Robert A. Broermann Sentara Healthcare Norfolk

2006 CFO of the Year -
Large Private Company
Financial strategies contribute to Sentara's national ranking

by Robert Powell
for Virginia Business
July 2006

There’s more to life than breaking even, especially for the CFO of one of the nation’s top-ranked private, nonprofit health-care organizations.

Since becoming chief financial officer of Norfolk-based Sentara Healthcare in 2001, Robert A. Broermann has fine-tuned the company’s finances with the gusto of a large public company CFO. Net operating income is up 296 percent to $148 million. Sentara is opening new facilities, and it recently snagged a national ranking.

Broermann’s efforts to increase revenue, lower costs and promote efficiency contributed to Sentara being recognized this year as the third-best integrated health network in the United States by Modern Healthcare magazine. Financial stability was a major factor considered by the magazine in its ranking.

Broermann now can add an individual honor to that accolade. Virginia Business has named him CFO of the Year for private companies with more than 100 employees.

“ I believe that Rob’s most valuable quality as a CFO is his willingness and confidence to be an independent thinker,” says William A. Terry in a letter supporting Broermann’s nomination for the award. Terry is a principal with Highland Associates, Sentara’s outside investment adviser.

Terry notes that while universities have used alternative investments such as hedge funds for many years, few health-care companies have made that choice. Broermann persuaded Sentara’s finance committee to allow modest allocations in alternative investments while also restructuring its fixed income portfolio. As a result, Terry says, Sentara last year had one of the best performing investment portfolios in its industry.

Sentara provides health-care services and health coverage in southeastern Virginia and northeastern North Carolina. It has 70 health-care sites, including seven acute-care hospitals.

Broermann joined Sentara in 1998 after its merger with Tidewater Health Care where he had been CFO since 1993. In nominating him for the award, Sentara CEO David L. Bernd says that the company has prospered under Broermann’s leadership. Sentara has increased revenue, lowered its cost of capital and reduced operating costs by more than $70 million.

Sentara’s financial strength, adds Bernd, led to the implementation of a $900 million capital investment campaign. Earlier this year, Sentara opened a $94.6 million heart hospital in Norfolk, the first dedicated heart hospital in the Hampton Roads region. Next month it plans to open the $93 million Sentara Williamsburg Regional Medical Center, which will replace Williamsburg Community Hospital.

Broermann also has been involved in Sentara’s mergers and acquisitions, including its $130 million acquisition of Obici Health System in Suffolk.

“ I am especially impressed with Rob’s comprehensive involvement in the development of the strategic direction of Sentara,” says Kent Jackman, director of Citigroup Global Markets, in a letter supporting the nomination. “He not only grasps the minutiae, he is a policy setter to the big picture, rarely a role played by a CFO.”