Jackson & Coker Industry Report
Healthcare Executives’ Insights:

Shawn Strash, FACHE
– Chief Executive Officer with Oro Valley Hospital

Recently Thomas J. McKeever, Jackson & Coker’s National Sales Director, and Healthcare Consultant Brad Mitchell, interviewed Shawn Strash, FACHE, for the Jackson & Coker Industry Report.  Mr. Strash serves as Chief Executive Officer with Oro Valley Hospital in Oro Valley, Arizona.  Here are highlights of their conversation.

Shawn Strash, FACHE
     Shawn Strash, FACHE

TM:  Tell us a little about your background and what prompted you to enter the healthcare industry, particularly with your eyes toward the administrative side. 

SS:  Early on, I was a lifeguard and then I served in the Canadian Coast Guard, Search and Rescue--kind of like an EMT on water--so I’ve always been interested in helping those in need or in distress. As an undergraduate, I was not so much interested in practicing medicine. However, as I began to speak with hospital CEOs and others, I was drawn to the profession.  I did earn my masters in hospital administration from the University of Ottawa, which by the way, beat out Harvard several times in case competition.  So my interest in health care administration developed from that point on.  

TM:  Occasionally we hear from doctors and other clinicians saying that they would not choose medicine if they had it to do over.  Does that carry over to the administrative side?  Would you discourage others from entering the medical profession?

SS:  I don’t think so, I wouldn’t discourage anyone.  In fact, my oldest daughter is studying to become a doctor and her fiancé wants to go into hospital administration.  It’s a great field and I love my job.  Even with all the pressures and regulations, I still very much enjoy what I do. 

TM:  As a contemporary health care executive, is there one—or several—main challenges that you face in your position today? 

SS:   Until the downturn in the economy, one of the biggest challenges was to find qualified nurses and care staff.  You’re probably aware that the supply of nurses this year is certainly better than it was last year.  Our contract labor is down to almost zero, and the contract labor companies have stopped calling us because we really don’t use them very much anymore.  When I first came here as CEO, we were using almost $500,000 some months in contract labor, and now we don’t use that in a year.  I feel very proud of the fact that we have been able to cut that down substantially. 

There’s also been a cultural shift.  Although a lot of nurses want jobs, it’s still tough to find qualified, well-trained nurses because they want to stay where they are.  We’ve still hired some, including student nurses, and brought them in and trained them.  We’re looking down the road in anticipation that this is not going to last forever.  The labor supply is just one issue—a short-term supply issue that’s not going to be long-lived.

The second challenge is to recruit physicians in underserved medical specialties.   For instance, it’s tough to find Neurologists and tough to find other specialists.  One of the toughest jobs now is to recruit ENT doctors.  It’s strange—there are no ENT’s right now.  And I’d certainly encourage anyone selecting a specialty to go into an ENT program.  In some cases, they’re commanding salaries and reimbursements similar to Cardiac surgeons. That will change, of course, and who knows what it’s going to be like next year or the year after. Specialist shortages will continue.

TM:  That leads me to mention: we are hearing from some people in your position concerning the need for more Primary Care staff.  Is that something as prevalent as some of the specialty needs that you have? 

SS:  Yes, I feel very fortunate in recruiting for this geographical area, which is certainly very beautiful.  Finding and keeping A+ Primary Care physicians here hasn’t been that much of an issue.  In fact, this hospital is very Primary Care-based as we grow into a tertiary care hospital.  Our sister hospital is 25 years old.  Of course, as you grow older, you become less PC-based.  Primary Care is certainly important, and for us we don’t get the high-level specialty referrals like open heart, because we don’t do open heart surgery.  We don’t do Neurosurgery—yet.  It’s coming down the line, but we’re four or five  years away from it.  As the patient base grows, you get a critical mass of patients requiring it.  And of course, if you’re going to do it, you have to do it well.

The other area that concerns me is health care regulation.  Anywhere you turn, there is a ton of paper work.  Medicare, the state, Joint Commission, and managed care companies all have a job to do.  I understand that and we will continue to do whatever is required of us to remain compliant.  As you know, it’s a very highly regulated industry, and our quality and satisfaction scores show that we take care of the patients very well. And as you know, it’s very labor-intensive to make sure that you satisfy all of the agencies and bodies that regulate you.

BM:  Incidentally, I have a client in rural Kentucky that has had to hire two FTE’s to manage what you’re talking about, especially regarding Joint Commission.  That’s one full-time doctor or medical provider he can’t have on staff because he has to have these people to basically manage Joint Commission compliance.    

