Navigating the ever-changing landscape of the healthcare industry is a challenging task. Having to lead a healthcare facility through that landscape is even more difficult. But Gene Michalski, CEO of Royal Oak, Mich.-based Beaumont Health System, believes that the inherent complexity of the healthcare industry is what makes it so exciting.
Since 2010, Mr. Michalski has been at the helm of Beaumont, before which he served as its 
executive vice president and COO. Mr. Michalski has also previously held leadership positions at Beaumont Hospital, Troy (Mich.). He has served as past president of the Midwest Healthcare Executive Group and Associates, and in 2012, he was named to the Becker's Hospital Review list of "100 Non-Profit Hospital and Health System CEOs to Know."
Here, Mr. Michalski talks about some of Beaumont's strategies, shares the best career advice he ever received and tells us what he wished he had known before assuming the role of CEO.
Question: What are some of Beaumont's goals and how does it plan to achieve them, particularly in light of the merger discussions with Detroit-based Henry Ford Health System that didn't go through?
Mr. Michalski: We are at an interesting nexus. We just ended merger discussions with a potential partner and now that those discussions have ended, we are going to take some time to look over our strategic plans. Three years ago, we put into place a strategy to become one of the foremost high-value providers in the country, and if you look at University HealthSystem Consortium data, we are listed among the top 10 quality leaders among more than 100 academic medical centers in the country. Our focus on high-value care and performance-based payment is going to continue. We have adopted a model of centers of excellence and clinical integration councils, and they support the platform on which we have achieved excellence in value over the last three years. The centers of excellence and clinical integration councils are physician-led, nurse-partnered and administratively supported, and we did that because physicians and nurses are at the forefront of patient care. We, as administrators, support them.
My philosophy at Beaumont is that you either help a patient or you help someone help a patient. One of the new strategies we have implemented is a partnership with United Physicians to create a clinical integration organization called Beaumont United Care Partners. United Physicians will contract for physician fees and we will contract for facility fees. It will help us achieve better clinical integration. We have also developed a set of strategies that we believe are key to the creation of a model health system. These are:
1. To improve the well-being of the people of Michigan and beyond.
2. To serve as a national model for innovative, efficient, high-value care.
3. To attract and retain the highest quality physicians and employees from a national pool.
4. To attract patients to Michigan for destination medicine.
5. To serve as an engine of innovation and economic development for the region.
Healthcare has never been more interesting than it is right now, and we get a chance to shape it.
Q. What do you think are the biggest challenges facing your organization? How do you plan to overcome them?
GM: One challenge is the reductions in reimbursement. There is going to be less money in the system for everybody. Here's the way we think about overcoming it. It's my belief that if you want to achieve an outcome, you need to put a process in place and then you need to have a structure in place to achieve these outcomes. You need to incorporate processes that reduce variation, and then you need to have the structures to support the processes. This will help lower costs but will keep quality high. Also, to combat reductions in reimbursements while improving quality you need to knit together the patient experience so that it is seamless and flawless. In addition, it is my belief, culture drives behavior, which drives outcome. So to be successful, you also need people who care about treating patients as one individual at a time, with dignity and respect. Both the process track and the behavioral track need to be in place to get consistent reliable results.
Physician shortages are another issue. We started a medical school, the Oakland University William Beaumont School of Medicine. It was Michigan's first new allopathic medical school in 47 years. We attract students from all across the country.
Q: Is there something you wish you had known when you first assumed the role of CEO?
GM: Yes, I wish I had known more about models of governance and more about the political world that we live in. Policy, ultimately, drives how healthcare is delivered and how it is financed. It is important to know how policymakers are making the decisions that affect how healthcare is delivered in the country.
Q: What is the best piece of career advice you've received?
GM: There are three pieces in my case. The first is that the patient should be at the center of the conversation always. The second is that when thinking about career and career aspirations, think two levels above your current level, not one. Basically, you need to think like your boss's boss and not your boss. The last one is built around game theory. Keep in mind that people always know what they want, but they don't know what they don't want. For each of your alternatives in a decision, ask yourself the question, "What is it that I don't want?" Sometimes you will find that you will pick the alternative that is more risky but provides greater benefits and opportunities.
Q: Given the rapid pace of change in the healthcare industry at the moment, what advice do you have for CEOs of other nonprofit hospitals?
GM: Put the patient at the center of all you do, and remember that your job is to support those who care for the patient. Remove barriers that stand in their way. Also, get out of your office and go see what is happening on the front lines. Listen more than you talk.
Q: What excites you most about healthcare right now?
GM: The complexity. I can tell you, complexity of healthcare delivery and financing in America is one of the most challenging endeavors anyone can undertake, and that is what makes it so exciting. It's magnificent and meaningful work that we do because we help people.
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