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Business Observer Friday, Mar. 31, 2017 2 years ago

Better Together

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The complexities of delivering health care can drive people bonkers. A startup dotted with All-Star executives aims to heal their pain.
by: Mark Gordon Managing Editor

After two decades in executive marketing roles, some with a national golf course and country club operator, some with a billion-dollar RV business, Stewart Schaffer found himself in an odd place: a room full of 100 hospital system employees.

It was 2009. Schaffer, with experience at ClubCorp International and Lazydays RV Supercenter, was recruited to oversee marketing and strategy at Clearwater-based BayCare Health System. Then with nine hospitals in the Tampa region, BayCare was one year into a major transformation of its model, to go from a hospital-centric system to one more patient-centric. Schaffer was brought on to bring his run-it-like-a-business experience and Wharton MBA mindset to the transition at the nonprofit medical system — an unusual marriage.

Schaffer sought to set the tone from the beginning of his BayCare stint. “I told everyone that my primary reason to be there was to drive top line revenue,” Schaffer says. “I told all the people: 'If you're here for any other reason then to grow patient care revenue and patient lists, then you are here for a different reason than me and you should think about working in another department.”

The devotion to the top line mission paid off. Over six years, Schaffer's department helped the health care system increase revenue 25%, a gain of $500 million. The system's net margins, adds Schaffer, increased from 5% to 7% during his tenure.
Schaffer, 65, is no longer with BayCare, but he remains in health care.

He's at the helm of a new consulting company, CSuite Solutions. The Tampa-based firm's mission, says Schaffer, is to help midsize hospital systems nationwide shift from volume-based business models to value-based care — a major industry trend.

CSuite, which Schaffer calls more of a strategic adviser than a consulting firm, has a trump card in its mission: a roster of seven health care executives who come to the business with stellar resumes and dozens of years of real-life experience.

Top notch

Schaffer's co-founder and fellow managing partner with CSuite is Steve Mason, former CEO of Clearwater-based BayCare Health System.

Mason led BayCare, a nonprofit integrated health care system that operates 14 hospitals, with 5,400 doctors and 25,600 employees, from 2004 to 2016. Under Mason's leadership, BayCare revenue increased from $1.4 billion to $3.3 billion; net assets rose from $1.3 billion to $4.1 billion; and operating margin increased from 5% to 9%. Prior to BayCare, Mason was COO of Arlington-based Texas Health Resources, with 13 hospitals, 17,000 employees and $2.3 billion in revenue.

CSuite has built a cabinet of other partners with unique experience to round out the team (see below).

CSuite officially launched March 1. The company targets hospital systems with operating budgets from $500 million to $1.5 billion, with three or four managed facilities, says Mason. It also hopes to work with academic and teaching hospitals.

The goal of the organization, say the co-founders, isn't to bring in a bunch of rainmakers and grow a large client list. They instead seek to go deep into a transformation strategy with clients — not create a glossy binder with some initiatives and leave a week later.

“We want to use our experience and sit down with other health care executives and help them,” says Mason, 68. “There is nobody who is doing this today like this.”

The group's experience fits particularly well in leading organizations through change — something Mason and his team have done for decades. Says Mason: “We know the challenges that health care leaders are facing because we've sat in those chairs ourselves.”

Forthcoming switch


While health care is a hot national political topic, Mason and Schaffer say CSuite is apolitical. “Whether it's ObamaCare or TrumpCare, I don't think it matters,” Mason says. “I don't think there's much of a difference. The issue is we need to be more cost-effective and deliver more quality care.”

That's a big reason why CSuite pursues a value over volume philosophy. A volume model, currently how most hospital systems work, is essentially a fee for service model. On value, it's more of a fee for performance-based business model.

One of the keys in value-over-volume health care, says Schaffer, is value-based contracts reward providers that reduce costs and improve quality under a defined budget. Also, the focus in value-based care shifts from treatment to prevention.

Hospitals, project CSuite officials, will be forced to make the value-over-volume switch eventually. “The industry is facing declining margins and consolidation due to lower reimbursement rates along with growing revenue cycle challenges,” states a March 10 company report.

The opportunity for CSuite to capitalize on the changes is big. For one, the health care strategic services market is estimated to surpass $6 billion soon, according to research firm IBISWorld. The industry is also expected to grow at least 12% annually during the next five years. Major players in the market include top firms such as Accenture, Bain and McKinsey.

'Visionary guy'

The knowhow CSuite can bring to clients, says Schaffer, will be a key differentiator to win business.

Mason, for example, has four decades in health care and is well-known in the industry nationwide. “He's a visionary guy with lots of charisma,” says Schaeffer, who reported directly to Mason at BayCare. “Leaders of organizations tend to listen to him.”

Schaffer also brings a unique skill set to CSuite. At BayCare, after his focus on top-line revenue speech, Schaffer spent a considerable amount of time breaking down silos. He created analytics and research departments that worked in unison with one overarching goal: find and understand data, then use it to drive revenue growth.

“I'm not your typical health care marketing executive,” Schaffer says. “I've been a data-driven executive my entire career. I use data for marketing and branding and to make decisions.”

Schaffer says while seven partners is a good place to start, CSuite might add five or six more executives with similar experiences, depending on the need. Mason says the CSuite mission is a nice career capstone for many of the partners.

“We are at a place where we don't need the work,” says Mason. “But we feel like we have a lot of knowledge and we don't want our brains to rot.”

The roster

In addition to Stewart Schaffer and Steve Mason, the following are also part CSuite partners:

• Josh Adler, former president of Archimedes Clinical Analytics, formerly a subsidiary of Kaiser Permanente. From 2004 to 2007, Adler was CEO of St. Petersburg-based SunCoast Medical Clinic, one of the largest multi-specialty group practices in Pinellas County, with 55 physicians;

• Jim Burkhart, former CEO of Tampa General Hospital. From 2003 to 2013 he was president and CEO of UF Shands Jacksonville Medical Center. In 2013 he was named CEO of Tampa General, one of the largest medical systems in the state, with an annual operating budget of more than $1 billion and 6,785 full-time employees. Burkhart is also chairman of the Florida Hospital Association board;

• Dr. Stephen Jacobs, a board-certified internal medicine specialist and former president of Morton Plant Mease Primary Care;

• Brian Paradis, former president and COO of Florida Hospital's Central Region, a $4 billion enterprise with more than 25,000 employees and 2,000 physicians. Paradis was also CFO of the Florida Division of Adventist Health Systems, where he helped launch Celebration Health, a state-of-the-future health care facility in Walt Disney's Celebration community; and

• Jeffrey Rivest, former president and CEO of the University of Maryland Medical Center. Rivest retired from his University of Maryland post in 2015, after 11 years. He's helped run academic medical centers in the Mid-Atlantic and Northeast for 30 years.

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