Heyssel at Hopkins: The Legacy May Not Last


Robert Heyssel has announced his retirement as president of the Johns Hopkins Hospital. When he finally steps down at the end of the next full year, he will leave behind a remarkable record of achievement.

Dr. Heyssel has led the hospital through the most tumultuous 20-year period in American medical history. The carefree days of cost-plus reimbursement for medical expenses disappeared. Rapid changes have cast the health-care industry into a ferocious competition for increasingly well-organized and cost-conscious customers. While other big-city hospitals lost patients, hemorrhaged cash and then closed, the beds at Johns Hopkins Hospital remained full and the institution continued to earn a profit.

Under Dr. Heyssel's leadership, Hopkins expanded its health-care delivery capacities by acquisitions and mergers, formed the Johns Hopkins Health System, financed and constructed major new buildings, established the Dome Corporation, opened the Francis Scott Key Medical Center and created its own health maintenance organization, which it recently sold to Prudential for a tidy profit.

To no one's surprise, last year Business Week ranked Dr. Heyssel the best hospital chief executive in the country.

The turbulent dynamics of the American health-care business, however, will not permit Dr. Heyssel to leave behind a safe and secure institution in a calm and steady industry. His successor will confront the same overriding issue with which he dealt: How can an inner-city, academic medical center continue to compete and maintain its world-renowned reputation for excellence in a system driven by fierce cost competition?

Hopkins must successfully meet that challenge if Baltimore is to achieve its exciting vision for its future as an international life-sciences center. Hopkins medicine has now become the most important economic engine in our city.

Last winter, the trustees of Hopkins Hospital appointed a search committee to find Dr. Heyssel's successor. Before they make a final selection, however, they ought to make two major policy changes.

First, the present management structure of the Hopkins medical institutions should be redesigned to create one position with ultimate authority to resolve disputes and make decisions.

Hopkins medicine actually consists of two separate institutions -- the Hopkins Hospital and the Hopkins School of Medicine. Each belongs to an entirely distinct corporate organization. The medical school is part of the Johns Hopkins University. The hospital isn't. The dean of the medical school reports to the president of the university. The president of the hospital doesn't. Instead, the hospital and the university each has its own separate board.

When the president of the hospital and the dean of the medical school disagree, no one has the authority to resolve the dispute. Yet, of course, disagreements and disputes arise. The potential for them is built right into the relationship. The hospital and the medical school depend on each other. For example, faculty members at the medical school hold dual appointments and fill the important positions at the hospital.

The two institutions, however, have different priorities. The hospital's principal mission is to take care of sick people. The medical school's priorities are teaching and research. Since money, space, equipment and other resources are limited, conflicts inevitably develop, as they do in any organization. but at Hopkins they seem to fester and aggravate the normal difficulties which high-powered people sometimes have getting along.

There's nothing new in this. The hospital and the medical school have irritated each other for 100 years. And when they get bored, they both turn against the university's Homewood campus. But the hospital and the medical school must work together as a team when they compete for business against other medical centers. Insurance companies, health maintenance organizations and large employers negotiate managed care packages with one Hopkins, not two.

The selection of a new hospital president gives Hopkins Hospital and Hopkins University an opportunity to create a unified leadership system for the hospital and the medical school. Several different structures have been suggested. For example, the university and hospital boards could make a dual appointment of a chancellor for medical affairs to whom the dean and the head of the hospital could both report.

Of course, any rearrangement will create problems of its own. But they will not cost the institutions as much as the continuation of a divisive leadership structure.

The Hopkins Hospital's board of trustees should also make a second policy change. The hospital and medical school should together take the initiative to develop a strategy for the economic revitalization of the surrounding neighborhoods of East Baltimore. Hopkins should then persuade the city to join in implementing it.

Dr. Heyssel is deservedly proud of the improvements he has achieved in the hospital's relations with nearby community organizations. But as you drive around the area, one question becomes unavoidable -- how can Hopkins continue to thrive as an internationally acclaimed medical center in the middle of an urban ghetto?

The prospects do not appear encouraging. As you drive across Monument Street or down Wolfe Street, the Hopkins medical complex looks increasingly like a fortress. Parking and safety are major problems. they make it more and more difficult to attract patients and recruit faculty and staff. Security costs now exceed $5 million a year.

Hopkins understandably shies away from the responsibility. It is not after all an economic-development agency. But the medical institutions have an enormous and largely untapped capacity to generate local economic activity. While the city government seems to ignore that potential, the hospital and medical school seem content to ignore the problem. Looking ahead to the next 20 years, that doesn't seem like a viable strategy for either Hopkins or Baltimore.

Tim Baker writes on regional affairs.

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