In finding their spouse, many people claim to have found their "better half" — someone who complements their strengths and weaknesses. And perhaps there is no better term to describe the merger between Hackensack University Health Network and Meridian Health in New Jersey, which became final Tuesday after it received legal approval.
The two systems brought complementary strengths to the table when they signed a definitive agreement to merge in 2015: Hackensack brought academic strength, plans to open a private medical school with South Orange, N.J.-based Seton Hall University and a highly recognized academic medical center in Hackensack University Medical Center; Meridian boasted a large integrated network of hospitals and ambulatory care services, in addition to experience in population health and accountable care.
In what seems to be a merger of equals, both systems also brought long-time leaders into the merger — Robert Garrett, president and CEO of HUHN, and John Lloyd, president and CEO of Meridian Health. Both have been with their organizations for roughly 30 years.
When both of the organizations' respective boards wanted their leader to be chief executive of Hackensack Meridian Health, they decided to embark in a rare relationship: become co-CEOs.
Mr. Lloyd and Mr. Garrett will both serve as CEO of Hackensack Meridian Health for two and a half years, until Mr. Lloyd transitions out upon his retirement and Mr. Garrett assumes sole leadership of the combined network, which boasts nearly 28,000 employees and over 4,000 licensed beds.
On Friday, Mr. Lloyd and Mr. Garrett sat down with members of the Becker's editorial team to share why they believe the co-leadership model will work for Hackensack Meridian Health, talk about why they're taking a road trip across New Jersey and give tips for other hospital leaders navigating through a merger.
Note: This conversation has been edited for length and clarity.
Question: How do you see the co-CEO model working?
John Lloyd: Early on, we took a blank piece of paper, and each of us put down what we thought we should do and what we thought the other person should do. People said, 'What are you doing?' And I told them, 'Well, you didn't hear the results.' We took a blank piece of paper and turned them over and it was a 90 percent match. I rest my case.
Bob Garrett: We couldn't believe it when we saw it.
JL: If you think about it, we have different strengths. How do you think we divided it up? Hello! In other words, I'm going to oversee all the nonhospital businesses, I'm going to oversee population health and be involved in the foundations. And Bob has physician enterprises, the medical school and the hospitals.
BG: We actually put that down. I put down those three divisions for John and those three for me and he did the same. It was like, wow…
Why we strongly believe it's going to work, is, first of all, we've known each other a long time and we know that we can work together. Second, that sheet of paper tells it all, because we each really excel in different areas of the enterprise. We'll learn from each other, but I think it's going to be a great division of responsibility, and we'll work together to make sure Hackensack Meridian Health in its entirety becomes not only transformational for New Jersey, but really a leader for the country. There are so many elements here that I don't think a lot of health systems or networks have today.
Q: Are you sharing an office?
BG: No. Let's not go too far. [Laughter] The offices will be close.
Q: What led to the co-CEO format?
JL: Bob's board wanted him to be CEO of the entity, and my board wanted me. So, you have two choices. You either work something out or you separate.
BG: The other thing about the co-CEO model and why I think this one in particular is important is because of the emphasis on integration. We're going to be co-CEOs for two and a half years, and what do you do in those first years besides run your business? You're going to be involved in continuing the integration of these two organizations into one. And because we're both long incumbents in our respective organizations, who knows those organizations better than we do? [John] knows Meridian like the back of his hand, and I know Hackensack like the back of my hand. That's going to be a huge advantage. Keeping that continuity in place as we're integrating is going to be really really important. It actually has fallen very nicely into place.
Q: What's your first plan of action after day one of the official merger?
JL: We will go to about 25 different [network] locations and we will spend time sharing information with our team members, our leaders and physicians and it's going to be pretty much nonstop, early in the morning through the evening.
BG: After the first week, the priorities will be carrying out the hard work the steering teams have put in; to really start executing [the integration initiatives]. Because up to the point where you become a legal entity, you can do a lot of planning, but you can't execute. So we're going to start to carry out a lot of those plans. There are some great new initiatives in our market that we're able to get to once we're a new entity. There are opportunities to grow and form new partnerships, and that will be one area we will explore as well.
Q: Why did you think it was important to go on the road and meet with people during the first week?
JL: It's our culture. We've been…constantly communicating, written or in person. Yesterday, I was serving hot dogs in our corporate offices, even though I was supposed to be working on the merger. That's just us. [Bob] goes to all of his service awards, we do that, each of our hospitals usually has a Christmas party or whatever; invariably we're out talking to staff, giving updates. That's just the culture. It's a big commitment. We could find a zillion excuses as to why we can't make visits across the system that week. But literally the whole week is blocked out.
BG: The other piece with that is the backbone of our organization is going to be the people. It's about the team members and the doctors, and we have to engage them early on. They have to feel it; they have to understand what Hackensack Meridian Health is all about, what our priorities are, what our goals are, and they have to feel good about it. The best way we believe they can feel good about it and get the information across is if we personally are right there on the front lines meeting and greeting…
We'll also engage communities and community leaders. We want to be good corporate citizens, we're part of the community, and I think that we, John and I, are very visible at the beginning. We represent the face of this new organization; they have to see us. It's a lot of time, it's a lot of miles travelled, but it's going to be a great investment.
JL: We also made a video. We have 28,000 team members, and there's no way we can get to all of them physically, so we'll roll out a video.
Q: One last question for you both. If you could give a piece of advice to hospital executives going through a similar merger, what piece of advice would you give them?
BG: Mine is two-fold. One is get the most difficult questions out first; get them on the table. Don't wait until the end. Who's going to be the CEO, how's the board structure going to be aligned, how is the medical staff going to work — all the stuff that's going to be difficult, don't put it off too long. It's better to get it on the table, even if there's going to be disagreements at first; work them out early on. It really sets the expectation for a good partnership and relationship.
The other advice is get focused on integration early on as well. Don't underestimate the task of what it will take to integrate the organizations. Don't underestimate how important integration is. There are so many examples out there of merged health systems not working because they really aren't truly integrated.
JL: The thing I can add to that would be complete transparency and communication. You can't over-communicate. We put out a little magazine every month, telling updates about the merger. If the word is out that there's some issue going on, you deal with it. Don't defer your issues and problems. Tackle them and have complete transparency and communication.
BG: Communication to team members and also to trustees and medical staff is really important. A lot of rumors get out there, and physicians might feel threatened by a merger…you can really shut a lot of that down early on by really communicating.