Parkland Reorg Designates Interim Leaders

Five of the six top leadership positions at troubled Parkland Health & Hospital System are now filled with interim appointees following a reorganization of the Dallas facility announced Friday.

The interim designations reflect Parkland's "aggressive search" for a permanent CEO, Debbie Branson, chair of the hospital's board of managers told HealthLeaders Media during an interview Friday.

"We want to provide the new CEO with maximum flexibility to choose his or her own team," explained Branson. The new team also provides the hospital with much needed turnaround experience as Parkland works its way through a federally mandated corrective action plan (CAP).

While Branson says the safety net system has made "significant strides" on the 400+ action items required by the CAP, she acknowledged that Parkland is at a point where it "needs to step it up a bit."

The safety net hospital has until April 2013 to become compliant with the rules and regulations of the Centers for Medicare & Medicaid Services or risk the loss of an estimated $417 million in annual Medicare and Medicaid contracts.

She notes that the new team has "significant turnaround experience in the healthcare industry. We feel like this is the appropriate team to make the changes we need to make at this point." Now it's time, Branson says, to start auditing the policies and procedures put into place for the CAP and this team will make sure the changes "are hardwired into the system."

Parkland's senior leadership team includes:

• Thomas Royer, MD, who was named interim CEO in November 2011. His contract expires September 1. He succeeds Ron Anderson, MD, who was the CEO for 29 years before the board of managers removed him from that position in August 2011. Anderson remains under a one-year contract with Parkland as senior advisor to the CEO.
• Ron Laxton and Sharon Phillips, RN, now share the interim COO title. The COO spot had been empty since the September 2011 departure of John Haupert, who was named president and CEO of Grady Health System in Atlanta. Laxton will focus on hospital operations. He joined Parkland in March as the chief implementation officer for the CAP and reports directly to the hospital's board. Sharon Phillips will focus on off campus operations, including ambulatory care and behavioral health services. She has been with Parkland since 1985 and has held several executive positions.
• Ted Shaw, an accountant, has joined Parkland as interim CFO. He replaces John Dragovits who announced in June that he was leaving to become president and COO of a Dallas healthcare information technology company. According to Parkland Shaw has served as CEO and CFO at both public and private healthcare organizations. He was until May 2012 the CFO of the University of Miami medical school.
• Christopher Madden, MD, was named interim chief medical officer following the Friday resignation of John Jay Shannon, MD, who had served as CMO since 2007. Shannon's resignation "was voluntary" following good discussions, according to Branson, who added that Shannon will help with the CMO transition. Madden, a neurosurgeon at University of Texas Southwestern Medical Center, has since December serviced as UT Southwestern's assistant vice president for Parkland Health & Hospital System affairs.
• Mary Eagen, executive vice president and chief nursing officer, joined Parkland in January 2012 to restructure Parkland's nursing organization. Systemic issues in the role and organization structure of nursing and nursing practices have been identified as contributing to many of the Parkland deficiencies identified by CMS. Eagen was previously regional chief nurse executive at Christus Health Southeast Texas in Beaumont.

Branson says a nationwide search for a permanent CEO is underway. The Parkland board hired Korn/Ferry International in June to conduct the search. Branson is hopeful that potential CEO candidates will view the reorganization as positive. "I'm hopeful that we will have made significant progress toward the completion of the CAP and that will be a plus for anyone looking at the job."

Although no timeline for the hire has been released, Royer's current contract as interim CEO is set to expire in September. Royer has come under fire for taking action without board support. His hire for chief implementation officer was reversed by the board. Ron Laxton, who was ultimately hired as an interim COO, reports directly to the board.

Meeting CMS requirements is estimated to cost $25 million. Branson says that while the board is cognizant of its responsibility to be fiscally responsible with the taxpayer's money "we need to do what it takes to make the changes required."