March 16, 2023
Mr. Generale believes that effective healthcare leaders must be able to adapt and pivot when new strategies are needed.
This episode was made possible by our partnership with Citi.
Dr. Gary Bisbee: Good afternoon Paul and welcome.
Paul Generale: Hey Gary. Good afternoon and thanks for having me.
Dr. Gary Bisbee: Absolutely. We’re about leadership here. It’s always been interesting to drop back with our guests and find out about how they thought about leadership at an early age. So what did the young Paul think about leadership?
Paul Generale: Yeah, it was all the good stuff. It was that a leaders defined by their title. It’s all about the title and the organizational chart under you until you really realize your title. And the org chart has nothing to do with leadership. And you come a long way. And it’s really about working as a team and listening and having humility. And, titles don’t create leaders.
Dr. Gary Bisbee: Yeah, for sure. How, that’s an interesting message in that I suppose it. Could be challenging to present that message to young leaders. How do you think about doing that with the young leaders with whom you work with?
Paul Generale: We always have good case studies with the current leaders in the C-Suite about you. You don’t always go forward, you go sideways. You learn everything possible. And it’s not what you know, it’s when you’re ready and you have the ability to show that you’ve developed a team and skillsets that make you right for a leader. And so it, it is when people say you have this title, or I’d like this title. It’s good to reflect on personal experience and examples.
Dr. Gary Bisbee: Yeah, for sure. What about healthcare? When did you become interested in healthcare, Paul?
Paul Generale: I lucked out. God put in my path in college, two roommates and one had a father that was a chief of staff, a general surgeon in Houston, and the other was a large healthcare system executive. And so got to know both of them very well and did a lot of listening about all the different paths in healthcare from. Finance to quality to physicians. It just has so many facets that it really ped my interest. Did some internships with hospitals and ended up moving to Houston and got an interview with the roommate whose dad was a surgeon in my first hospital right outta college. So great experience and just great mentors.
Dr. Gary Bisbee: Let’s follow up on that. How important in your early days as you were in administrative Positions, how important was that to your current roles?
Paul Generale: Gary was foundational and one of the best pieces of advice when I was looking at opportunities was the CEO that was interviewing me say, I’m gonna put you in a hospital and you’re gonna get the chance to make a lot of mistakes, but learn the ins and outs. From food service to imaging, to lab to ORs, and just for a leader. I think it’s key when you really get grounded in what makes hospitals, what makes a healthcare system work.
Dr. Gary Bisbee: So among your current roles as Chief Strategic Officer at Christus Health, what kind of skills do you need these days to be a strategist for a multi-billion dollar health system?
Paul Generale: I think it’s applicable to be able to have ocu and lay clarity on strategy. And it’s not chasing things, but it’s having a plan that you can measure. Tactics that you can execute on and show to, whether it’s the board leadership or the associate that here’s where we’re going. And being able to articulate those and pivot. I mean we, we lay strategies and tactics that work and when they don’t, we don’t sit there and wait too long. We take action. You learn to pivot and something that also I think is a leader, it’s okay to make mistake. And learn from those and learn how to tweak. So all that really goes into our strategy, how we operationalize it, and how we really, take that to the associates,
Dr. Gary Bisbee: . I’ve heard some executives talk about change in terms of incremental steps. How do you think about change going forward at Christus?
Paul Generale: I don’t wanna always lead and be the first to do it. I think that comes off really good to a lot of people. And what we like to do is be innovative and be not small steps, but take the right steps, the right pace to not just be status quo, but not to be the first to market necessarily. And we’ve been around for over 160 years and so we have a lot of lessons learned on that.
Dr. Gary Bisbee: That’s a nice lead in. Could you please describe Christus? Forest Paul,
Paul Generale: Absolutely. Christus is a Catholic, faith-based, international health system. We’re based here in Ivie, Irving, Texas. We have about 50,000 associates, 15,000 doctors, and we operate in the US and Latin America.
Dr. Gary Bisbee: and what’s the distribution of inpatient versus outpatient these days? Has that evolved over the last, 10 or 15 years?
Paul Generale: It’s evolved in the past, I’d say five years. Our inpatient to outpatient mix was 60 40. Today it’s about little over 51% outpatient ambulatory health plan and 49% inpatient.
Dr. Gary Bisbee: Okay. Do you see that trend continuing? Paul?
Paul Generale: Absolutely. I think with everything we’ve seen over the past 36 months, the innovation in digital, the care continuum and Medicare and other regulatory payers moving things to outpatient, we’ll continue to see that,
Dr. Gary Bisbee: what about the holding company versus operating company model? Where does CHRISTUS sit on that Continu.
