When John Haupert walks through the doors of the more than century-old Grady Memorial Hospital Monday as its new CEO, it won’t be new territory.
As second in command of a massive public hospital in Texas, he learned the pitfalls all safety net hospitals face -- the overflowing emergency departments, unpredictable funding and need to build strong ties quickly with local leaders.
Industry observers and local leaders say his experience as chief operating officer at Dallas’ Parkland Health & Hospital System – one of the nation’s largest public hospitals – makes him uniquely qualified to steer the troubled Atlanta facility.
Grady is on course to lose $23 million this year following a nearly $20 million cut in government funding to care for the poor and uninsured. It has shed 200-plus jobs and shuttered two neighborhood clinics, among other cost-saving measures.
“He is the right person at the right time to deal with some of the issues that we have with stabilizing Grady,” Fulton County Commission Chairman John Eaves said.
Putting Grady on stable footing by boosting revenue from operations and looking for ways to improve the flow of federal and local dollars will be a key priority, Haupert said Friday.
Haupert's calender is already jam packed. He will meet with commissioners from DeKalb and Fulton counties who decide each year how much money to contribute to Grady for indigent care -roughly $65 million in 2011. The relationship between Grady's board and local leaders has been strained and often contentious in recent years.
“If we’re not listening to the commissioners and citizens of this community and understand their expectations, we’re really failing to live up to our side of the deal,” Haupert said.
As Haupert, 51, takes Grady's reins, hospital officials say they aren't concerned about recent troubles at Parkland where he served as chief operating officer since 2006.
In August, federal regulators threatened to cut off hundreds of millions of dollars in Medicare funding after inspectors found widespread unsanitary conditions and inadequate emergency department screenings put patients at serious risk.
Like hospitals across the country, Parkland’s ER has been inundated by uninsured patients in the wake of the recession. Emergency department visits climbed 21 percent in 2010 to nearly 178,000 and are expected to hit roughly 220,000 this year.
“Parkland found itself having to find ways to move people through the system faster and faster,” Haupert said. “Sometimes you’ll find where people will slip through the cracks.”
Reported cases showed patients weren’t triaged or screened by the book 100 percent of the time, he said. Senior executives weren't aware of some triage issues but are ultimately responsible for the hospital’s operations, Haupert said. Soon after the scathing report from inspectors, Parkland's governing board said it wouldn't renew CEO Ron Anderson’s contract when it expires at the end of the year. He led the hospital for 30 years.
Last week, the health system signed an agreement with federal regulators to hire outside consultants to correct the problems. It's only the fifth hospital, as well as the largest, in the country to enter into such an agreement.
Haupert told Grady’s search committee about the Parkland inspection during the interview process but the results weren't released until after he was hired from among hundreds of applicants, Pete Correll, chairman of Grady’s corporate board said in August. Correll said he spoke with Haupert and Parkland’s CEO about plans to fix the problems. Correll said he doesn't think Haupert bears responsibility for the hospital's troubles.
On his recent visit to Parkland, Eaves found himself impressed by the hospital’s operations at the county jail there – an integrated approach he said might work for Fulton. Eaves added he’s not concerned the recent troubles there will hurt Haupert’s ability to lead Grady.
Parkland is hiring more staff and instituting more intensive ER triage and medical screenings as it deals with crushing demand.
“It’s a real conundrum for this country," Haupert said. "It’s not just Parkland, it’s an everywhere issue.”
A fourth-generation native of Fort Smith, Ark., Haupert grew up surrounded by medical professionals.
His great grandfather, great uncles and other relatives were physicians. His parents were involved with the local Catholic hospital’s board and foundation. In high school, Haupert worked as an orderly during the summer.
“The real catch for me was the combination of using your business education … to serve a greater interest,” he said.
At Parkland, Haupert oversaw the construction of a $1.3 billion, 862-bed replacement hospital, as well as supporting specialty clinics.
At Grady, Haupert said he wants to strengthen its network of community clinics -- focusing on detecting chronic diseases early and intervening with patients before they end up in the hospital. It keeps people healthier and drives down the overall cost of care, he said. He also plans to work with public health departments and other community clinics to build a broader system of care.
Going forward, Grady will have to be more competitive as the health care industry undergoes a fundamental shift, said William Custer, a health care expert at Georgia State University.
Millions more Americans will join the ranks of the insured under the new health care law, which will give patients more options, Custer said. Grady is seen as the hospital of last resort – not necessarily a place people choose to go – and changing that perception takes time, he said.
Safety net hospitals have been overwhelmed and haven’t had the mind set of competing for patients, Haupert said. The focus needs to be on improving patients' experience and developing areas of clinical excellence that can differentiate Grady, such as its new stroke center, he said. Cardiology and urology are two growth areas it's exploring.
Bringing in more revenue is crucial, especially when the federal deficit and states' strained budgets could hurt Grady's level of support, said Bob Holmes, a Fulton-DeKalb Hospital Authority board member. It must work with local leaders and communication is crucial, he said.
In his first couple of months, Haupert said he wants to get a grasp of Grady's relationships with the counties.
"Relationships are key to everything," he said. "We're all in this for one reason, to make sure ... people have the care when they need it."