Hospital exec from N.Y. to run Grady

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UPDATED: 5:55 p.m. July 21, 2008
Hospital exec from western New York to run Grady
Previous CEO Pamela Stephenson gets $150,000 separation deal

By CRAIG SCHNEIDER in Atlanta, GAYLE WHITE in Buffalo
The Atlanta Journal-Constitution
Published on: 07/21/08

A huge piece of the plan to rescue Grady Memorial Hospital was finding a talented, aggressive leader who wasn't afraid of Grady-sized challenges: too little money, too many poor patients and declining government support in a sticky political universe.

[Post comments below.]

Michael Young ran the Erie County Medical Center Corp. in western New York.

Michael Young's employment package

Three-year agreement
Sept. 1 effective date
$615,000 base salary
Bonus potential - up to 50 % of salary ($307,500)
An apartment for 60 days
Up to $40,000 in relocation costs

Pam Stephenson's departure terms

Two-year contract is nullified.
She will vacate Sept 1.
$175,000 bonus. Expected to be approved by Grady board in August.
Severance payment of three months salary, or $150,000.

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Monday the Grady board announced that their choice to rehabilitate the state's largest, busiest and most-troubled medical system is Michael Young, 52, who for three years has been CEO of a similar but smaller urban hospital.

At the same meeting, the board removed the most recent in a line of CEOs whose efforts couldn't forestall a financial crisis so severe it threatened to close the hospital last year. Hospital CEO Pam Stephenson will leave Sept. 1 when Young takes over.

"Grady is such a special place for Georgia and the Southeast," Young said from Buffalo, where he heads the Erie County Medical Center Corp. "I want to see if we can't put it back on the strong platform it needs to be on."

He added after a press conference Monday in Buffalo, "If it wasn't Grady, I wouldn't have taken the phone call."

Young gets a three-year contract paying $615,000 a year, slightly more than his predecessor. An exceptional performance could earn him a $307,500 bonus.

In an unexpected twist for such announcements, Grady officials went beyond citing Young's achievements and acknowledged he has struggled with alcoholism.

Grady board chairman Pete Correll said Young entered a rehabilitation clinic five years ago and has become a "model of how to handle" such problems, a reflection, Correll said, of his strong problem-solving skills.

He takes over a hospital drowning in debt, struggling with antiquated equipment and dwindling government aid.

At the same meeting Monday morning, the hospital's new non-profit board announced a $325,000 separation deal to remove CEO Stephenson.

Her departure ends an embarrassing chapter during which Stephenson was accused of trying to profit from her hastily arranged tenure as the hospital's chief and her quick removal, widely considered inevitable.

The unanimous choice of a new CEO marks another significant step in defining a new Grady. The century-old hospital is Atlanta's top trauma hospital and its last refuge of care for the poor.

The transformation began a few months ago when a new nonprofit board took control of the hospital and continued Monday with the board members appointing their main agent of change.

"This is the right step in the right direction," said John Eaves, the head of the Fulton County Commission, which provides about $80 million a year in Grady funding.

Correll praised Young for turning around two failing hospitals. Both Grady and Young's current hospital in New York are urban teaching hospitals that largely serve the poor.

Young has more than 20 years experience as a hospital CEO. He said he reduced emergency-room delays at Erie ? also a problem at Grady ? and increased admissions and revenues.

"We at Erie County Medical Center were losing $30 million a year [before I came]. Last year, we made $17 million in operating profit, " Young said. Grady's annual deficit is $43 million.

He also helped turn around Lancaster General Hospital in Pennsylvania.

Correll said Young has made his problem with alcohol public.

Young said Monday, "I have a disease that everyone scorns and no one wants to talk about. ... I think it makes me more knowledgeable about patient care and more empathetic."

Grady's struggles and its rehabilitation effort have met with skepticism and criticism from elected leaders on one side of the issue and advocates for the poor on the other.

Legislators and county officials — Fulton and DeKalb help fund Grady — have been reluctant to increase funding because of the hospital's financial performance.

On Monday, some officials praised the hiring as a new start.

"Michael Young is highly qualified and has an excellent track record as an administrator," said Ron Sauder, a spokesman for Emory University School of Medicine, which supplies many of the doctors at Grady. "We look forward to working with him to achieve positive results for Grady and all the patients whom Grady serves."

The Grady Coalition, a citizens group that has been critical of changes at the hospital, offered guarded approval Monday.

"He kind of stood out" among the CEO candidates, said coalition leader Rev. Tim McDonald. "He has a knack of bringing the community together."

But McDonald worried that Young will cut services to the poor to balance the hospital's bottom line.

"We will not balance this budget on the backs of the poor," McDonald said. "We will not tolerate layoffs or the closing of key clinics without protest."

CHALLENGES AHEAD

New Grady CEO Michael Young has formidable challenges ahead as he tries to turnaround the huge hospital.

Massive debt — Grady ended last year $43 million in debt and continues to bleed millions every month.
The lack of paying patients — Grady in large part serves the poor and uninsured, resulting in millions of dollars in uncompensated care.
Trauma Care — Grady, which is Atlanta's only top level trauma unit, loses $40 million a year providing this expensive service.
EMS — Following a recent $6.8 million cut in emergency ambulance funding from Fulton County, Grady officials are concerned longer response times may result in lives lost.
Accreditation — The hospital's accreditation appears threatened following a critical review.

