From Supply Chains To Hospital Systems: How Two All-Star CEOs Are Leading The Way Through Resilience And Innovation

Even if you’ve never been tempted to predict the future before, 2021 might be the year we all would invest in a good crystal ball. I believe the healthcare industry has been approaching a tipping point for some time now, but the pandemic has left us with no choice but change. We cannot carry on with our old ways of doing things.

In trying to figure out what the future holds for healthcare, I recently sat down with two leading healthcare executives who have effectively led their organizations through the pandemic, and used this challenge as a time to learn, innovate, and pioneer new ways forward.

Rod Hochman is President and CEO of Providence, the third largest health system in the US with 51 hospitals in seven states, and the 2021 Chair of the American Hospital Association. Susan DeVore is CEO of Premier, a healthcare performance improvement company serving more than 4,100 hospitals and health centers with clinical, financial, and safety data for 45% of the patients in the country.

Pandemic Preparedness

Both Hochman and DeVore have weathered the pandemic with their eyes open to where it amplified existing weaknesses in the healthcare system as well as revealed new issues that we must address in 2021 and beyond.

In her post as CEO of Premier, DeVore sits at the nexus of healthcare data, supply chain, health systems, providers’ needs, policy changes, and future payment models. She saw the weaknesses in our supply chains well before Covid-19 hit: “Years and years ago, we said if there’s ever a problem in China and we cannot get PPE out of China and Southeast Asia to America with any kind of epidemic or pandemic, we have a serious problem,” DeVore recounted. “And so we, about 10 years ago, actually started our own direct sourcing company to try to diversity the sources of product. We were so thankful we had that direct sourcing company when the pandemic hit, because we were able to help.”

Very early in the pandemic DeVore and her team reached out to federal agencies as well as supply manufacturers and distributors.

“We said, ‘Let’s form a public-private coalition… Let’s share information with our federal partners; let’s share information with each other. Basically for the last 10 months we’ve been collaborating as a group and trying to figure out what was needed, where it was needed, how to get it there faster,” she told me. “I think it’s been actually one of the big wins out of the pandemic: the ability for fierce competitors to work together when we had a worldwide pandemic.”

Hochman agreed. “Collaboration has never been better!” he said. “In less than a year, look what we’ve learned about this disease. And we’ve done it through the collaboration of scientists, technologists figuring out what we need to do next.”

Hochman proposed that the collaborative spirit he’s seen this year within his own hospital system as well as the larger medical and scientific community should be a pattern for attacking the challenges we have in public health beyond the current pandemic.

“Why don’t we use that same model as we move forward?” he said. “How do we collaborate in such a way that we can bring all of that to bear everywhere?

Healthcare System Priorities

Our healthcare system certainly does have big problems that will take a cooperative approach, so I asked them where their priorities lie.

In his role as the 2021 chair of the American Hospital Association, Hochman has the responsibility of helping set the AHA’s agenda for the year. COVID-19 will certainly continue to be top of mind for the organization, particularly developing membership unity around the vaccine program. After that, Hochman said, his priorities are affordability in healthcare: “How does the provider side of healthcare—doctors, nurses, hospitals—survive through the financial turmoil that’s going on.” Providing a basic level of care: “How do we provide primary care or some safety net of care for all Americans in a way that doesn’t bankrupt the country?” And finally, rural healthcare: “We can’t let rural healthcare fall on its face, and never have we been more worried about it than now.”

Here in Tennessee, we have lost many of our rural hospitals, and I’ve been concerned about this trend as well. Providence serves patients and caregivers in remote areas of Alaska, Montana, and New Mexico, so Hochman knows rural health issues well. I asked what he’s learning about rural health that helps frame next steps.

Rural healthcare does not just describe one type of problem, Hochman pointed out. These are a very heterogeneous group of hospitals. “Obviously virtual health will help considerably,” Hochman said, and he advocated for affiliations and associations with larger systems so that the rural hospitals have access to support when needed. “They don’t need to take them over, but [partner in some way] to get the ability to have those specialists on the line.”

But while Hochman was quick to point out that telehealth is here to stay, he didn’t gloss over the practical logistics facing rural health. “We’ve got to figure out… how many beds makes sense in a rural environment? What does the transportation system look like? If you’re 200 miles away in West Texas from the next hospital, you had better think through the transportation system that’s going to get that patient to the place where they need to be. I don’t think we’ve put enough time into how we triage and transport and make sure those patients get cared for.”