TM:  That leads to another point.  When you consider all that’s involved in supplying quality clinical service--given all the paper work--where do you think in your role that your time is spent most productively?

SS:  The most productive thing, I think, is trying to run the business well while still  meeting community needs—making sure the hospital provides all the services the community wants in a cost-effective delivery model.  We look at data and dice it up and dissect it.  How do we continue to satisfy the needs of the community that we are based in; those things concern us.  I don’t want to see patients bypass our facility.  I understand the need for Neurosurgery and open heart surgery.  We don’t provide those services right now, and everything else we do provide, we do very well.  For instance, in terms of Cardiac care, we’re #1 in the city. 

We can’t spend a million dollars on ads like some of our competitors.  But the data is telling:  what we do we do better than our competitors in the city.  So a major part of my job is to make sure that we are meeting the needs of the community, in a cost-effective manner with the highest level of quality care.

Another main aspect of my job is recruiting physicians as that is a huge focus for us.  We’ve made some changes to the process and recruited 11-12 docs over a  year—and a dozen or so upcoming this year; in so many words, I’m speaking of the physicians that we specifically sponsor, and bring in, not the ones who come in on their own.

TM:  As we give these interviews across the county, one of the questions we focus on is, ‘Where do you spend your time most productively in making sure that the services the hospital provides is capturing as much of that market as possible within your catchment area?”  As a corollary, where do you think your time is least productively spent? 

SS: What you’re actually seeing more often in this economic downturn are complaints about costs – co-pays and deductibles.  Whether justified or not, folks are under economic pressures to reduce their expenses. Now when they get a hospital bill, the complaints have flipped.  Very few complaints concern the services of the hospital; today, more are about billing.  Like:  “Why is my bill so high after I had to wait an extra half-hour in the ER?” We do spend time on patient out-of-pocket cost issues.  Not that it’s non-productive, but it is a little disconcerting in that there are people who are out there struggling in this economic climate, and we do try to help them.  We do spend a lot of time with that.  If I had any wishes, it would be that those kinds of issues would be nonexistent and reform will potentially aid in this area. Incidentally, that may be a bad example, as we’re known for having some of the shortest ER-wait times in the city!

BM:  Is it the actual billing or trying to match the insurance that’s of greater concern?

SS:  It usually comes down to the ability of paying a co-pay or a deductible.  In these economic times, some folks just don’t have that kind of money.  When you look at certain services we provide—and it probably holds true across the country—nationally, hospitals are seeing a decrease in knee and hip replacements because a lot of folks are putting it off now. For example, they don’t want to pay the $500 co-pay to have it done.  We’re fortunate to have a joints program with outcomes that are the best in the city.  Across the country however, people are putting it off.  I would never think that a knee replacement is elective, but they’re treating it that way.  Another thing is GI volume—GI screenings and other types of more common services that Medicare pays for. 

It’s both anecdotal and evidence-based that patients say that their screenings have come back with no problems in the past; so if they miss a screening in December, they’ll just wait until next year to get one.  So it’s interesting to see that kind of trend.  Certainly, the economy will turn around, but even in this affluent area we’ve seen people affected.

TM:  Moving to another topic, how has swine flu or other seasonal medical problems affected your hospital’s service? 

SS:  We really haven’t seen a large uptick in flu cases compared to last year.  Almost 2/3 of our patient volume is retirement age.  As you know, there was a strain about 60 years ago; so those over 65 are much less likely to be affected than you and I.  We’ve seen in this hospital only one case of H1N1 admitted so far. We’ve had some folks present for it, and test for it, but not more so than the regular flu. I know other areas have been affected more than us.  It could be the population base or area they’re living in.

We’re ready to staff up, though: 95% of our staff have had flu shots—both regular and H1N1.  Incidentally, the government has done a great job to provide immunizations to everyone in the highest risk categories.  I also see families out there—my own included—who have not been immunized.  I have four kids who are all going to get a shot.  In the meantime, we have stored Tamiflu in the fridge just in case, but anyone can do that.  Bottom line is, H1N1 flu hasn’t affected us at this particular hospital to a great extent. 

TM:  It is interesting how different parts of the country have different experiences.  In some cases they’re setting up tents in the hospital parking lot to treat the large volume of patients—or, on the other hand, they say, “No, we’ve really not seen it affect us that much.”

SS:  I know for instance, some parts of Texas have been affected pretty heavily.  We have signs everywhere telling patients to see their PC docs if they think they are affected.  Of course, we train for universal precautions such as washing hands, etc.—which works.