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Comments

By Sad Brother

Jul 22, 2008 3:35 PM | Link to this

"I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character."

Stephenson... you go girl..... to JAIL!

Read and weep Beasley. Get yo head out of da sand or wherever it might be!

By catlady

Jul 22, 2008 2:02 PM | Link to this

Joe: well, if it takes putting a white Yankee in charge to fix Marta and Hartsfield, I am all for it!

By Pam is a lying HO

Jul 22, 2008 1:10 PM | Link to this

WHAT? They hired a DRUNK to replace a FAKE LAWYER? I don't know which is worse, a dry drunk (think gwb) or a lying fake lawyer....How does on file a complaint with the Georgia State Bar about one of their lawyers who you suspect of not having the required college degree in law? I sure hope someone has filed such a complaint...I looked at the State Bar's web site, but could not locate anything relating to filing complaints....

By typical georgian

Jul 22, 2008 1:09 PM | Link to this

great! just what we need another yankee coming in to solve our problems. why don't they all just go back home!

By give me a break

Jul 22, 2008 11:56 AM | Link to this

Once she leaves Grady with her overpriced severance, she still remains on BOTH boards. Given everything, how can this continue? How is someone removed from the board?

The pathetic, poorly written and error ladden press release entitled "Pam Stephensen is GOOD for Grady" (just more time spent justifying herself and wasting our tax money in the process) was just such a lame joke. It was sad actually. It is like we have children down there trying to run the place. I don't get it. She thinks the AJC was out to get her, but they are just working with the facts. And the facts make it appear the complete opposite of the now infamous press release title. She is NOT good for Grady. Or the tax payers who support Grady. The media doesn't have to make things up, Pam makes up enough on her own (oops! word procesing error) for them to have plenty to write about!

By whatweryouthinking

Jul 22, 2008 11:25 AM | Link to this

Whatever happened to due diligence? Every person on the board should be removed for failing to do do their job.
As for the severance, perhaps a civil suit to recover the money would be in order. Who wrote the contract and omitted the paragraph about false representation / lying / morals being grounds for dismissal with NO severance? Does Young's contract have such a clause? Ineptitude has just rewarded a liar.

By interested_bystander

Jul 22, 2008 11:06 AM | Link to this

I agree with "Give me a break".

The one thing that isn't noted - did the "severance" agreement include any stipulation that if Stephenson was found to have misrepresented herself, that the whole deal would be void? I mean, she was a candidate for this role (in her mind, anyway!); she obviously had submitted information with material lies. Any other place, having falsified information on a job application is grounds for dismissal, for cause.

If she did indeed make these submissions with significant factual errors, then she should pay the price. Dump her, have the Fulton-DeKalb board vote her off, and get her out of all roles related to Grady.

By Grady Coalition

Jul 22, 2008 10:15 AM | Link to this

Huh, whats the problem?

Grady-Georgias largest hospital and level 1 trauma center losing multiple millions.

Medical Center of Central Ga. in Macon, Georgias second largest hospital w level 1 trauma unit, with basically same patient mix, making a profit.

Huh,huh,huh! We don't see why Grady should make any changes!

By Q2A

Jul 22, 2008 10:07 AM | Link to this

It is unfortunate that we live in such a racially polarized society. The problem with Grady did not have anything to do with the Black leadership running Grady. Grady's problems were due to the ill will of a few white politicians, including Sonny Purdue. A smear campaign was also launched against Grady's black appointed officials by the white controlled media, lead by the AJC. This effort was to get the larger white community in agreement with the message of black leadership incompetence at Grady. Part of that message also included the fact poor indigent African American's and other people of color had and were continuing to receive expensive hospital services for free. This was claimed to be the main reason Grady was in financial trouble. Nothing could have been further from the truth. The real reason Grady lost money was due to the restrictive charter (business model) it was forced to operate under. This charter which was set up when Grady was first formed prevented Grady form charging for many of those high end services other hospitals are able to charge for which generate profits for them. The solution could have simply been to amend the charter to allow Grady to charge for those services. This is where the ill will of the white community and its leaders reared their ugly head and prevented the Grady charter from being amended. If it had been allowed to change its charter to reflect the changing times, Grady would have had the ability to compete for money paying patients. The result would have been that money would have been siphoned away from some of the other metro Atlanta area hospitals and this was not going to be allowed to happen, at any cost. Now, Grady was fighting against white protectionism as well. With so many conspiring against Grady and its black leadership, Grady never had a chance. Now, white folks are calling the shots but in reality they were calling the shots all along. Now you know.

By Bravo

Jul 22, 2008 9:42 AM | Link to this

Her resume's "falsehoods" are due to a "computer error"? Give me a break. Her "computer error" should read LIE. She should be fired immediately (like anyone else caught falsifying a resume) and NOT receive the HUSH money severance package. She is a DISGRACE! Who authorized this deal? They should be rooted out as well. Let's get Grady back on track and "NO Mo Money" fo the cheaters! Shame on the "deal makers" as well!

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