Lassiter takes reins as CEO of Henry Ford Health System
Wright Lassiter III believes his first two years as president of Henry Ford Health System have been especially noteworthy with the number of deals finalized and several quality and financial achievements on the books.
But he is certain the future for Henry Ford holds even greater promises with ongoing plans underway as he takes over as CEO of the Detroit-based system, succeeding Nancy Schlichting, who officially retired Dec. 31 after 18 years with Henry Ford.
In an interview with Crain’s during the closing days of 2016, Lassiter said Henry Ford has closed on deals since he has arrived to acquire Allegiance Health in Jackson and the commercial business of HealthPlus of Michigan in Flint. Those acquisitions pushed Henry Ford’s total annual revenue above the $5.5 billion mark, the highest among Southeast Michigan-based systems.
Henry Ford also last year affiliated with a 33-hospital statewide clinically integrated network, Affirmant Health Partners, that will give its insurance arm, Health Alliance Plan, much greater geographic coverage toward its goal of taking care of 500,000 patients by HAP and its integrated delivery system. Moreover, Henry Ford has improved quality and patient safety scores, expanded personalized cancer medicine, boosted financial performance and hit record totals for research grants.
Lassiter, who for the first time this year made Modern Healthcare’s list of the 100 Most Influential People , believes this is just a start for Henry Ford to fully capitalize on its portfolio that also includes six hospitals, more than 32 outpatient medical centers and a 1,100-physician employed medical group.
After spending nine years as CEO at Alameda Health System in Oakland, Calif., Lassiter, 53, came to Henry Ford on Dec. 15, 2014, as part of a nontraditional two-year plan to succeed Schlichting.
“I’ve had a couple years to be in the organization and spent some of that time with Nancy. I’ve told a lot of people, ‘I don’t see the transition as dark as some people are see it,'” he said. “The transition process allowed Nancy to do some things (chair the VA Commission on Care) and for us to move forward on a number of areas.”
Lassiter said he, Schlichting and the board had a lot of conversations about expansion and growth, and he has plans to make those goals happen over the next several years.
“I am am excited about the partnerships we formed with Allegiance and HealthPlus. It expands us into new communities. We will look for new communities where partnerships make sense and leverages our strengths,” he said.
Sandy Pierce, board chairman of Henry Ford, said Lassiter has already made his mark within the system and community it serves.
“During the past two years, our system board has had the pleasure to work with Wright and has found him to be a creative and compassionate leader with the right skills and experience to lead Henry Ford into our second century,” Pierce said in a statement. “Wright engaged actively with our community from the start and has a deep passion for our city’s history, culture and determination to rebound.”
Lassiter said other projects he has been involved with over the past two years have flown somewhat under the radar, given the high-profile nature of the Allegiance and HealthPlus acquisitions.
“We had a banner year with research grants, up over $77 million, the highest ever,” he said. “We are excited about our long legacy on quality and patient safety and I am focusing on this to further raise the bar.”
Over the past several months, Lassiter has been encouraging Henry Ford executives, physicians and staff to turn the system into what is called a “high reliability organization.”
He said he wants Henry Ford to take the next leap in quality beyond its 2011 selection for the Malcolm Baldrige National Quality Award and its No Harm Campaign, begun in 2005, to reduce medical errors.
“A high reliability organization is both a science and an outcome that you see most frequently see in the nuclear power, chemical manufacturing and aeronautical engineering fields,” he said. “Those industries avoid serious safety events and you see much less errors in those organizations. We want a training methodology and to adopt behaviors that I believe will further reduce preventable errors to a goal of zero.”
For example, Lassiter recently attended a daily safety huddle at Henry Ford Wyandotte Hospital that has been replicated at each of Henry Ford’s operating units.
“We have clinical and administrative leaders come together for 15 minutes to go through a regimen where we talk about the process from ER to admissions …. we talk about how many days we have gone without a patient harm event or an employee injury. This drives improved quality and financial performance.”
During the past two years, Henry Ford has had a 52 percent improvement in hospital acquired conditions, a 44 percent reduction in urine infections, a 12 percent reduction in readmissions and a 25 percent reduction in surgical complications, said Michelle Schreiber, M.D., the system’s chief quality officer.
Henry Ford also has improved its bond rating with S&P Global Ratings to “A” with stable outlook and with Moody’s Investor Services from stable to positive while maintaining its “A3” rating.
Another goal that Henry Ford began to implement the past two years is its plan to turn HAP into a statewide health insurance organization to integrate care and coverage.