TM:  Another key question:  If the president or someone in the administration were to call you today, what would you tell elected leaders regarding putting together some version of pending legislation  referred to as “universal health care”? 

SS:  I’m in favor of reform, but I’m not in favor of complete overhaul.  For example, let’s get the folks covered who aren’t covered and the folks between jobs.  COBRA is a great idea; it’s a great concept—I love it, but it is expensive.  Let’s fix what’s broken and not mess with the rest of it.  I’m encouraged that we’re moving in the right direction.    

BM:  A lot goes back to insurance companies. Twenty-five years ago, if you had Blue Cross, you had Blue Cross.  Now, if you have Blue Cross, there are 170 different plans or more—customized to the employer.  My father, a semi-retired pharmacist, said that’s the biggest difference.  When you talk about billing issues and co-pays to have the same procedures done, there can be 100% difference in cost.   

SS:  How true.  One of the areas I believe Washington could improve on is working together with the managed care companies.  If anyone really wants to know the trends, the folks who know how to manage the data are managed care companies.  They know all the data:  exactly what’s happening, when and where.  If I could encourage them to do something, I would encourage them to embrace the managed care companies and try to work together on this.  Use their data.  Medicare definitely has some great data, but the managed care companies ‘slice it and dice it’ like no one’s business.

TM:  Given the potential looming issue of the economic downturn, are there any trends you’re seeing in terms of independent hospitals or hospital  systems coming together to merge.  Are you seeing any of those trends?

SS:  Not so much here.  Other hospitals nationwide are experiencing tougher times—seeing smaller profit margins and having reduced funds for capital projects.  Overall, we have a pretty healthy system in Tucson.  Generally speaking, we haven’t seen the same impact that other areas have experienced.

TM:  What about the cost of insuring employees?

SS:  This has become a larger expense, especially from the employer’s side.  Although employees have had to pay more for their health coverage over the last few years, proportionately employers have had to pay a lot more.

TM:  As a staffing company, what more can Jackson & Coker do to better serve health systems like yours?

SS:  Do your homework and get the data upfront before you call.  Ideally, have some actual knowledge of what the staffing needs of the organization are before making contact. This might be somewhat hard to do, and I don’t know exactly how you can accomplish this.  But it would be beneficial, nonetheless.

TM:  Are there specific ways our industry research can help your organization?

SS: Yes, it would be helpful to have more data concerning the demographics of our community.  Even though there is technically 50% unemployment in our area, 42% of our residents are retired.  That should be accounted for when staffing models are taken into consideration.

TM:  On a final note, what are the most rewarding aspects of your executive career in healthcare?    

SS:  For starters, finding good mentors to latch onto is important.  Not only can you learn more that way; but also you can avoid pitfalls and mistakes if you have a good mentor.  It’s particularly rewarding to work in an industry that is always changing and not a static community.  Furthermore, it gives me satisfaction to come to a corporate culture made up of various levels of people who work hard and genuinely enjoy serving others.

TM:  Thanks so much for your time and insights.  We’re sure our readers will benefit from your perspectives on the matters we’ve discussed.

Shawn Strash, FACHE, is the CEO of Oro Valley Hospital, a 144-bed community hospital in Oro Valley, Arizona.  He is currently responsible for the operations and strategic management of this five-year-old, state-of-the-art hospital. 

He came to Oro Valley Hospital in October 2007 from Mat-Su Regional Medical Center in Palmer, Alaska, where he was chief operating officer and ethics and compliance officer.  Prior to that, Mr. Strash was the chief operating officer and chief staffing officer at Redmond Regional Medical Center in Rome, Georgia, and the chief operating officer and chief staffing officer at Palmyra Medical Center in Albany, Georgia.

He also held director of operations and director of development roles within HCA’s Ambulatory Services Division.  In these roles, Mr. Strash developed and operated 12 surgery centers and developed and started numerous ambulatory surgery centers including the sole free-standing pediatric surgery center in Atlanta for HCA’s Eastern Group and Southeast Divisions.

Mr. Strash earned a Masters Degree in Business Administration from the University of Texas. He also holds a Masters Degree in Healthcare Administration, as well as a Bachelor of Commerce, from the University of Ottawa.  He is a fellow with the American College of Healthcare Executives.

Mr. Strash is married with four children.

Today, due to the leadership of Mr. Strash and his team, Oro Valley Hospital is thriving and excelling in fulfilling its mission of providing compassionate, customer-focused care.

Healthcare Executives’ Insights:

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