At the Becker's Hospital Review Annual CEO Strategy Roundtable, a dozen industry leaders came together in Chicago to discuss how they are navigating the dramatically changing landscape. Excerpts from their discussion are highlighted here in part two of a two-part series.
The rules of healthcare are changing: the tools transforming, the resources shifting — even the definition of success isn't firm.
As health systems grow and ownership concentrates, both C-suiters and physicians can feel the growing pains. Population health and value-based care initiatives are changing the way providers approach their work. New technologies present new opportunities, but also new risks and challenges. If one thing is definite in healthcare right now, it's that nothing is definite.
On Nov. 5, at the Becker's Hospital Review Annual CEO Strategy Roundtable, a dozen industry leaders came together in Chicago to discuss how they are navigating the dramatically changing landscape.
In a panel-style discussion, the leaders addressed their priorities and challenges, the effects of the Patient Protection and Affordable Care Act, the physician workforce, population health, C-suite size and bandwidth, independence and the outlook ahead.
Note: The following excerpts have been edited for clarity. This is the second part of a two-part series. Read the other roundtable discussion here.
Participants
- Dianne Anderson, RN, President and CEO of Lawrence (Mass.) General Hospital.
- Terry Akin. CEO of Cone Health (Greensboro, N.C.).
- John Brennan, MD, MPH, CEO of Newark (N.J.) Beth Israel Medical Center and Children's Hospital of New Jersey.
- Alan Channing. Former CEO of Sinai Health System (Chicago).
- Phil Kambic. President and CEO of Riverside Health Care (Kankakee, Ill.).
- Luke Lambert. CEO of Ambulatory Surgical Centers of America (Hanover, Mass.).
- Chuck Lauer. Former Publisher of Modern Healthcare (Chicago).
- Tom Mallon. Founder and CEO of Regent Surgical Health (Westchester, Ill.).
- Julie Manas. President and CEO of Sacred Heart Hospital (Eau Claire, Wis.).
- Ora Pescovitz, MD. Former CEO of University of Michigan Health System (Ann Arbor).
- Jim Rohan. Vice President and Managing Director of SullivanCotter and Associates (Chicago).
- John Jay Shannon, MD. CEO for Cook County Health & Hospital System (Chicago).
On population health
Alan Channing. Former CEO of Sinai Health System (Chicago).
Going back to the population health model, one of the things I think is going to be critical is not a medical model, but a community-based model that looks at how people live, where they spend their time, how they shop and what they know about shopping and preparing food.
As we think about changing our delivery model in a capitated environment, think about shifting some of those resources away from the latest scanner in favor of community-based education by people who are from the community to help employment. That can raise the level of what Phil and I have heard our colleagues describe as "patients having skin in the game." You have to give them tools to have skin in the game.
Phil Kambic. President and CEO of Riverside Health Care (Kankakee, Ill.).
Our whole business model of healthcare needs to change. I argue it is better care [when costs are removed]. At Riverside, we had frequent flier patients who continued to come to the ER. Those patients had been to the ER six to 18 times in a 12-month period. We paired those patients with nurses, who contacted the patients daily to check in and see how they're doing. None of those patients were readmitted in a 12-month period.
Julie Manas. President and CEO of Sacred Heart Hospital (Eau Claire, Wis.).
It's not so much about the number of hospitals [in a system] any more. For those of us who have been CEOs, I think we need to change the mindset to focus on the number of covered lives, the population served, the number of employees and so on.
On C-suite size and bandwidth
Ora Pescovitz, MD. Former CEO of University of Michigan Health System (Ann Arbor).
Size [of the C-suite] depends on the size of the organization, and I do think it's very difficult for a supervisor to supervise more than eight people. That seems to be generally the right number a person can give right amount of attention to. I've also found everybody wants to report to the CEO. One of the most difficult challenges is trying to maintain that distance.
Julie Manas. President and CEO of Sacred Heart Hospital (Eau Claire, Wis.).
Jeff Bezos, the CEO of Amazon, talks about the two pizza rule: You should never have a team bigger than what two pizzas can feed. That means you're nimble enough to make decisions but big enough where not everyone will think the same thing.
Luke Lambert. CEO of Ambulatory Surgical Centers of America (Hanover, Mass.).
We have an executive team of about five people, all of whom represent the company well and make things happen on a fairly autonomous basis. In terms of layers, there are probably only five people in the chain of command between myself and a person working with the patient.
Jim Rohan. Vice President and Managing Director of SullivanCotter and Associates (Chicago).
I agree with the concepts, but don't see it in reality too often. A lot of our clients are $4 billion in revenue and up, and they certainly have staff deeper than eight. I love when the board says, "John, you have too many people reporting to you." Good boards do that all the time. We're getting bigger, and after a merger and acquisition, from eight executives you then have 15. So boards step in and say, "No more."
Phil Kambic. President and CEO of Riverside Health Care (Kankakee, Ill.).
You can never have enough leadership in an organization. I have nine senior executives. How do you continue to give managers growth opportunities to grow them? If one of my senior executives does leave, maybe a manager can step into that role. I think leadership development is key.
On hospital independence
Julie Manas. President and CEO of Sacred Heart Hospital (Eau Claire, Wis.).
Those hospitals that are independent will continue to try to remain as such, but I don't think it's realistic to think they won't have some formal contractual relationship with another company for some piece of their business.
Phil Kambic. President and CEO of Riverside Health Care (Kankakee, Ill.).
What's the business case for not being independent? In my case, we are very successful and have great quality, great financial performance and access to capital. There's not a pressing need [to lose independence]. Until the business model changes, what's the advantage [of affiliation] to the community and patients I serve?
Alan Channing. Former CEO of Sinai Health System (Chicago).
I think it's a bifurcated notion. What does it mean to be in a partnership? What does the partnership look like? There are a lot of different models out there. Phil Kambic's point about people knocking on his door is the antithesis of my experience. They closed the door when they saw me coming. 'Why do we — a big successful organization — want to deal with someone from the safety-net environment?' My experience is slightly different. I could use a partner who has a compelling business case form quality perspective and access to capital.
Looking forward
Julie Manas. President and CEO of Sacred Heart Hospital (Eau Claire, Wis.).
I am optimistic because I see all of you here willing to learn and share best practices. If I'm not optimistic as a leader, I can't expect those taking care of patients will be optimistic. We have to mold ourselves to the changing environment rather than being rigid.
Ora Pescovitz, MD. Former CEO of University of Michigan Health System (Ann Arbor).
I'm extremely optimistic, too. Darwin said those that best manage change survive. There are dramatic changes, new discoveries and advancements all across the industry. I think the future is very bright.
Jim Rohan. Vice President and Managing Director of SullivanCotter and Associates (Chicago).
This is a great opportunity to reinvent yourself. You're not the first CEO to go through this stuff. There are a lot of lessons to be learned from auto, banking and other industries.
Alan Channing. Former CEO of Sinai Health System (Chicago).
I'm bullish on healthcare reform and bullish on today's environment. This is a tremendously exciting time, and I think each of us has said we're excited because we're leaders.
Chuck Lauer. Former Publisher of Modern Healthcare (Chicago).
I've been in healthcare for about 50 years. Look at the quality of the people on this panel. They're all adapting to change. This is a great industry and will continue to be, and the quality of people in this industry is better than any other industry. I think the future of healthcare is great, and this is an exciting time to be here, and I applaud the professionals in this industry.