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Leading Through Transformation: Top Healthcare Ceos’ Perspectives on the Future of Healthcare

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Leading Through Transformation: Top Healthcare Ceos’ Perspectives on the Future of Healthcare Leading Through Transformation: Top Healthcare CEOs’ Perspectives on the Future of Healthcare Insights from the Huron Healthcare CEO FORUM Leading Through Transformation: Top Healthcare CEOs’ Perspectives on the Future of Healthcare Insights from the Huron Healthcare CEO FORUM Executive Summary 2 I CEO Visions For the Future of Healthcare: Possibilities, Probabilities, and Preferences 3 II From Vision to Reality: Key Challenges and Opportunities 6 Moving From Volume to Value Changing the Care Delivery Model Physician Relationships Cost Containment III Leading Through Transformation: Evolving Leadership Roles 17 Modeling Optimism and Energy Achieving Corporate Social Engagement Accelerating Talent IV Insights From Outside Healthcare: Lessons in Leadership From Top Executives 24 Insights from Leaders at Motorola Solutions, Baxter International, and McDonald’s Corporation Insights from Aetna Inc. Retired Chairman & CEO Ron Williams Insights from Chicago Board Options Exchange Vice President of Strategic Planning Eric Frait Insights from Lettuce Entertain You Enterprises Founder & Chairman Richard Melman Conclusion 34 Executive Attendees 35 Huron Healthcare CEO FORUM 1 Making crucial, necessary, and fundamental Huron was very pleased to contribute to the changes in an industry of critical importance Forum discussions, and we are now pleased to the country’s economic health requires to provide highlights from those discussions. outstanding leadership. For healthcare CEOs, As a company, we look forward to supporting that challenge also represents a very exciting CEOs and their organizations as they opportunity. That excitement was palpable at envision the future and lead the healthcare this year’s Huron Healthcare CEO Forum. enterprise through unprecedented change. At the Forum, CEOs interacted with each JAMES ROTH other and with guest speakers, collaborating President & CEO to share their best thinking around the Huron Consulting Group healthcare industry’s toughest issues. EXECUTIVE ATTENDEES See full attendee bios on pages 35-37 William K. Atkinson, Nancy A. Formella Alfred G. Stubblefield PhD, MPH, MPA Former President President & CEO President & CEO Mary Hitchcock Memorial Baptist Health Care WakeMed Health & Hospitals Hospital Ray Thompson Marty Bonick, FACHE Dean M. Harrison EVP & COO Vice President of Operations CEO Forum Chair Trinity Mother Frances Community Health Systems President & CEO Health System Northwestern Memorial Marna P. Borgstrom HealthCare Kate Walsh CEO Forum Co-Chair President & CEO President & CEO Mark Laney, MD Boston Medical Center Yale-New Haven Hospital and President & CEO Yale New Haven Health System Heartland Health Guy Wiebking President & CEO Steve Carlson Barbara J. Martin, Provena Health President & CEO MBA, FACHE, BSN Community Medical Center President & CEO Dan Wolterman Vista Health System President & CEO Michael S. Eesley Memorial Hermann CEO Bryan Mills Healthcare System Centegra Health System President & CEO Community Health Network David T. Feinberg, MD, MBA CEO, UCLA Hospital System Christopher T. Olivia, MD President, UCLA Health System SVP, Strategic Planning and Associate Vice Chancellor, New Venture Development UCLA Health Sciences Highmark, Inc. Huron Healthcare CEO FORUM Executive Summary 2 EXECUTIVE SUMMARY Relentless. This was the word that came up again For additional insights on effective leadership and again throughout the two days of discussions and making strategic visions real, CEO attendees heard from top executives who among the nearly 20 top healthcare CEOs in the lead organizations in industries other country who attended Huron Healthcare’s annual CEO than healthcare. The message from those executives was surprisingly consistent: Forum. The need for relentless communication with intellectual honesty, organizational values, stakeholders, from employees to community partners; and communication form the bedrock of strong leadership. In their “back-to-basics” dealing with relentless change; and maintaining advice, these guest speakers shared what core relentless, reality-based optimism about the future leadership competencies look like in action. of the healthcare industry. They also encouraged the CEO attendees to rethink what the future of leadership could look like for the healthcare industry. CEO attendees at the Forum represented a broad range of organizations, from Leadership imperatives the executives larger multi-hospital systems to smaller discussed included: community hospitals, across urban and rural KEY OPPORTUNITIES AND communities. Each one is on its own unique » Modeling Optimism and Energy: Protecting CHALLENGES DISCUSSED: path