On May 1, Susan Fox, R.N., MBA, took over as CEO at 292-bed White Plains Hospital, serving Westchester County north of New York City. In the works for five years and announced last year, the smooth transition of leadership from retiring CEO Jon B. Schandler is a case study in effective succession planning.
Yet, the organization Fox will lead, and the future she will lead it into, are very different from those her predecessor inherited 38 years ago. And Fox is a very different CEO — by design.
For most of Schandler’s 38 years at the helm, White Plains thrived as an independent community hospital. With his background in public accounting and hospital operations, he built strong operating margins and a solid capital base at White Plains, even though many patients left the county for such advanced services as spine surgery and cancer care.
Today under Fox, White Plains is transformed into a tertiary referral center in the Montefiore Health System. With her background in physician network development and management, and clinical quality and process management, she has improved care efficiency and quality, enabling the introduction of higher margin, higher acuity services and profitable pay-for-performance contracts with every major payer. White Plains now provides advanced inpatient cardiac, orthopedic and cancer services that are fully integrated with physician office, home care, rehab, long-term care and other community services.
The story powerfully illustrates many of the urgent challenges hospital CEOs face today, and highlights the experience, skills and personal qualities needed to successfully address them. “The CEO of the future will be someone who understands the continuum of care, from inpatient to physician offices to ancillary services to home health, pharmacy and nursing homes, and is capable of bundling it all around providing excellent service at reduced cost,” says Tom Giella, managing director, health care services, for executive recruiter Korn Ferry in its Chicago office.
Indeed, the growing demands of population health management and accountable care appear to be major factors driving CEO turnover rates to record highs — breaking 20 percent for the first time in 2013 and averaging more than 17 percent over the past five years.
“The continuing trend of consolidation among organizations, the increasing demands on chief executives to lead in a complex and rapidly changing environment, and the retirement of leaders from the baby boomer era may all be contributing to this continuing higher level of change in the senior leadership of hospitals,” says Deborah J. Bowen, president and CEO of the American College of Healthcare Executives, which conducts annual CEO surveys. “The findings also serve as a reminder for health care organizations to continue to ensure they have appropriate strategies in place — including robust succession planning — to successfully manage senior leadership changes.”
For CEOs starting today, as well as those in midcareer, new skills, experiences and personal qualities will be needed to succeed, says Giella. “You can’t just crank out inpatient care and expect to be paid on discounted fee for service. That still works now, but if you have 10, 15 or 20 years to go, you need to adapt to the new model.”