Duncan Gallagher, President of Donegal Advisory Services, brings over 30 years of experience as an integrated health system CFO and senior management leader. His most recent role was Executive Vice President, Chief Administrative Officer and CFO of Allina Health, a $4.0 billion not-for-profit integrated health system based in Minneapolis. In his seven years as CFO at Allina Health, Gallagher was instrumental in establishing the health system as a national leader in navigating the shifting healthcare payment model from fee-for-service to one based on value and care quality. In the process, Allina demonstrated that the shift is better for patients, and can be financially viable for health system.
In 2014, Allina pioneered the outsourcing of Allina’s $10 million, 70 FTE analytics department through a unique partnership with Health Catalyst. Leveraging the intellectual property of both partners while driving sharper focus, this arrangement ties Health Catalyst’s profit from the relationship to the delivery of measurable cost savings tightly aligning Allina’s success with its that of its partner. Gallagher played a central role in the formation of this strategy and led the development and negotiation process
In 2016, Gallagher led a forward-looking strategy development process with the Allina senior management and its Board of Directors, shifting its system strategy and creating an Allina health plan serving the Twin Cities market, supported and enabled by the deep expertise and strong payor platform of its health plan partner, Aetna.
While at Allina, Gallagher was recognized by the Minneapolis Business Journal as 2016 CFO of the year. Before Allina, Gallagher spent 10 years as Executive Vice President and Chief Operating/Finance Officer with Des Moines-based Unity Point Health, a $4.1 billion integrated health system. Gallagher previously served as a Partner with KPMG. His educational background includes an undergraduate degree from the University of South Dakota, and Master of Business Administration from the University of Minnesota’s Carlson School of Management.
24 – A Bad Moon on the Rise? How We Raised the Sense of Urgency and Built a Strategy Shift with our Board of Directors
The pressure on fee-for-service (FFS) payment models continues to build. These models reward increased utilization of health care services, raising the total cost of care. To offset these increases, the adjustments to payment rates are declining. Government rate cuts are not uncommon. As a result, in most markets, health system operating margins are under unprecedented duress as the cost of providing care is increasing at a rate significantly higher than the rate of FFS payment increases.
While many are focused on insurance coverage under the Affordable Care Act or proposed replacement legislation, few are talking about the core underlying problem: health care services are too expensive. Purchasers, (governments, employers, individuals), are desperate for more effective ways to incent and ensure the best patient care is consistently accompanied by affordability and efficiency. Value payment models are emerging and rapidly evolving to stem the increase in total cost of care, while providing alternative incentives to those of the FFS models. The federal government is advancing new models of payment for physicians and hospitals. Provider/payor contracts and ventures are accelerating the transfer of risk (and reward) for health care service costs to healthcare providers services through a range of pay for value incentive programs/models. The market is ripe for alternative solutions.
How will you convince your board–and your organization–to adapt its market strategy and operating/finance structures to survive, and even thrive, under these alternative models? Come and hear the Minneapolis Business Journal 2016 CFO of the year speak about his experience in engaging health system board members and senior executives in strategic dialogue about the necessary transition. You will learn how they collectively concluded that pursuing greater risk sharing was the organization’s best, perhaps only, path forward, and how partnerships were its best vehicles.