The MED Reborn
After a decade of struggle, the MED is back from the brink, profitable, with new leadership, an invigorated staff, and a grand new vision of the future. It may shock you.
photographs by Larry Kuzniewski
Today, Dr. Reginald Coopwood is CEO of the Regional Medical Center at Memphis (The MED), but he started out as a surgeon. It explains a lot.
“You have to pick a field that fits your personality,” Coopwood says in an interview with MBQ conducted at The MED in September. “Surgery was intriguing to me because I could do something: If you come in in pain, I can take you in surgery and take away that pain.” Contrast that to the experience of a psychiatrist or internist, where wellness is relative and a cure may be elusive or nonexistent.
Coopwood practiced as a general surgeon, which shouldn’t connote a pejorative. “The reality of being ‘just a general surgeon’ is you can handle most surgical problems,” Coopwood says. “I didn’t operate on the heart or bones or brain, but anything else I could handle.”
There’s no experience like performing a surgery, he says. “I loved doing surgery, loved the thrill and excitement of the surgical arena, the opening and closing of the patient. When it’s time to make that incision, everyone is focused on the patient and you’re the leader in the room. Everyone’s desire is making sure the patient does well. The surgeon is the conductor of all the moving parts. You’re at the center but everyone is moving together.”
Coopwood exhibited leadership capabilities that he himself didn’t identify. But his superiors did, and his career took a different tack as he became Chief Medical Officer of Nashville General Hospital at Meharry in 2000. He still performed surgeries, but he added crucial administrative duties. “I started developing leadership attributes, making a transition from orchestrating an OR to leading an organization through change and challenges,” he says. In 2005 he was named CEO of Metropolitan Nashville Hospital Authority, permanently trading his scalpel for a pen. After five successful years there, he took over as CEO of The MED in March 2010.
Running a hospital isn’t all that different from being a surgeon, Coopwood says. “With the responsibility and thrill of leading an organization, I traded one drug for another.” He laughs and says, “For lack of a better word. They both create that euphoria that drives us and excites us about getting up every morning.”
He adds, “I can’t hang out in the OR because the juices would start to flow again.”
The same personality traits that led him to being a surgeon have served him as an administrator. “I can be CEO because I can affect change.”
If ever there was a place that needed a change, it was The MED in the first decade of the 21st century. The public hospital with a Level 1 Trauma Center is the safety net facility for a 150-mile radius. That means the most dire medical cases in a multi-state region wind up at The MED. It also means that The MED will treat those patients regardless of insurance coverage.
The hospital was chartered in 1829 as the Memphis Hospital and charged with containing the diseases brought in from Mississippi River travelers. Physicians fought cholera and other epidemics, and it served as a federal military hospital during much of the Civil War. It was returned to the state of Tennessee after the war, but the Tennessee legislature abandoned it and granted title to the City of Memphis. It was funded by a special tax.
It received a major bequeathment from Theresa Gaston Mann in 1929 and was renamed after her husband, John Gaston in 1936. It’s major funding came from her philanthropy, the city, Shelby County, and a grant from the Public Works Administration. The E.H. Crump Hospital was built in 1956 to serve African-American patients. The Newborn Center opened in 1968. In 1983, the Elvis Presley Memorial Trauma Center opened and the hospital became the Regional Medical Center at Memphis. The intervening years saw the Firefighters Regional Burn Center, the Wound Center, a High-Risk Obstetrics Center of Excellence, and a myriad of other clinics and service facilities. More than half of the physicians in Tennessee receive all or some of their training at The MED through its affiliation with the University of Tennessee Health Science Center.
Because it receives funds from a number of state and local governments, and those entities were going through budgetary crises, The MED wasn’t getting the money it needed to operate effectively. It was losing patients at an alarming rate, was a money loser (more than $30 million in three years), and news headlines reported seemingly daily on the hospital’s dire situation. Talk rumbled of shuttering The MED.
The low point might have been when The MED ran through five CEOs in 18 months and there was considerable turnover on the board of directors. Tammie Ritchey knows because she was there. Ritchey took charge of The MED Foundation in 2004; when she was hired, it was a small foundation staff, but hospital leadership was stable and grant money was coming in.
