one of the strategic elements.
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  - And so by using... We would have had
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  - to replace most of our infrastructure and energy
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  - anyway, but using,
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  - OPM, other people's money,
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  - that, that helps quite a bit.
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  - Got it. That's,
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  - you know, really helpful to understand. And then,
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  - you know, when you think about growth, what
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  - are some of the best opportunities that you're
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  - seeing for the next two to three years
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  - or so?
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  - Well, right now, we're having discussions with a
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  - number of of independent physician groups.
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  - Not every physician group wants to become
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  - part of a big system,
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  - but they do want to
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  - stay connected to a hospital,
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  - for their services. So
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  - we're now working with a number of physician
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  - independent physician groups,
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  - which I think is, which is certainly going
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  - to feed into
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  - our growth strategy, especially
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  - in some of the outpatient ambulatory
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  - buildings we're planning on
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  - putting up. So this will this dovetails right
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  - into
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  - expanding both our footprint as well as these
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  - independent physician groups.
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  - That's great to hear. And I... I'm... You
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  - know, truly seems like a a huge accomplishment
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  - to be able to expand your footprint to
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  - partner with, the physician groups and have, to
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  - your point, a variety of different opportunities and
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  - options to do that, depending on the group
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  - and the community and what works best for
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  - patient care.
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  - Oh, absolutely.
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  - And, and gaining market share and going out
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  - further than our normal reach,
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  - is certainly part of of, our long term
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  - strategy.
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  - Fantastic. Well,
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  - I'm curious now, before we wrap up, I
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  - wanted to ask you about leadership. Can you
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  - tell me about a leader that you admire
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  - really from any industry and why?
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  - Well, I've been fortunate enough,
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  - over my career
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  - to have two
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  - individual leaders I thought were absolutely excellent.
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  - And so from personal experience... Because I've also
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  - experienced probably the worst leader
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  - of all time. I remember,
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  - one day I saw something on LinkedIn that
• 10:11
  - said
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  - eight traits of a toxic leader and the
• 10:14
  - particular leader I was under at that time
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  - ticked off all eight. So I know what
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  - a bad leader is.
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  - So it's, when you have a good leader
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  - and you and you appreciate,
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  - their,
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  - their
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  - method of leadership,
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  - you you, you can appreciate that tremendously.
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  - I have the leaders that are transparent,
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  - to the point as much as they can
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  - be. Leaders can't really disclose everything, but when
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  - you have transparent leaders
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  - and they give you their thought process,
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  - they give you their,
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  - they give you the ability to act on
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  - your own.
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  - Those are things, and this trust build up,
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  - between you and that leader. And trust is
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  - probably the best word you can use to
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  - describe this industry, especially between healthcare providers and
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  - patients, but it's also among management and leadership.
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  - Trust is the key. If you don't have
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  - trust,
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  - there's no way you're going to be effectively
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  - effective in running an organization.
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  - So having two leaders that I... That we
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  - had trust in that,
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  - that actually
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  - made a difference
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  - because of their leadership style.
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  - Many things happen much easier when you know
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  - that the person at the top has not
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  - just the institution's best interest, but the individuals
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  - that report to them's best interest.
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  - That's a rare character,
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  - trait today. You don't see that all the
• 11:44
  - time.
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  - But I've been fortunate in my career to
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  - have two people that fit that bill.
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  - That... That's amazing. And, definitely, that transparency,
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  - can really be the difference to your point
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  - between building the trust and and then just,
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  - you know, trying to build a culture around
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  - that is truly remarkable.
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  - Thank you so much for joining us on
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  - the podcast today, Gary.
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  - Such a great pleasure to speak with you
• 12:10
  - and and hear, some of the cool things
• 12:12
  - that you're doing, and I look forward to
• 12:14
  - seeing you as well at our CEO CFO
• 12:16
  - roundtable. I know that you'll be speaking on
• 12:18
  - a session there, and it'll be a lot
• 12:20
  - of fun to catch up in person and
• 12:21
  - dig deeper into some of the things we
• 12:23
  - talked about today.
• 12:24
  - Thank you so much for having
• 12:25
  - me.