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Robert Garrett and Hackensack University Health Network are working to redefine healthcare

By Lee Lusardi Connor / Photography by Mindy Best

Ask Robert C. Garrett, president and CEO of Hackensack University Health Network (HackensackUHN), how he has achieved the organization’s tremendous success in recent years, and he’ll praise his colleagues — board members who bring crucial corporate experience, executives who excel at creative strategy. “I feel blessed with a great team,” he says.

But ask some of his executives for the secret of HackensackUHN’s success, and they’ll point to Garrett. “We have a phenomenal CEO who we love, who has hired us to do the right thing by patients,” says Shafiq Rab, M.D., vice president and chief information officer at HackensackUHN’s flagship, Hackensack University Medical Center (HackensackUMC).

“One of his greatest strengths is connecting with the entire organization at all levels,” says Ketul J. Patel, executive vice president and chief strategy and operations officer at HackensackUMC. “He has a very strong ability to get people behind his vision of driving the direction of healthcare in the state of New Jersey.”

That vision is one in which healthcare is no longer centered in hospitals; in which healthcare professionals work as teams over the whole lifecycle of a patient’s care, for better outcomes; in which organizational partnerships boost revenue for all.

Crucially, in an era when so much of the U.S. healthcare discussion is apocalyptic in tone, the folks at HackensackUHN are thinking positive. “Listen, there are issues with some of the legislation that’s come down from Washington, but you know what? You’ve got to deal with it. We turn it on its head and say, how can we leverage the situation to improve things? How do we get to the real-life solution?” Garrett says.

“At the end of the day, the community needs healthcare services, and that’s the business we’re in,” says Robert Glenning, executive vice president and chief financial officer. “We look at it and say, somebody has to figure it out. Why not us?”

“One thing we know is [that] you can’t do it all on your own,” Garrett says. “You need good partners.” Accordingly, since Garrett became president and CEO
in 2009, HackensackUHN has entered into dozens
of alliances and partnerships — with local hospitals, major medical centers, walk-in clinics, urgent care centers and more.

It’s an impressive strategy, but according to Garrett, it’s only one aspect of HackensackUHN’s success. Maintaining the right culture throughout the organization is the other. “I believe that culture trumps strategy, every day,” Garrett says.

Communicating the culture

HackensackUMC rises like a small city off Hackensack’s Prospect Avenue, encompassing the Joseph M. Sanzari Children’s Hospital, the Donna A. Sanzari Women’s Hospital, the Heart and Vascular Hospital, the John Theurer Cancer Center and more.

The buildings and lobbies prominently feature banners and signs proclaiming the hospital’s latest awards. (HackensackUMC’s listing in U.S. News & World Report as the number one hospital in New Jersey and one of the top 30 in the country. National rankings in 11 specialties. A slot on the list of HealthCare’s Most Wired Hospitals. Awards for nursing care, safety, environmental excellence. Even the in-house legal/regulatory department is ranked as the state’s best.)

In the main building is Garrett’s office, adjacent to a handsome conference room in which he holds meetings. Lots and lots of meetings.

“As healthcare gets more complicated, diverse and spread out, communication becomes so much more essential,” he explains. “Like other spread-out organizations, we need to think about ways to communicate so the culture stays intact, people stay informed and team members stay engaged. ”

Garrett has a number of practices for reinforcing the “collaborative, innovative and transparent” culture at HackensackUHN. “I have roundtables with 10 or 12 employees at a time. They can sign up for breakfast, lunch or dinner with me,” he says. “I always learn something.”

At one such roundtable, he learned that a change in cafeteria hours had resulted in a lack of food service for visitors from 8 p.m. to 11 p.m. At another, he learned that employees at one hospital were worried about having to cross a busy intersection with no stoplights or signs. He promptly took action on both issues.

Garrett has similar roundtables with physicians and with board members to allow time for in-depth discussions. “I pick their brains, they pick mine,” he says. He holds regular executive strategy meetings with his executive vice presidents, and team meetings with all vice presidents and EVPs. (The COO runs monthly leadership meetings, which include everybody from first-line supervisors on up.)

To further reinforce the culture, Garrett speaks at every group orientation meeting for new employees. He sends out monthly newsletters that recap the news and events at HackensackUHN, and weekly news clips that cover significant stories about developments in healthcare. The CEO, who began his career at HackensackUMC in 1981, also likes to get out in the hospital and talk to people. Executives who’ve made rounds with him swear he knows everybody’s name.

Recently he learned about a woman who had written a letter to HackensackUMC about a bad experience she’d had as a patient there. He tracked her down and invited her to speak at an offsite meeting with his senior team.