Paul Generale: With the support of our board and our C E O that came in 11 years ago. We are a hundred percent operating company. We think that you have to be with everyone in the field regardless of what country it’s in. You have to get your hands dirty and you have to support each other. So we have centralized services here that provide services to all of our countries, all of our services, and we just feel that, our philosophy is to be an operating company.
Dr. Gary Bisbee: How would you describe Kris’s strategy over the next five years? You’ve made suggestions about that as we went on, but let me ask the question directly. How would you describe Kris’s strategy over the next five years?
Paul Generale: We use a term of being essential, and so right now we touch about 6 million. Our goal is to touch 10 million lives. And the way we want to do that is truly integrate that continuum. So you’ve got a lot of different competitors coming in the space, and from the acute care capital intensive, all the positions inpatient, we’re building out the rest of the access for digital primary care partnering where we may not do something, whether it’s in home health or hospital at home. So we really want to own that and we wanna own that. So when Gary or loved one comes. It’s one touch and we can navigate you through that continuum versus different fragments that we’re seeing where someone’s picking up a digital primary care piece, but they not, they may not have the specialist, or they may not have the emergency room or the inpatient care. So that’s how we define essential, and that’s really our strategy.
Dr. Gary Bisbee: Okay. Where does the CHRISTUS Health Plan fit into your strategy going forward?
Paul Generale: We really think loyalty’s with a member. So if someone’s in the health plan, and that gives us a chance to take full risk. So right now we have 250,000 covered lives in our networks. We’re taking risk on half a billion dollars. . And so as you look at care navigation, care navigators, it gives us a chance instead of just being fee for service to really figure out how can we attack some of those social determinants? How can we do care at the home? It’s really been, Gary, transformational for how we provide care. In the last three years with our ACOs, we’ve saved over a hundred million dollars from cms. So it, it really wouldn’t call it a test lab per se, but it really is for a healthcare system, a chance to take risk and play in that field.
Dr. Gary Bisbee: Covid challenged all of our health systems substantially. Really. Were there any positives coming out of covid? Things that you did because you had to do that turned out to be a positive?
Paul Generale: I think they had to do is key and everybody really digital and the technology and telehealth. We went from doing 10,000 visits a month to over 120,000 visits.
Dr. Gary Bisbee: Wow.
Paul Generale: We also learned, you need to use the hall. We did a lot of visits with home care, a lot of testing bringing our nurses there. And so looking at different venues, looking at how can you appropriately use, instead of everything going through an ed, urgent care, primary care in different ways where there’s a drive up. And so I would tell you it goes to really care navigation and is there a different way to do it? And we. Beyond Covid and with staffing shortages, everyone’s looking how to be more innovative in providing care. And so I really think that probably accelerated that curve exponentially.
Dr. Gary Bisbee: Yeah. And do you think it accelerated, in a sense, is not gonna drop back? Completely. It will be a change in the way that we deliver medicine in this country.
Paul Generale: I think it’ll band, but not much. As we are all seeing with Amazon’s purchase of one Medical with Aetna slash cvs, the new entrance that, that, I have a vested interest in using that technology. I think that curve’s gonna keep moving upward and we’re gonna adjust with it.
Dr. Gary Bisbee: Can you describe the Latin American operations for us please?
Paul Generale: Absolutely. So we currently operate in Mexico, Chile, and Columbia. A little over about 1,000,000,002 in revenue there. So it’s significant. It’s something we’ve been in Mexico for over a decade, so Mexico and Chile are very similar to the us maybe about 10 years. Probably looked like US healthcare 10 years ago. Very acute, not a lot of ambulatory. Whereas Columbia is very different in the sense of they really look at universal health and I would say Columbia is really a picture of a capitated. Everybody has health insurance, so hospitals are much smaller. MOS have doctors, treatment rooms, lots of home health visits with digital and so it’s really shows you when the payment system split one. The market, the ministries will react differently and create that ambulatory presence.
Dr. Gary Bisbee: Have you seen enough? Columbia to make any conclusions about the US and could the US change to that kind of model if if it was the right thing to do?
Paul Generale: I think Columbia’s still trying to figure out how well it works. What we try to do is take the best practices, for instance in the US where we can look at more ambulatory in Mexico and in Chile, where we can build more moabs and look at the things, the best practices that have helped us healthcare. And in Columbia, we really expanded our digital and home health footprint based on what we’re seeing in Columbia in our primary care prisons. Everybody’s got as the, that best practice, but we haven’t seen one that just says, aha. That’s the way to do it, is an entire ecosystem.
