Adventist La Grange Memorial Hospital: Rick Wright, CEO

by HCE Exchange on September 1, 2011

During the past two years, Adventist La Grange Memorial Hospital has proven that through efficiency, hard work, and clear messaging a hospital can turn around profits.

In 2006, Adventist La Grange opened a new patient-care center on campus with 171 private rooms. This patient tower brought a high debt load to the hospital, which was already struggling to make a profit with its patient base in Chicago’s western suburbs.

Despite the debt load, Chief Executive Officer Rick Wright said the hospital began making a profit in 2009 just three years after opening the patient-care center.

“The past two years have been record-setting in terms of finance,” Wright said. “This has been the culmination of our journey toward profitability since 1999. It’s a story of efficiency and teamwork.”

About Adventist La Grange

Adventist La Grange is a 205-bed hospital, providing all major specialties, outpatient and inpatient primary care, trauma care, and wellness services. It has a freestanding cancer-treatment center pavilion on its 32-acre campus and about 1100 employees. It also boasts an  off-site rehabilitation center and a family-practice residency program.

Adventist La Grange is part of Adventist Midwest Health (AMH), which owns numerous not-for-profit hospitals and medical facilities in Chicago’s western and southwestern suburbs. Adventist La Grange has about $160 million in net revenue annually.

Adventist is located in Cook County. Its primary service areas are La Grange, La Grange Park, La Grange Highlands, Western Springs, Willow Springs, and Indian Head Park.

In 1999, Hinsdale Hospital and Columbia La Grange Memorial Hospital ended a 44-year competition when AMH acquired both hospitals. Separated by 2.2 miles and the I-294 Tollway, AMH merged the two organizations. It was a plan that made sense on paper. In fact, tremendous growth was predicted.

What followed was a decade-long struggle to make Adventist profitable.

Key values moving the organization forward

In an effort to turn around profits and move the organization forward, Wright said the hospital “had to go back to basics.”

The first step was to communicate the situation internally with employees and leadership. This included clearly spelling out the expectations for ALMH leadership.

Leaders were expected to be results-oriented. As Wright defined it, this meant going beyond being “problem identifiers.” Now, leaders were expected to be “problem solvers.” To chart this, leaders had to maintain a “results dashboard” that tracked outcomes. They had to maintain a record of the plans used to achieve those solutions.

Second, leaders were expected to be good corporate citizens who understood and supported ALMH’s mission, vision, and directives. Wright saw complying with corporate mandates, ensuring regulatory readiness of their respective operations, and being a catalyst for progress within their core measures as indicators of success in this area.

Leaders were also expected to be “intrapreneurial,” meaning that they were to run their department as if it were their own business. Success in this area meant each leader would have to take ownership of the entire job, as well as his or her revenue and expense lines. They would have to understand the marketplace, be aware of industry trends, and tuned in to customer needs and desires. Enriching the patient experience and receiving patient feedback would be the keys to success in this area.

Additionally, leaders were to see themselves as standard bearers who demonstrated proficiency and an adherence to SHARE principles in their work ethic. They were to maintain a disciplined “employee culture” where reward, recognition, and corrective action were never overlooked.

A five percent change in the budget was also proposed. Other changes included managing to expense per unit of service, constantly monitoring the ED, and installing Wi-Fi.  ALMH also identified which departments were over their budgets and developed a specific timeline for getting back on track financially.

“We needed to create an environment where people feel they can give an honest, straightforward answer,” Wright said. “We also needed consistency in messaging. That has helped to get buy-in and understanding of where we’re trying to take the organization.”

In addition to regular monthly meetings, Wright began having a special leadership meeting twice a year that resembled a “fireside chat” to encourage more open conversations among administrators and leaders. He also started employee forums on a quarterly basis to encourage communication with staff and to allow him to deliver consistent messages to employees.

Planning for the future

The hospital is working on some capital projects in the coming year, including cath labs, a renovation of the physician lounge, and a wound-care center that will feature hyperbaric oxygen therapy (This opened in December 2010.). Adventist is also relocating its wound-care facility from off-campus to the main campus.

As with all healthcare organizations, Adventist is preparing for an uncertain future with the accountable care organization (ACO) structure on the horizon.

“The ACO structure is a great unknown,” Wright said. “There is a new set of expectations, new terminology, new players. We are aligning with medical staff in the community to be positioned for this new structure, although we aren’t exactly sure what is going to be expected of us yet.”

Despite what changes come, Wright said that being part of a larger health system increases the hospital’s security, and he knows the hospital will remain open.

“More affiliations will probably come in the future,” he said. “It is important for us as a region to have a stronger negotiating presence in our market. But we are a strong, viable organization, and our first commitment is to serving the community. We will not compromise on quality.

-by Patricia Chaney, with additional material by Pete Fernbaugh

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