“It was so powerful,” Garrett says. “After she left, I said to the team, ‘If that didn’t move you to make sure we stay focused on patient experience and do even better, you should not be a member of the team here.’

“Thankfully, experiences like that have been few and far between at Hackensack, but they happen and we need to do better. Transparency like that is so important.” Garrett plans to invite the woman to speak to the board of trustees as well.

“One of the things we’re really focused on these days is patient experience,” he says. “We are known for our clinical quality and we’re really proud of that. But today, patients are looking for value in the entire experience, not just clinical, for themselves and their loved ones.”

The pairing-up process

Garrett’s emphasis on culture is equally strong when it comes to choosing business partners for HackensackUHN. “On paper, there are great matches out there, but if you have different cultures, you’re not going to be able to achieve the integration you need to succeed.”

Questions of “fit” begin at the top, Garrett says. “The first thing is, are the boards compatible? Do board members see the future of healthcare the same way?
Are they proponents of the same type of investments?” At the CEO level, top dogs must engage early on in hard conversations about who’ll do what in a partnership or merger.

In some cases, it may be advisable to hire an outside firm to do an objective cultural assessment, Garrett says. “Sometimes two companies want a partnership to work so much that they don’t see they’re not really in alignment.”

Despite potential pitfalls, Garrett sees partnerships and alliances as keys to the future of HackensackUHN, and likely of healthcare in general. “Certainly if you reach a certain scale you’re going to be a more successful healthcare system,” he says. “Some obvious advantages are that you have more clout in purchasing and contracting.

“More important, under a ‘population health management’ scenario — which is where our industry is going — bigger is better because you’re going to be offering products and services more effectively to a greater population.”

Partnership, not ownership

A key to success in collaborations is to be willing to give up some control, Garrett says. “A lot of health systems feel they need to own everything. We don’t.

“You have to understand what your core business is, what your core values are, and focus your limited resources on that. For example, maybe you don’t have to invest a ton of capital in a community hospital when you can partner with one. ”

HackensackUHN did just that, expanding its footprint in Bergen County and into Essex County in two recent major joint ventures with LHP Hospital Group. Mountainside Hospital in Montclair, which had been struggling financially, became HackensackUMC Mountainside in 2012. Pascack Valley Hospital in Westwood, which had closed, reopened as HackensackUMC at Pascack Valley in 2013. In Sept. 2014, HackensackUHN and Palisades Medical Center signed a letter of intent, which will lead to making Palisades a full member of the network and expanding HackensackUHN’s reach into Hudson County.

“These partnerships made sense,” Garrett says. “We can still expand our network and achieve our goal of serving those communities. We have our name on the hospitals and we have a big role in governance. At the same time we preserve capital for academics and research, which are becoming harder to find funding for.”

Similarly, with national retailers like Walgreens and CVS going after the primary care market with convenient walk-in clinics, HackensackUHN might have considered developing its own clinics. Instead, it has chosen to partner with CVS by having HackensackUMC doctors act as medical directors in eight co-branded MinuteClinics in northern New Jersey. HackensackUHN thereby gets its name out into the communities, and it participates in the growing trend of having healthcare take place outside of the walls of a hospital — all without having to invest in facilities.

The kicker? Up to 60 percent of people who use MinuteClinics don’t have a primary care doctor. If they need follow-up care, they can be referred to a HackensackUHN physician.

For all its flexibility, HackensackUHN has one huge non-negotiable in its partnership deals: standards of care. “We have a very strong brand that represents quality, and we take that very seriously,” Garrett says. “Our physician leaders work closely with our partners to make sure the quality of care is up to the standard of Hackensack.

“To that end, although we are a minority owner in our LHP [Hospital Group] deals, governance is shared 50-50, with Hackensack having reserve power. If the quality of care is not up to the standards we hold so dear as a core value, we can actually unilaterally replace the CEO without the partner’s permission. That’s kind of a nuclear option, but it’s in the contract for a reason.”

Inviting the doctors in

HackensackUHN’s partner strategy involves not only other organizations but also bringing individual physicians under the HackensackUHN umbrella. The process often involves educating them on a new way of doing business.

Under new insurance reimbursement models, healthcare providers can no longer rely on the old fee-for-service lifeline. Instead, they’ll be paid on the basis of how well they do at keeping patients healthy. In order to thrive, therefore, healthcare systems and practitioners need to collaborate and coordinate in ways they never had to before, in the areas of wellness, case coordination and patient follow-up. For doctors, partnering with a health system offers a viable business model for this new reality.

Some physicians who were used to operating as sole practitioners were resistant to the concept, Garrett says. “Did we have to cultivate and be very patient with certain groups? Yes. But I think what spoke louder was that we were able to develop a track record, to prove that a hospital could be not a competitor, but a true partner.”