to achieving the imperatives of delivering Stakeholders from “Future Shock” » Moving From Volume to Value: high quality, affordable care, operating on Making the New Healthcare different timelines with different strengths. » Achieving Corporate Social Engagement: Business Model a Reality Communicating to Inspire and Engage Drawing on their diverse experiences, CEO » Changing the Care Delivery Model: attendees shared their visions for the future Accelerating Talent: Cultivating New Leaders Re-imagining the Who, What, When, » of the industry—as well as the challenges Where, and How of Delivering Care they face in making those visions a reality. Using the burning platform of federal and » Physician Relationships: Frank discussions of what’s working and not market reform as a catalyst to do the hard Imperatives for Achieving Alignment working led to useful insights and new ideas. work that remains to be done provides the chance, as one CEO said, to “fix 99 » Cost Containment: Despite the pronounced variability in percent of the dumb stuff we’ve done.” The Coping With Significantly Reduced visions, methods and timing for moving their prevailing mood among CEOs was one of Reimbursement Rates organizations forward, CEO attendees agreed: renewed determination and resolve in their strong leadership will be essential to guide efforts to transform healthcare delivery healthcare organizations through this time of at their organizations to the benefit of the deep uncertainty and tumultuous change. communities they serve—and the country as a whole. CEO Visions For the Future of Healthcare: I Possibilities, Probabilities, and Preferences “Providers are working hard to make progress on the kinds of fundamental quality and cost improvements that need to happen. Leadership skills to achieve this are going to be crucial. Keeping everyone energized around this core vision and making it real is a major challenge, but one that GORDON MOUNTFORD Executive Vice President we’re seeing healthcare leaders stepping up to meet.” Huron Healthcare CEO Visions For The Future Of Healthcare 4 POSSIBILITIES, PROBABILITIES, AND PREFERENCES At the Forum, CEOs shared their visions for the future of the healthcare industry and where they believe their organizations need to go. They also shared the challenges they face in transitioning their organizations from the fee-for-service model they’re working within now, to the future state of value-based healthcare in which they’ll need to provide more affordable, higher quality care at lower reimbursement rates—probably under a fixed or bundled payment model. Moving from the current state to this future state would be a big enough challenge for “We have no ability to predict the hospital CEOs. However, the burning platform future. We have to be successful that’s driving the need for accelerated, regardless of external forces. We want fundamental change is the volatility and to be a market maker, not a reactor.” uncertainty of the current economic climate. – David Feinberg In fact, the CEOs agreed the only certainties over the next five years will be the flat “No one knows if the Accountable growth or decline of the U.S. economy, and Care Act (ACA) will be thrown out. It the continued erosion of reimbursement for probably will survive in some altered healthcare providers. fashion. Reform is not going away.” – Mark Laney Making strategic decisions within this state of limbo—one business model going away “Regardless of what happens with the ACA, and the other not yet here—is, as many we are facing decreased reimbursements CEOs noted, extremely difficult. In response, over time. There will be definite reductions in some CEOs are leading their organizations Medicare and Medicaid because current rates boldly into the uncharted territory of the new are unsustainable with the growing number business model, while others are moving of elderly benefactors. Current policy is just ahead at a more cautious pace. But there kicking the budget can down the road.” was no one at the event who thought that – Michael Eesley the current model would be sustainable in the future. 5 Regardless of attitudes or predictions “Adding more patient volume at Medicaid “We have a lot of opportunity to fix 99 about the ACA, there was broad rates will not alleviate the shortfall caused percent of the dumb stuff we’ve done. agreement that the goals of the federal by these rates not adequately covering the We have the chance to do it right. If it and private sector healthcare reform full cost associated with the services were easy, I wouldn’t want to do it. I signed efforts—driving down cost and improving provided in most cases.” on for heavy lifting.” quality—are creating a burning platform – Guy Wiebking – William Atkinson for change. And yet, CEOs are clearly troubled by the nation’s inability to Other CEOs expressed concern about the “People look at healthcare
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