Exclusive Interview: Lessons From Wayne Sensor's Fall at Alegent Health

HealthLeaders Media Staff, October 30, 2009

I've gotten huge response from my column last week about the difficulty of large-scale culture change at hospitals and health systems, epitomized by the sudden resignation of Wayne Sensor as CEO of Omaha's Alegent Health after two physician confidence votes went against him. Much of that response has been in support of Sensor, some has been in support of the docs, and almost all has been off the record or otherwise anonymous. And let me tell you, I've heard all kinds of stuff. More on that later.

"There are probably not a lot of CEOs who would be comfortable talking about this," Wayne Sensor told me earlier this week. "But my greatest desire is to help others who wish to lead transformation."

Well, I can guarantee he's right about one thing: there aren't a lot of CEOs who would talk publicly about the physician revolt he oversaw or the circumstances surrounding his resignation. In fact, I don't know if I would be talking to me were I in his shoes. But Wayne Sensor has always been different, ever since I was working the finance beat back in 2005 and talked to him for the first time. And I appreciate his openness.

At the time I first talked with him, Sensor's hospital system was at the cutting edge of making patient cost in healthcare more transparent through Alegent's MyCost online tool, still alive and well on Alegent's Web site, despite the shift in public debate away from patient involvement and responsibility and toward government involvement and "public options."

At the time, the trend of hiring physicians directly to work for the hospital was well-established at some of the best known, highest quality institutions in the nation, but that was a select group. Since, employing physicians become much more of a trend, and it's produced some heated disagreements between hospital executive leadership and independent physicians who practice at and refer patients to such hospitals.

But what you want to hear about is the circumstances surrounding Sensor's dismissal, so let's get that out of the way. Here's what I know from my conversation with Sensor, as well as news reports:

A large portion of the independent physicians who refer to Alegent hospitals decided he hadn't been honest with them about a plan to gradually transform the system to an employed physician model. He tells me that he thought he had embarked on this plan thoughtfully, honestly, and with the support of both the board and key physicians who wielded power in the organization, although those physicians weren't employees. Turns out, more of them disagreed with his perception than agreed.

What's fact is that over the 5 ½ years Sensor led the organization, the employed physician contingent has grown steadily, and now numbers about 200 of the 1,200 physicians on the system's staff. Clearly, the relationship between Sensor and independent physicians soured badly evidenced by a large contingent of doctors who had stopped referring to Alegent facilities or who threatened to do so. Subsequently, the board requested his resignation and he complied. He didn't want to resign.

I've heard lots of other salacious stuff that is reported to have been a contributing factor in the resignation from well-placed sources who refused to go on the record either with me or with Cheryl Clark, one of my colleagues at HealthLeaders Media who did some early reporting on the story. So I take that information for what it's worth: not much.

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