Dennis Matheis talks about workforce challenges, sustainability, and the future of consumer-focused care.
Dennis Matheis stepped into his role as president and CEO of Sentara Healthcare in September 2022 following the retirement of the nonprofit health system's previous CEO, Howard Kern.
He has more than two decades of senior leadership experience in healthcare finance and delivery and previously served as president of Sentara Health Plans and EVP at Sentara Healthcare for nearly five years, which empowers him to bring a unique leadership perspective to his role.
Matheis recently spoke with HealthLeaders about his first six months as president and CEO of the Norfolk, Virginia-based health system. He talked about topics including solutions to workforce challenges, sustainability, and the future of consumer-focused care.
This transcript has been edited for clarity and brevity.
Dennis Matheis, President and CEO, Sentara Healthcare. Photo courtesy of Sentara Healthcare.
HealthLeaders: What have you been focused on during your first six months as CEO?
Dennis Matheis: I'm enjoying the role and learning a tremendous amount. It's also very gratifying, as I've been able to get out and meet with a lot of our folks, especially on the care delivery side of our organization.
Prior to assuming the role, I got out to all of our facilities and most of our larger clinics, and the passion that our team members have for their mission of taking care of people really hit home for me.
The safety of our team members has come up again and again. We have more to do there. At the end of the day we've got to create safe environments for our team members, our patients, and our visitors in our facilities. We've done things such as piloting weapons detection systems in our EDs; [there is a] staggering number of weapons we've turned away from two of our EDs over the past six months. We're deploying [that] technology in all of our facilities, as well as we've gotten tighter in terms of our badging of our team members [and] our visitors coming into our facilities so that we know who's in our facilities at all times.
Now, we're working with the local police departments to create more of a police presence outside of our EDs as we move forward. We pushed legislation that would make it more difficult and add more stringent penalties for people to bring guns onto a hospital campus. Unfortunately, the bill didn't get through the Virginia General Assembly this year, but we'll be back at that next year.
We're in the midst of a strategic refresh for our organization. We've got a number of work efforts centered around consumerism and the notion that we need to become more consumer-oriented as an organization. We've labeled it 'One Sentara,' and it's leveraging both the healthcare financing side of our organization alongside our healthcare delivery to create more seamless, easy-to-use experiences for our patients/members. This will be a multi-year journey for us as an organization. It's about how we help drive and make healthcare simpler for our patients and customers, more accessible, ultimately more affordable, and get to a more simplified experience. The work that we're kicking off there is going to engage fairly deeply into the leadership ranks of our organization as well.
I'm really excited about what we've done and accomplished over the past three months, but certainly, the rubber is going to start to hit the road in the coming months and years as we continue to focus on those efforts.
HL: What is Sentara currently experiencing with workforce shortages and how do you plan on addressing that in the coming months and years?
Matheis: In the short term, we've made some extraordinary pay increases and benefit increases in 2022, especially in our clinical areas, but broadly across our enterprise. It was with an eye to help stabilize our team members, try to wean ourselves off of utilizing traveling nurses in several of our facilities, and by and large have had good success in terms of stabilizing our workforce.
We added several thousand new employees in 2022. We have, in the short run, plugged some of the challenges that we had been experiencing in '21 and in '22, not without some significant costs. But when you look at overall inflation nationally, and everything else that's going on, what we did was the right thing to do at the time for our team members and for our organization.
Longer term, as part of our strategic refresh work, we're working on putting together a 10-year workforce plan. It'll be wrong in the moment it's on paper, because the world is changing quite rapidly around us, but it will provide directional anchors in terms of the things that we need to focus on as an organization.
The notion of getting top of license for all of our team members. We as an industry [more than] a decade ago started to pivot away from non-BSNs being at the bedside in our care delivery organizations and our hospitals. We're now experimenting [with] going back to more of a team approach, and utilizing either nurses or LPNs to support our nursing staff, just to create a team approach in terms of bedside care. We've got pilots going on in several of our facilities, and if we're able to demonstrate that we're able to maintain the high-quality standards that we have as an organization, that will probably become a driver for us in terms of how we leverage staff.
Also tied to the work [of] both nurses and physicians in our organization and broadly in our industry is the data we collect in our EMRs. It's valuable in terms of our ongoing journey around driving quality as an organization, but it's also eating up a tremendous amount of time of our clinical staff. We've got to figure out how to collect the data we need to continue to drive the quality that we're trying to achieve as an organization and continue to improve upon, without sucking up time out of the workday of our nursing and clinical staff. We're looking at some nascent companies that are developing AI and machine learning to help pre-populating information into the medical records to make it easier or intuitive for documents to be generated. While there's a lot of promise there, it is going to take time for those technologies to play out, but certainly, that's on the roadmap in terms of how we leverage our existing staff more effectively as we move forward.
Pivoting on the physician side of this topic, [the] same [holds] true in terms of top of license. If you ask subspecialty physicians how much of their patient load could be handled in a different setting than in their office, about 20% to 25% of their patient volumes is the answer I consistently get. How do we rework the system? We're going to have to work and re-engineer those pieces of our care delivery model so that we can start to free up subspecialty time because there's just not going be enough of them to fill the need unless we start to think differently around how patients are able to access us.
Virtual care is going to become a bigger part of our model in terms of what we offer. That's in service to create more access for our communities that we're serving, but it also recognizes the changing use patterns and familiarity that the non-Boomer generations have withregard to virtual anything. To keep up and to be relevant to our younger generations that are becoming a bigger part of our healthcare universe and ecosystem, we're going to have to offer different modalities of access for those folks, or we run the risk of losing their use of our system and our clinical teams as we move forward.