Planning for the Future

Hochman emphasized that we also need to be thinking, “What happens after Covid?” He said that as soon as the pandemic started, he put together a “2025 group” at Providence “to figure out where we’re going to land in healthcare in 2025.”

DeVore has outlined projects and priorities for Premier as well. In fact, she recently posted a very thoughtful blog in Health Affairs about the five trends to watch in 2021. Unsurprisingly, she’s particularly concerned about our medical supply chain. “The number one problem is dependence on any one part of the world for critical products,” she said. “You need to diversify. You need to have some [suppliers] in the US. You don’t need it all in the US—that’s also a risk—but some onshore, some nearshore, some offshore, and you’ve got to find ways to develop those products efficiently.”

But DeVore also highlighted issues of our public health infrastructure, our long-term need for telemedicine, and the maternal and infant mortality rate as crucial in 2021.

I’m particularly heartened to hear her flag maternal and infant mortality. About ten years ago, the Robert Wood Johnson Foundation began ranking individual counties on several health indicators. I remember sitting in the board meeting when the first rankings were shared and seeing Davidson County’s maternal and infant mortality ranking. My response: “Are you kidding me? How embarrassing!” I came home to Nashville from that trip and started NashvilleHealth, a collaborative health movement to build and advance partnerships and initiatives that tackle Nashville’s most critical health challenges. Unfortunately, maternal and infant mortality falls on that list.

Any solution must start, DeVore said, with better data. “Everybody measures this in a different way. There’s no standard measurement. The data exists maybe in a hospital setting; it doesn’t exist in an ambulatory setting,” DeVore said. Even in the hospital setting, she said, “we have data on the mother, not so much data on the baby.”

Premier is working with United States Department of Health and Human Services to combine mother and child data from various health systems, focusing on those serving the most vulnerable populations, and try to understand the problems more deeply and measure the progress. DeVore is hopeful. “We’ve learned from so many of our collaboratives, the minute you start measuring something, improvements start immediately,” she said.

Gender Equality in Healthcare Leadership

In addition to spotlighting weaknesses in our health systems, the pandemic has had a regressive impact on gender equality. A July 2020 report by McKinsey & Company found that “women’s jobs are 1.8 times more vulnerable to this crisis than men’s jobs,” in part because “the virus is significantly increasing the burden of unpaid care, which is disproportionately carried by women.”

Both Hochman and DeVore emphasized the positive impact of having women in leadership roles in their companies, and how they are being proactive in advancing workplace diversity.

Hochman kicked off our discussion by sharing a story he’s fond of recounting: “When I’m on Wall Street, I always have a question for all the analysts. I say, ‘Name another 170-year-old company, that’s worth $26 billion, that was started by a group of women.’ And that was the Sisters of Providence that landed in Vancouver, Washington with nothing… It’s a great American story about how things get built, how they get done, and it’s reach – we cover about 10 million patients every year.”

DeVore shared that, “I think across all of healthcare … 14% of the senior leadership teams are women and only 4% are CEOs.” Premier is intentional in its efforts to support the growth of women, in part because, “women add all kinds of different perspectives and diverse ideas and experiences, [that] only benefit companies. If you look at ROE [return on equity] or return on assets or profitability, and you go look at what percentage of the companies actually have significant number of women in leadership, they perform better. And it’s not because they’re women, it’s because it’s just different perspectives and experiences and capabilities.”

DeVore, who has consistently been named to Modern Healthcare’s 100 Most Influential People and Top 25 Women in Healthcare lists, said her advice to women was, “you have to break out of the box, jump off that cliff and go for it. And not wait for somebody to give you the opportunity necessarily.”

As my friend former Denver Health CEO Dr. Patricia Gabow recounted in her new book, Time’s Now for Women Healthcare Leaders, “There is a growing body of data that women do bring different skills to leadership. Women make teams function better and they produce better outcomes in a variety of dimensions. These differences matter.”

On Leadership

I closed my discussion with each delving into leadership – wondering what helped guide them in running multi-billion dollar organizations during a time of unique industry turmoil. Hochman cited mentorship as key to his growth, something he and I agreed was ingrained in the process of training to be a physician. “I still have mentors that I call up and say, okay what do you think?” he remarked.

DeVore reflected on the importance of being present: “If you live in the moment, if you are constantly learning and love to learn, if you view the world as anything is possible, and you really conduct yourself in a way that you can be proud of in the light and the dark, I think it comes to you. The ideas come, the people come, the strategies come.”