That was before the economic realities hit, changes in insurance and TennCare meant seismic changes in the influx of patients, and a rash of executive turnover plagued the hospital. The MED was eating million-dollar medical bills from uninsured patients. To Ritchey, the biggest challenge was the vacuum left by a lack of leadership. “The staff, physicians, and nurses banded together and did the best we could with what we had,” Ritchey says. “But when you start losing people at the top you lose them at the bottom, too. We were still able to deliver quality care, but you can’t plan for the future.”
Most of the rest of the decade was characterized by damage and damage control. The MED had become a bad word. “It reached a critical financial state — days of cash in single digits,” Coopwood says. “What was in the press was real.”
It made it borderline impossible for Ritchey to raise money. The MED Foundation raises non-operational funds (operational funds come from revenues and public sources). “The community was faced with having to truly imagine what Mid-South healthcare would be like without the MED. In terms of raising money, those were bad years.”
A management firm, FTI Cambio, was contracted to get The MED under control. In 18 short months, the company reduced costs, made the place more efficient, and stabilized the trajectory.
Coopwood knew of The MED from its medical reputation. “Everyone spoke of The MED with reverence, of its value.” When he began exploring taking over, he learned more about the financial realities, which he hadn’t heard as much about in Nashville. But he saw a lot of promise in the institution. Coopwood was hired to take over in 2010.
His first days on the job were challenging. The management company did good work at The MED. Nevertheless, as scheduled on February 28th, 2010, the CEO, CFO, COO, CNO, and CMO of The MED walked out the door and the next day Coopwood walked in as the only member of administration.
The CFO he recruited, Rick Wagers, started the next week. He and Coopwood, self-described “upside guys,” both looked at the positive to build upon. “Because of the persistent history of struggling, not many people shared the upside view,” Coopwood says. “My CFO and I were fighting the fight that The MED could be better and different.”
One group to be counted on was MED physicians, nurses, and staff. “I walked around and saw that people weren’t believing [a dire prognosis],” Coopwood says. “People weren’t jumping ship. As bad as the press was on the organization and as dismal as the future was painted, folks were head-down and working for the patients because they cared about this place and believed in its mission.”
Coopwood’s plan was seemingly simple. The cuts had been made by the management firm, so now it was time to grow. “One of the things that I learned and fully believe is that you can’t cut yourself to prosperity,” he says. “You can cut yourself and then layer on a growth strategy to reach prosperity.” He saw that if he could maintain expenses and find ways to create revenue, there could be a new trajectory: upward.
New revenue streams have been created by expanding services and, crucially, revenue was protected by improving customer service and making sure that patients who came to The MED who could afford to transfer when they recovered, didn’t. “When I came here, the statement was, ‘If you’re in a bad wreck, go to The MED, but when you wake up, get out of there.’ By not managing that, the organization lost millions of dollars. When we can discharge, we can bill and collect for the full amount. Just that alone changes the revenue picture.”
The MED’s payer mix (revenue coming from private insurance, government insurance, or individuals) in 2010 was more than 30 percent uninsured. Today it’s about 26 percent. “That doesn’t mean we kicked anybody out of the hospital; we just grew the end with more government and commercial insurance. When you exchange one percent of uninsured with one percent of commercial, the revenue swing is 200 percent.”
The four years prior to his arrival, The MED lost money; $20 million dollars in 2009. His first full fiscal year, The MED made $17 million from operations.
Coopwood deflects credit. “The best asset The MED had was the people. I didn’t have to convince people that The MED is great. I had to convince them that we can be great if we change how we do things.”
The MED Foundation has seen the bump. From fiscal year 2010 to 2012, there was a 70 percent increase in total contributions.
“When you bring in someone — it didn’t have to be me — who has a vision of something different, with the drive to say we can be better and the leadership to take us there, the employees were so ready and willing to grab hold and see somebody who saw their value and the value of the organization,” Coopwood says. “People ask, ‘How did you do it?’ It’s not magic. It started with creating a vision that people at first didn’t believe, and then seeing them buy into it, start executing on it and driving the results we’ve seen. And when you look to the future, the opportunities are significant.”
A stable Regional Medical Center a specialty hospital for critical patients, and a safety net for the area’s uninsured: That sounds like victory.
That’s not how Coopwood sees it. His work is just beginning, and where he wants to take The MED next may surprise Mid-Southerners used to the notion that it’s struggling or maybe just happy it’s not in the news anymore. After all, he acknowledges, “The beauty of low expectation is that it isn’t hard to beat it.”