Working with the colleges and the high schools to generate more excitement and to create more capacity in the educational institutions that we rely on to create the supply of the next-gen of our workforce. That is going to be another arm of the work that we're doing in terms of identifying the volume gap that we have and how we start to stimulate more interest in younger people to get into healthcare, and then actually have the available chairs and institutions to train them as we move forward.
We recognize we can't just chase this problem with wages because that's not going to solve the problem for our communities. It's going to have to be a multi-faceted approach in terms of how we address the workforce as we move forward.
HL: What do you have in your strategic refresh around finances?
Matheis: Sentara [is] in a better place than a lot of the industry. We ended '22 with an operating margin. While we certainly felt the headwinds, and our net margins were not what they have been historically, we fared better than most across the industry. But still, we're going to have work to make sure that we have long-term sustainability as an organization.
We're focusing on the supply chain and opportunities on the supply chain front. Pharmacy is another area; pharmacy is the fastest growing line item for healthcare costs nationally, whether it's on the plan side of our organization or the care delivery side.
I do believe we're going to have to continue to grow as a health system, probably on the plan and care delivery side of our organization. We acquired AvMed, which is a 220,000-member health plan in Florida, both commercial and Medicare, and we're bidding on the Managed Medicaid program in Florida as well. We're going to have to look at scale as a lever for us in terms of being able to generate more efficiencies as an organization.
Getting ourselves crisp from an access and experiential perspective, we're going to have to put a lot into our digital assets as an organization, and those will not be inexpensive investments Driving scale is a means for us to be able to afford those investments to make sure that we're driving towards the experiential outcomes and the efficiency outcomes.
Finally, we are looking at length of stay in our hospitals and asking ourselves the question: can we improve our throughput for our admissions in our hospitals and make ourselves more efficient that way? That is going to require some serious effort on our team members' part to go there.
The benefit of doing that is threefold.
It helps create access for us, and in some of our communities we're tight in terms of our current bed capacity compared to demand. It actually frees up capacity so that we can see more patients.
It also allows us to lever our existing cost structure in a different way, versus the alternative [of building] new bed towers in areas where we're stretched from a capacity perspective. The challenge with that is not just the capital cost involved with that, but then would we be able to find staffing given the staffing headwinds that we're facing nationally? It's another lever that we're going to be focused on in terms of trying to make sure we're creating access for our communities, but it's also a positive financial driver for us organizationally.
HL: How does your background help you in your new role as enterprise CEO?
Matheis: I've been fortunate in my career. I've worked on the provider side twice in my career, as well as on the payer side. I'm a CPA by training so I'm a non-clinician, more business-focused.
[Over the years] I got to understand a lot about hospital finances, how hospitals work, as well as working with physicians. When I joined Sentara five years ago on the plan side, I had no idea that I was going to end up in the role that I am in today. I firmly believe that organizing the financial healthcare and the delivery of care within the same framework is where the world is headed from a healthcare evolution perspective. We've got bigger payers that are trying to move into components of the care delivery side of the house as we speak. But it really was with this notion of aligning incentives on the care delivery side and the payer side.
In almost five years I spent as president for Optima Health, I got to learn a lot about Sentara broadly, as well as focus on the things that I needed to focus on at the time in our health plan business. Coming into this role, I had a good perspective of the history of this organization and how it works, which has been a real benefit especially in my last six months.
The perspectives I bring are a little bit different because I have spent time in the payer world and understand what our customers want from us. I bring a broader view, perhaps, to this role, and I think that's going to be beneficial for the organization in terms of how we organize ourselves and meet our customers' needs, while at the same time making sure that we're continuing to drive that journey that we've been on, while we move ourselves more toward [a] consumer-focused organization.
It really is about creating the system to allow for things to be easier for people to experience their healthcare journey. The simplest example I can give is if you come to one of our EDs, we take a bunch of information about you and then you go home and perhaps you need follow-up care. If you go back to a new physician for that follow-up care or you need a test at another one of our facilities, we will invariably ask you for the same information again. What that screams to people is that we don't know you as a patient and as a customer.
Imagine a world where you've enrolled in Optima Health Care. We've taken a bunch of information from you, you go see a doctor, we've already populated everything that the health plan had into your record. You might provide some additional information with regard to your care status when you visit that physician, and then that information gets ported wherever you go within your health journey within our system. That's one example of the world that we're going to drive toward as an organization. It is all very doable given the technologies that we have deployed today.
One of the reasons I'm really excited about this journey that we're on [is that] as we go through it, it's going to make healthcare simpler, more seamless, and more accessible for people and that ultimately should translate into healthier individuals and people being able to live healthier lives.
HL: If you could change one thing about the relationship between payers and health systems, what would it be and why?
Matheis: There's no easy answer to that because you've got a hospital industry that's under serious financial pressure [and] national payers are still recording record profits coming out of 2022. Those facts make for very contentious relationships in terms of how the plans are working together.
The notion of One Sentara is to make a family work well together in a way that perhaps we've not even done internally. We've never really harmonized and asked how do we make things better together.
I'm excited about our journey and where it will lead, and hopefully that might become a model for others to pick up on as well as things move forward. How do we create more trust within our industry and work together to solve problems rather than perhaps work at odds with each other?
I've seen it on both sides of the fence and there are proof points on either side about who could do what to improve.
“I firmly believe that organizing the financial healthcare and the delivery of care within the same framework is where the world is headed towards from a healthcare evolution perspective.”
— Dennis Matheis, President and CEO, Sentara Healthcare
Melanie Blackman is the strategy editor at HealthLeaders, an HCPro brand.
Photo credit: Sentara Norfolk General Hospital, located in Norfolk, VA, is a 525-bed tertiary care facility. Photo courtesy of Sentara Healthcare.