These are extraordinary times in American Healthcare. Extraordinary times require extraordinary leaders to guide organizations through the turbulent waters. How is R.Edward Howell, CEO of University of Virginia Medical Center, approaching leadership development?
Excerpt from “Stewardship:The Noblest Form of Leadership – Part II,” Compass Clinical Consulting Profile in Healthcare Leadership Interview with University of Virginia Medical Center Chief Executive Officer, R. Edward Howell, by Cary Gutbezahl, MD.
Dr. Cary Gutbezahl (CCC): These are extraordinary times. Extraordinary times require extraordinary leaders to guide organizations through the turbulent waters. How are you approaching leadership development for the Medical Center right now?
R. Edward Howell(REH): The current environment is perhaps the most turbulent in American healthcare history. I haven’t had the experience of all of America’s healthcare history, but this is my 34th year in the industry—25 of which I’ve been a CEO. So, I’ve seen a lot of changes. I don’t know if this is the most turbulent or not, but the rhetoric that describes it has gotten leadership feeling like it’s being buffeted by hurricane-force winds of uncertainty.
This isn’t the first time we’ve had federal legislation that changes our world, but it’s the first time we’ve had legislation that’s created more questions than it has provided answers. So I think that healthcare leaders across our industry are feeling uncertain.
A PERSONAL COMMITMENT TO REINVENTION
We have a responsibility to support the leaders in our organization and give them the skills we think will be needed in the future despite the uncertainty—skills and capabilities that will help them do their jobs better. But skills and capabilities alone won’t cut it. There has to be a personal commitment to the continual reinvention of this organization—and themselves. This rapidly changing environment demands it.
Continual reinvention is challenging; it’s difficult. But ultimately, it’s immensely fulfilling. I’ve reinvented myself four times in my career.
I started in cost-based accounting. I tell my students that when I was in their shoes, we really didn’t have an income statement. We managed according to the expense report. It was all about what you put on the cost report, because if you didn’t identify it as an acceptable cost, you received no reimbursement.
So, borrowing funds was an interesting concept because in reality, there was very little that a rating industry could do to measure an institution’s credit worthiness. I was fortunate to have believed in ratio analysis and benchmarking from the beginning because a professor I had—Bill Cleverly—created the concept of ratio analysis for the hospital world.
I’ve gone from cost-based reimbursement to prospective payment and now to how can we survive under DRGs.
Next it was managed care. The world was going to be ruled by HMOs, and we were all going to be part of a system. Well, I learned to deal with managed care and even learned some of the insurance industry and how important “Incurred But Not Reported” was when you’re accountable for a predetermined payment. This taught me how to work and develop the structures across organizations that are characteristic of a healthcare system.
We’re now at a point where we’ll have to reinvent ourselves once again. I think the concept of collaboration is going to have to be an essential skill for organizations looking into the future.
The answers to the questions are unclear in many regards. The fundamental issues in how we’re delivering healthcare today is “less.” We don’t know quite candidly if we have to deliver more with less, or deliver less with less. But less is the common denominator in either regard.
So, this all-out frenzy to own and control everything when there may not be enough in the environment to make it meaningful to own, means that you have to partner and collaborate.
COLLABORATION IS NOT COOPERATION
A lot of people talk collaboration, but I’m not so sure everybody understands it. It’s not cooperation; cooperation is working together agreeably. Collaboration is working together aggressively, making sure you understand what you are going to do together and what you want to achieve.
As we talk about leadership development within our organization, we have an obligation to give our people the knowledge, skills and mindset to help them reinvent themselves as the healthcare industry changes. This includes intense training on collaborative efforts.
How does this help you prepare for the future?
The real message is that all of us need to be held accountable for what we do.
We have to make sure that the patient is better off and healthier because of what we’ve done. So at UVA, we’re focusing heavily on two items: quality and efficiency.
If we use our resources well, we’ll have a more efficient organization and one that can handle the outcomes that the public is going to increasingly expect.
The question is, will we have our own system of an Accountable Care Organization (ACO) be part of a larger system of an ACO or be multiple parts of a larger organization?
We’re going through a strategic-planning process that will help give us some ground to work on. But as we go into that process—getting back into the concept of stewardship—we do so from a very strong position because of the changes we have already made.
Being able to have the organization deal with challenges from a position of strength is, in my mind, the definition of stewardship.
DOWNLOAD “Stewardship:The Noblest Form of Leadership – Part II,” Compass Clinical Consulting Profile in Healthcare Leadership with University of Virginia Medical Center Chief Executive Officer, R. Edward Howell.