Hospitals and health system boards are still looking for strong leaders, but what's changing is the kind of experience you need to elevate to the top job.
So you want to be the CEO of a hospital or a health system.
Here's the first thing to know: Like it or not, the role of acute care is slowly being relegated.
It's still important, and it's still a high-reimbursement area, but specifically because of that, scores of people and companies are trying to figure out how to use it less.
As a result, even in organizations where acute care represents the lion's share of revenue, the competencies of today's successful CEO range far from the acute-centric skills many hospital and health system executives and boards once prized.
All of today's CEO candidates have to understand the critical interactions between the inpatient and outpatient realms, and the fact that delivering value rests on managing those interactions, not from maximizing patient census and inpatient days.
"Running a health system is about trying to provide coordinated care in an environment that's patient- and family-centric," says Jim King, senior partner and chief quality officer with Witt/Kieffer, a healthcare executive search firm.
Given the need to reduce reliance on acute care services, leaders who want to be CEOs have to learn skills applicable to the rest of the patient’s healthcare journey.
1. Ambulatory Experience
Perhaps nothing is more prized in today's CEO as outpatient experience.
This has not always been the case.
Before the advent of value-based care, outpatient experience was a possible warning sign that the candidate had been placed in a managerial backwater.
"Ambulatory is becoming a lot more important, and it's critically important for healthcare CEOs to understand the interactions between the inpatient and outpatient settings," says King.
The ability to do so shows aptitude for handling an integrated care delivery model, toward which many health systems are transitioning.
"Almost all our clients now are looking for that in an ideal candidate," says King. "Some of the more progressive candidates are really seeking [outpatient experience] as they develop their careers."
2. Managing to a Budget
One of King's health system clients is seeking a CEO for one of its regions. It's a job managing multiple sites and the CEO reports to a regional board and the chief operating officer of a bigger health system.
One of the key prerequisites for this client's candidates is extensive experience developing and managing to a budget.
Additional skills include experience with pro forma forecasting "so they really do understand the bigger picture of the financial aspects of the organization," says King.
3. Demonstrate Physician Collaboration
In many cases, provider management comes along with outpatient experience, but sometimes another executive is responsible for managing providers day to day. The best CEO candidates demonstrate the ability to do both at the same time.
"What boards are really looking for in any CEO candidate is a track record of being able to collaborate and partner with physicians," King says.
Part of being able to demonstrate that skill is to provide examples of how you have developed programs within a health system that involve getting physicians to buy in. Examples could be eliminating variation from practice or developing an outpatient facility that involves physician input and collaboration.
What boards are really looking for is the style candidates use to engage physicians in development of these programs.
"It's about trying to provide coordinated care in an environment that's patient- and family-centric," King says. "In the best health systems now, that's the environment that allows them to be successful."
4. Not Necessarily a Physician
A large number of Witt/Kieffer clients are looking specifically for physician candidates in the CEO search, but that's not the key getting hired.
"A lot of clients believe if they had a physician in that role, they'd automatically be a much more collaborative organization, or more patient-centric," says King. "That's not necessarily the case."
For aspiring CEOs without a medical degree, what's more important is to make sure your leadership capabilities stand out regardless. That involves demonstrating that in previous roles, that you have created a vision, and inspired those around you to improve the organization demonstrably.
Overall, choosing a new CEO is about leadership, and most boards will still hire the candidate that best fits its culture, connects well with its values, and brings a proven track record of leadership.
5. Communicate and Execute
This is a bit of an esoteric skill, but the best CEO candidates, regardless of background, have an ability to "be presidential," says King. You must demonstrate your previous experience interacting with boards and in being on boards yourself, in order to appreciate board members' responsibilities and priorities.
"Are you staffing a couple of committees of the board? Are you attending meetings and getting to make presentations before the full board at your current or previous stops?" King asks.
It may not be as important to have moved around a lot in your career, but it is important to gain that governance experience.
"It's also good to have some staying power and show you can come into an organization and over five to seven years move the ball on some significant issues," says King.
Beyond that, make sure you serve on boards at a national level, such as with the American College of Healthcare Executives or other national groups, that would give you a broader perspective.
Philip Betbeze is the senior leadership editor at HealthLeaders.