Dr. Gary Bisbee: Yep. So we’ve talked about how Covid has changed the US healthcare system, or at least is changing it. That true also for the three countries that you service in Latin America.
Paul Generale: I’d say not as quickly as the us but you’re seeing definitely interest and new entrance going in there that that, that curve will start to look like the US for probably in the next five years.
Dr. Gary Bisbee: I see. Interesting. So is the corporate management team, the corporate executive team at Christus. Also do Latin America. So the same like in your case, you do strategy and network for both America, both the US and the Americas.
Paul Generale: We do, our executive team up here is very involved in US and latam, and of course we’ve got great CEOs and leadership teams in the US and latam, but we work closely with them. and we are involved,
Dr. Gary Bisbee: So thinking again about leadership, what’s the biggest challenge that you’ve seen over the 25 years or so that you’ve been a healthcare executive?
Paul Generale: With leadership. It’s really that passion in wanting to get in there and learn it and having those mentors that can teach that you need to have trust, you need to have a team that you can build. And right now I think everybody, across every branch in the healthcare system from clinical physicians, leaders there’s just a shortage of that. I think a lot of industries are dealing with that, and we spend a lot of time on getting in the right residents and teaching, do a lot more listening, change and evolve how we innovate healthcare and how we find leaders. But that’s been probably the number one challenge.
Dr. Gary Bisbee: We’ve seen over the last 10, 20 years the amount of federal dollars going. Healthcare increase of course. And today most of our large health systems are 50, 60, maybe even 70% of the revenues come from federal government. That’s going to continue to grow as we have more baby boomers, more chronic disease and so on. What, how do you see that presenting challenges or change for Chris?
Paul Generale: For Christus, we. It’s ironic, I’d say now we’ve been blessed for having those rural ministries and having a high percentage of Medicare, Medicaid self-pay. It’s who CHRISTUS is. And so that’s taught us that your biggest strategy is you have to be an operator. You have to be operationally lean. You still have to get the best talent. And so we’ve spent a lot of time on. What does that foundation look like? And that’s what made us have to become an operating model is you have to use every resource you can and you have to be lean. So as you see more Medicare and Medicare advantage, you’re working with, you’re really working with less premium fees. And so you have to be smarter how you do it. The health plan has helped us, learn how to take risk and just the markets we’ve been in haven’t given us really that luxury to say. We have this excess revenue that’s commercial.
Dr. Gary Bisbee: Yep. What do you think, Paul, about the large well financed systems elbowing the way in the primary care, I’m thinking c v s and Walgreens and Walmart and Amazon and so on. How do you think about that in terms of how it might change? Healthcare and might change our health systems in the way they’re delivering healthcare.
Paul Generale: We know they’ve got the financial wherewithal and the balance sheets to do it. So it’s not gonna be a short-term play. It may change over time. So it goes back to and, I like your strategy question. We have to have a strategy that they’re gonna be here. So how do we do it better with our primary care? Integrating them to where you can have an experience that we’re not passing you off if you’re not buying a prescription from us, from your primary care doc. So we see that’s that essentiality, that it’s a new competitor and they’re gonna be here play for a long time.
Dr. Gary Bisbee: We’ve seen, of course a number of physicians now being employed by health systems. Is that true in the Latin American countries as well as the us?
Paul Generale: No, not yet. It’s, it will be coming, but right now, Mexico Chile’s very academic, but independent, and Columbia as well. It’s large health plans there, so really, There’s not a best practice there. There’s some good lessons learned in employing positions, but not yet.
Dr. Gary Bisbee: Yep. Good. Paul, this has been a terrific interview. Thank you for your time. I’d like to ask one last question if I can, and that. Is, I’m sure you have people coming to you every day and asking for advice, but what advice do you give up and coming leaders?
Paul Generale: Take some risk find somewhere where you can learn and it, it’s really take some risk, learn. Try to evolve. There’s not a path. It’s, here’s where I want to be in five years, have that vision. But there’s a path that God has and I think find the right organization where you can have fun. And sometimes people forget to say that I truly love what I’m doing. We’ve got a team that believes Spawn is one of those core values that you have to have. And just get in somewhere. And it’s what the first mentor ever told me. Why don’t you be somewhere where you can learn everything possible? If you find an opportunity, take it.
Dr. Gary Bisbee: Great advice. Thank you, Paul for your time Much.
Paul Generale: Thanks, Gary.
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