Executive Dialogue: Interview with Catholic Health CEO Joseph McDonald

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June 24, 2014

Joseph D. McDonald, President and CEO, Catholic Health

Catholic Health President and CEO Joseph McDonald was part of a panel discussion for Hospitals & Health Networks, a magazine for hospital and health system executives. Click here to read the entire article, or see his responses below.

We're experiencing a great deal of innovation in care delivery in the form of accountable care organizations and bundled payments, among other things. From your perspective, what are the most promising innovations you've seen in your organizations in the last couple of years?

Catholic Health is a different animal in some ways. We've only been a system since 1998 and I joined the organization in 2003. Like many organizations, we've redesigned ourselves. Our world is built around regional growth, partnerships, and physician and service alignment. We worked hard at getting each organization to let go of its prior viewpoints so they all could see themselves as one organization. We invested heavily in technology. And we engaged employees from all sides to help build the new organization. We have talent. Western New York is a proud area, and we had to develop a level of confidence within the organization and the medical staff.

Our medical staff used to complain that it was difficult to attract people to the area. It was important to change that mindset so that we could sell it. We decided to transition several physician hospital organizations into one large independent practice association. We have about 1,000 now that are clinically integrated. We have about 80 employed physicians who are devoted to mission areas. We have very strong collaboration between our leadership and the IPA, as well as with our payers. The payer part may sound like a bit of a contradiction, but we can demonstrate our clinical performance so it makes sense for them to partner with us.

What are some of the more significant technological innovations that you are seeing today?

The challenge we face is leveraging the new. We need to make purposeful decisions about how we are going to invest our energy around new innovations. We have to be careful not to overwhelm everyone. That takes some criteria: Why do we adopt certain things and not others? How much change tolerance does the organization have? That's the key calibration issue that CEOs have to look at. What's the risk tolerance of the organization right now? How much progress can we make? It's usually more than we think. We have to be respectful of their bandwidth and their intellectual ability to deal with change. Their big fear is that every time I go away to a conference, I come back with a new agenda item. That's a challenge we all probably face.

How have you fostered a culture of innovation with your organizations?

Well, there are thousands of consultants who want to take you through a cultural enterprise. I'm sure there's a place for that, but I also believe culture is built by actually doing the work. You can't just sit back and think of the nuances. You have to focus on what's important and figure out how to bring the best focus and attention to it. Success breeds a positive culture.

One thing we all need to understand is that everything we do is not going to work. We need to have a culture that's willing to try new things and learn from them, whether or not we're successful. The da Vinci mole program didn't really take off as we thought it would.

I want to get back to the concept that it's OK to fail. One of the challenges we have in health care is that we are afraid to fail. How do we overcome that?

We have to be transparent with both our successes and failures. Otherwise, we will lose the opportunity to learn from them. That's part of the culture, too. If we have a suboptimal outcome, we have to put it on the table and talk about it. Where did the system break down? What can we do differently?

I like the paradigm of demonstration projects: We believe this is a way to move from here to there. It helps us to understand what we're trying to do. And we can't focus simply on the accomplishment. We need sustainable improvement.

How can we involve patients or other stakeholders in innovation? We hear a great deal about where we need to go, but our communities are not necessarily ready for this type of innovation. What are you doing to involve your patients and communities in this innovation?

We put care coordinators in all of our physician offices. Their focus is chronic disease management. They follow up with patients to ensure that their lab tests have been done. They also make sure patients are filling their medications. I think that's innovative.

Health care is local. What do you see in your own market that excites you?

The thing I'm excited about, frankly, is that young people are coming into health care with excitement, energy and the ability to accept new challenges in front of them. They will have a wealth of technology at their fingertips that we didn't when we started out. They'll be a smarter, more balanced workforce. I believe their ability to have empathy with their patients is going to be stronger, too.