Earlier this year, the brains behind Amazon, Berkshire Hathaway and JPMorgan and Chase — Jeff Bezos, Warren Buffett and Jamie Dimon, respectively — embarked on an effort to lower healthcare costs for their U.S. employees.
While the details of the company have been vague, leaving a number of healthcare experts to speculate what the trio may pursue, Mr. Buffett said he believes the company will need a "top-notch CEO … [who] has to be someone who really has a grasp on [healthcare] from every angle."
In fact, in early March, sources revealed Berkshire Hathaway's Investment Manager Todd Combs is taking the lead for the CEO search. So far, the trio approached candidates like former Medicare Acting Administrator Andy Slavitt, former United States CTO Todd Park and ex-Aetna senior executive Gary Loveman.
Becker's Hospital Review spoke with three executive search firms to gain their insight into what kind of individual would make the best CEO for the new company. Here is what those firms had to say.
Editor's Note: Responses have been lightly edited for clarity and length.
Question: What types of characteristics should Amazon-Berkshire Hathaway-JPMorgan Chase seek in this CEO?
Ed Stout, managing partner at Grant Cooper: "First and foremost, they need to find a man or woman who is a world-class team-builder. The senior team of this entity will probably include experts from different parts of the healthcare value chain that are often in tension. This CEO will need to find and attract these people and create an environment in which they can set aside whatever biases they have and collaborate. Second, the CEO must have leadership courage — almost unencumbered by traditional views of how healthcare is delivered and paid for and completely unafraid to destroy the legacy model and rebuild it in a totally new way. Finally, they will need to find someone who can inspire the organization to persevere; this will be a long and difficult journey, even for this impressive group."
Paul Bohne, managing partner and leader of Witt/Kieffer's healthcare practice: "As Warren Buffet said himself, it has to be someone who sees healthcare from every angle. But then it also has to be someone who can see it through a different lens, to see outside current parameters. Clearly, the person has to be a visionary, builder and influencer who can get other people behind the new enterprise. And, the CEO will have to be comfortable with being labeled as a disruptor — it will take courage and creativity to build this out, to break down perceived institutional and industry barriers, and win over skeptics. So, it's an extremely tall order. Are there people like that in the industry? It will be a small pool of candidates given the role's scope and agenda."
Preston Smith, president at Tyler & Co: "The prospective leader should reflect the leadership styles of the founders — the innovation of Bezos, the boldness and discernment of Buffett and the financial acumen of Dimon. The leader will need to be intuitive, ambitious, communicative, authoritative and respected in his/her field. He/she should be a self-starter with a proven track record of success in leading a start-up. He/she should be a risk-taker with the ability to be conscientious and effectively use predictive analytics. With this, he/she should identify leading indicators to drive behavior modification and genuinely improve the health of the population served by the healthcare entity ... The leader must leverage the purchasing power of this new venture to force competitive pharmaceutical pricing and healthcare providers to become more transparent by, for example, pooling resources and knowledge to share best practices and disclose true costs. One of the most important qualities is the ability to 'think outside the box' and be willing to bring disruptive forces into the healthcare environment. This requires a willingness to embrace technology, including virtual medicine; synthesize medical records of the patient; and take care coordination to a new level. However, the cost/benefit should lead to a dramatic result to improve care and bend the cost-curve vis-à-vis the current healthcare system."
Q: What knowledge should this person have?
ES: "The CEO should have knowledge of how to engage consumers first and foremost, in my opinion. This is both because healthcare needs a fundamental rethink that puts the consumer in the center and also because encouraging consumers to act in their own best interest is going to be a huge part of the solution. Healthcare knowledge is a nice to have — it can be learned by a gifted CEO and supplemented greatly by the team."
PB: "One of the primary goals of the venture is to innovate on the delivery aspects, so someone who understands how to improve processes and get the most out of people and resources. It has to be someone with expertise in organization building and large-scale growth. The executive will need to show a commitment to new and innovative consumer-centric healthcare models. Given the complexity of the venture, the new CEO can't do everything — it will be critical to surround herself/himself with a great team, rely on their talents and coalescing them around goals and strategy."
PS: "To spearhead a venture with the goal of cutting healthcare costs and its size relative to the GDP, while also increasing quality, affordability and patient satisfaction, requires a versatile leader with a well-rounded set of skills. This leader should have knowledge of all aspects of healthcare, including the perspectives of hospitals, healthcare providers, patients and other important stakeholders. He/she must understand insurance risk and customer service, and obtain thorough knowledge of the cost and revenue drivers associated with healthcare finance. A legal and/or political background could be beneficial as well."
Q: What experience should this person have?
ES: "I think excellent candidates will already have many years of experience leading a large and complex organization in which they have had to build consensus across the organization. I would hope that they have created consumer-facing products or, preferably, services. Prior large-scale profit and loss responsibility is a must-have as well."
PB: "It will have to be someone who has built and transformed organizations and led innovative new business models along the way. It would also help for this person to have a diversity of leadership experience in healthcare and in corporate settings."
PS: "The leader of the new company will need a mix of political, legal, financial and healthcare knowledge and experience. I believe the choice for this venture will not resemble "your father's Oldsmobile." Rather it will be an unconventional choice that reflects the changing demands of a leader in the new and dynamic environment of 21st century healthcare. This may be a successful business person — or perhaps even a healthcare lawyer with an entrepreneurial bent — who has served in healthcare leadership or on the board of a hospital or health system. This person would need to have experience in business as well as in healthcare, and have some experience dealing firsthand with the challenges that healthcare organizations face every day."
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