Temple University Health System’s new CEO wants to create 5,000 ‘cost-conscious champions’ to save money and raise quality

Temple University Health System’s new chief executive says hospitals are like factories.

“We make health care. GM makes cars. If things work better, and you get out of the ER and upstairs at noon instead of 5, you get a whole day’s worth of testing. That means care happens faster,” said Michael A. Young, whose promotion from CEO of Temple’s flagship hospital was announced Thursday.

That means a patient receives treatment for an infection sooner, and that can translate into better care for the patient and better financial results for the hospital, Young said.

Young, a 63-year-old York County native, succeeds acting CEO Stuart McLean, who will return to the position of chief restructuring officer, which he has held since 2018. McLean had replaced Larry Kaiser, who stepped down as CEO in September.

“Michael Young is a highly skilled and experienced administrator who has done an outstanding job at Temple Hospital and deserves the opportunity to lead the entire health system,” Temple president Dick Englert said.

The management changes are part of a restructuring that Temple University announced in June 2018 in a bid to create a more financially stable future for its flagship hospital. That institution on North Broad Street is not only a vital provider of services to some of the city’s poorest neighborhoods but it’s also an economic anchor for North Philadelphia.

Without significant amounts of special state funding each year, the hospital couldn’t survive financially.

Young takes over a health system that is shrinking, with the pending sales of the Fox Chase Cancer Center and Temple’s interest in Medicaid insurer Health Partners Plans Inc. to Thomas Jefferson University for undisclosed prices.

Young has experience at safety-net hospitals in worse shape than Temple, he said. Those hospitals were Erie County Medical Center in Buffalo and Grady Memorial Hospital in Atlanta.

In Atlanta, after a new board made up of corporate leaders launched a bid to keep the perennially money-losing Grady from closing, it hired Young in 2008 to execute a turnaround.

While at Grady for about three years, Young cut some jobs, but also focused on increasing efficiency in the hospital, and played a part in convincing Atlanta philanthropist Bernie Marcus to donate $20 million to expand Grady’s stroke care, according to the Atlanta Journal-Constitution.

Grady has operated in the black most years since Young instituted his changes there, according to its 990 tax forms.

When Young announced his departure from Grady in 2011 to become CEO of PinnacleHealth in Harrisburg, the Journal-Constitution described him as “a hard-charging executive with a sometimes abrasive manner who helped save the immense safety-net hospital from total collapse.”

Since starting at Temple in August 2018, first as chief operating officer of the hospital and then as CEO starting last January, Young has been trying to build a culture of efficiency by training everybody, physicians, in particular, in the intricacies of what things cost and telling them they are responsible for that cost, not the chief financial officer, Young said.

“Now we have 5,000 cost-conscious champions, instead of just four or five people. It’s an education process of the entire staff. We’ve gotten tremendous positive momentum doing that,” he said.

Young also cited declining infection rates both as a way to not only improve care but also to save money and even increase revenue. For example, there have been no infections following 215 hip replacements from July 2018 through December, compared with three infections after hip replacements in the year ended June 30, 2018.

“It’s obviously better for the patient. It’s way less costly for us to do, and each one frees up 10 bed days for another admission,” which boosts revenue if the bed is filled, Young said.