“We want to leverage HAP as a strategic resource,” Lassiter said. “I take some significant credit for that. When I got here I asked if we are leveraging our current assets sufficiently. We have HAP and our members get care at Henry Ford hospitals and we have the Henry Ford Medical Group. Why not do more of it?”
But Lassiter said developing a statewide financing and delivery network does not mean owning a string of hospitals and physician offices across Michigan.
“HAP can’t achieve that on its own. I don’t see HAP across the state. We do it in a tightly aligned way,” Lassiter said. “It starts with the merger of Allegiance and Henry Ford. That’s a positive for HAP. Now we have a new delivery area with doctors practicing at Henry Ford, getting labs, X-rays, ambulatory surgery and go to Allegiance for Jackson (for inpatient care).”
To go statewide, Henry Ford last year signed on to join Affirmant Health Partners, which includes many of the state’s leading regional health systems and more than 6,000 physicians. They include Spectrum Health in Grand Rapids, Sparrow Health in Lansing, Bronson Healthcare in Kalamazoo, MidMichigan Health in Midland, Covenant HealthCare in Saginaw and Lakeland Health in St. Joseph.
“We are just trying to understand how to best leverage of member institutions to deliver innovative products in the markets,” said Lassiter, adding he expects Henry Ford to announce at least one managed care deal with an Affirmant partner this year.
Asked about whether Henry Ford is negotiating a partnership or affiliation with Kaiser Permanente, as Crain’s has previously reported, Lassiter declined comment. He suggested that because nothing has come out after one year, maybe there isn’t anything to the talks.
However, Crain’s continues to confirm on background with sources within Henry Ford and experts in Southeast Michigan that talks are ongoing between the two health organizations, which share very similar operating cultures.
“I’ve known the Kaiser CEO (Bernard Tyson) for more than a decade. Henry Ford and Kaiser executives have close relations and talk regularly” about health care trends and the industry, said Lassiter, declining to confirm or deny merger or affiliation talks.
But Lassiter did say he envisions more hospital acquisitions or joint ventures between Henry Ford and others in 2017.
“That would not surprise me. We continue to be open for discussions around broadening the footprint around (Henry Ford) services,” he said. “The chance is better than 50 percent. We continue to be open to deals, not just to be bigger and bigger, but to serve broader geographies.”
On the possibility that Henry Ford might forge a larger contract and relationship with Wayne State University School of Medicine, as several Crain’s sources have suggested, Lassiter said he hopes that happens in the future.
“We have had a long-standing relationship with Wayne State and medical education is quite important to it. My goal is we are very disciplined to partnerships to achieve those goals,” he said. “We are constantly working with Wayne State about other models that make sense. I remain open to that.”
Lassiter said he believes Henry Ford and Wayne State share similar goals and compatible cultures. “What would make sense to maximize our goals?” he asked. “We have the same goals for allieds and medical students, academics and research interests.”
On the pending decision by the Detroit Pistons to choose a medical provider for team sports medicine services, Lassiter said he expects the Pistons to decide during the first quarter of the year. Henry Ford and Detroit Medical Center are vying for the contract.
“We both have been approached by the Pistons to have team physician and sports medicine services,” he said. “We already work with the Lions and the Tigers for concierge medicine coverage.”
Lassiter also said he has had a positive experience during his two years at Henry Ford in learning about the employees and health care delivery and financing systems in Michigan.
“There are similarities and differences between Detroit and Oakland (his last job),” he said. “I have been surprised there is greater diversity here than I expected. Oakland and the (San Francisco) Bay Area is touted as melting pot of different languages. I expected some of that here, but I didn’t fully appreciate that until I arrived. The cultures: some remain separate and some have merged.”
Lassiter said Oakland always plays second fiddle to San Francisco. “I feel Detroit and Oakland don’t get the respect they deserve. … That creates a resistance and toughness, but both communities are welcoming of outsiders.”
One of the biggest surprises he has experienced at Henry Ford is the asset that is Henry Ford Medical Group and how it drives quality throughout the system and works well with independent doctors.
“We have a strong group of employed physicians, but we have a large group of nonemployed doctors. This makes the medical group much broader than it actually is” on its own, Lassiter said. “It causes one to make sure you think (strategically) in a way that supports that reality.”
“Wright Lassiter III formally takes helm as president and CEO of Henry Ford Health System” originally appeared in Crain’s Detroit Business.