Case in point: The HackensackAlliance ACO, one of the first 27 Accountable Care Organizations nationwide selected to participate in the Medicare Shared Savings Program. “In an ACO, insurance companies are giving you a lump sum of money per population, and you have to manage the care of that population within that sum of dollars,” Garrett explains. “To the extent that you can keep people healthy, keep them on their medication regimen, exercising, making sure their weight is managed, they won’t need hospitalizations. From a financial perspective, you’ll do fine.

“And honestly, I think this is what the nation has needed for a long time — to change the focus from chronic disease management to prevention and wellness.”

In 2012, its first year, the HackensackAlliance ACO saved $9.9 million on 13,000 “Medicare lives,” as the terminology has it. “Under the New Jersey program, half of that money saved goes back to Medicare, and the other half is split between physicians and the hospital. Those results attracted other doctors to come on board,” Garrett says. As of April 2014, Hackensack’s ACO had 575 affiliated physicians covering nearly 40,000 lives.

HackensackUHN’s efforts in population health management get a huge boost from HackensackUMC Fitness & Wellness, Powered by the [New York] Giants. In 2013, HackensackUMC opened the 112,000 square-foot center in Maywood in a partnership with the team. The center — which is also the official fitness and wellness center of the Giants — offers community members state-of-the-art fitness equipment and three salt water fitness pools, as well as centers for breast care, diabetes and integrative medicine. The crossover between fitness and wellness is constant. For example, physical therapists can use the pools for aquatic therapy; diabetes and other patients learn to cook healthier meals in the on-site cooking studio.

The center is also the place where Garrett pursues his own wellness, working out every weekday at 5:30 a.m. — the only time he can spare from a packed schedule. “It’s torture getting up,” he admits. “But once I’m there, I never regret it.”

Thus renewed, he proceeds with the daily task of overseeing the enormously complex issues of providing quality healthcare in a fast-changing, financially challenged field.

Can HackensackUHN’s strategies be applied to fix the U.S. healthcare system as a whole? Garrett is far too diplomatic to make such a bold statement. “I do believe that our strategies are very well focused to address some of the fundamental problems regarding cost and coordination of care,” he says. “We don’t pretend to have all the answers. We learn from our partners.”

But he remains optimistic. “Very soon we’ll be announcing a groundbreaking partnership with Aetna. Could we open our own insurance company? Sure we could, but their sweet spot is running an insurance company and ours is running a healthcare system, so let’s bring both together, with insurer and provider in alignment. That’s where I get excited — partnerships that never existed before, helping to shape the future of healthcare.

“If you can partner on something and still create a great system, why not? It’s not rocket science; in fact, it’s kind of simplistic. But we try to be pragmatic.”  CEO

Lee Lusardi Connor is a freelance writer based in Morris Plains, NJ. Contact us at editorial@smartceo.com

HEALTHCARE WHERE YOU NEED IT

Hackensack University Health Network (HackensackUHN) is the parent company of Hackensack University Medical Center (HackensackUMC), the HackensackUMC Foundation and Hackensack University Medical Group.

With 11,400 employees and gross revenues of $5.35 billion at HackensackUMC alone, HackensackUHN has a big and growing footprint in New Jersey as well as in neighboring states. Here’s a partial list of recent strategic, clinical and academic affiliations:

  • A corporate joint venture partnership with the LHP Hospital Group in ownership of Pascack Valley and Mountainside Hospitals
  • A letter of intent that will make Palisades Medical Center a full member of the HackensackUHN network
  • A partnership with CityMD to open urgent care centers in northern New Jersey
  • Academic affiliations with Georgetown University School of Medicine, Rutgers Medical School, George’s University School of Medicine in Grenada, and Stevens Institute of Technology in Hoboken
  • A collaboration with Horizon Blue Cross Blue Shield of New Jersey in an Accountable Care Organization (ACO)
  • Participation in Allspire Health Partners, an alliance of seven regional hospital systems with specific goals for patient care and affordable healthcare
  • An agreement for HackensackUMC doctors to serve as medical directors at eight walk-in MinuteClinics at CVS stores in northern New Jersey
  • A strategic alliance with North Shore-LIJ Health System to explore joint programs and initiatives
  • A collaboration between NYU Langone Medical Center’s Division of Pediatric Surgery and HackensackUMC’s Joseph M. Sanzari Children’s Hospital
  • A partnership with the New York Giants in a charitable organization and in a state-of-the-art fitness and wellness center
  • A partnership to provide medical treatment to the New York Red Bulls professional soccer team, with HackensackUMC receiving in-stadium branding at the Red Bull Arena.

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