The MED’s leadership has very high goals. For starters, they want to be a hospital of choice, competing with other health systems in Memphis, such as Baptist, Methodist, and Saint Francis. “We’re not a step below the other hospitals here, and we can’t be or see ourselves as second class to them,” Coopwood says. “In 10 years would I expect people to drive from East Memphis past some very nice hospitals to come down here to get care? Absolutely. What we plan to deliver here is something that will make them want to drive past other hospitals, not because they’re bad but because what we’re offering here is worth it.”
The MED is replacing its campus — a notion much larger and more significant than is suggested by six little words. It’s a big endeavor and leadership is currently implementing its strategic plan to get there. “It will be state of the art, second to none in the region,” Coopwood says.
That’s just the half of it. The MED aims to rank in the class with academic hospitals nationally, such as Ochsner, the Mayo Clinic, Vanderbilt, and major medical centers in Boston, Chicago, and Cleveland. “Our goal is to be an academic medical center,” Coopwood says. “A true academic medical center where you’re able to do translational medicine that is cutting edge, in concert with the research you’re doing on disease processes and deliberate care and efficiencies.”
It’s a huge goal, and will be realized in installments over the next decade or more. “I can’t dream about building a campus I can’t pay for,” Coopwood says. The MED is starting the transition with new and upgraded facilities it is paying for out of its own operating funds, a kind of earnest money statement to the community.
Ritchey’s team at the foundation is planning strategically for the fundraising effort to come, including getting feedback from the philanthropic and corporate communities about what kind of funding to expect. “There are many philanthropists who find it attractive to get in on the ground floor, who like the very ambitious vision, who understand it and want it for Memphis and Shelby County and the region, and want to have a hand in building it,” Ritchey says.
“I want our city to want something more than good enough,” she says. “I want our city to believe that we can be great. The MED can be the Mayo, Memphis can have that here. It’s going to take time, vision, and the hospital’s money and philanthropy. But it can happen.”
But the future has already started. “We want to be a hospital of choice even before we get the new building,” Coopwood says. “We want to create our services to be efficient, second to none, and not let the building define it. We have to be great in our current environment. Once we cut the ribbon on our new building, that’s icing on the cake to convince the last few holdouts.”
CEO, Regional Medical Center at Memphis (The MED)
Born in 1960 and raised in Nashville
His father, William Coopwood, was a psychiatrist. “I grew up in an environment where healthcare was an aspirational thing. I’m sure I wanted to be a trash man or fireman at some point, but my earliest remembrances are of wanting to be a doctor.”
M.D. from Meharry Medical College in Nashville
Practiced as a general surgeon from 1990 until 2005
Served as Chief Medical Officer at Nashville General Hospital at Meharry, 2000-2005, and Chief Executive Officer at Metropolitan Nashville Hospital Authority, 2005-2010
Named CEO of The MED in 2010
Says, “A good leader provides vision and understands the big picture. They also hire capable, motivated people who can embrace the vision and then get out of their way. Successful people working together toward a common vision will drive the organization forward.”
Board Member, March of Dimes, QSource and Mid-South e-Health Alliance, and Tennessee Hospital Association. Member, UTHSC Chancellor’s Advisory Board and Leadership Academy Board of Trustees.
Has five children, and his wife, Erica, is from Yazoo City, Mississippi
Executive Director, The MED Foundation
Born in 1971 and raised in rural North Mississippi and in East Memphis
Graduated from Ridgeway High School, received a bachelor’s in English lit from Rhodes College, and a graduate degree in Afro-American Studies from the University of Wisconsin
Says studying African-American literature, music, history, and culture “opened up the world to me. It felt like I needed that information, and that was the only way I was going to get it.”
Thought she would be an English professor before the realities of the market and student debt sank in. “I had to get a job.”
Took a job at Girls Incorporated of Memphis, where she worked her way up to Development Director
Named Executive Director of The MED Foundation in 2004 and Vice President of Development in 2010
Certified Fund Raising Executive
Still reads voraciously, everything from “the silly Twilight books” to Victorian lit to Killing Pablo
Board Member, Memphis Downtown Rotary Club; Member, Association of Fundraising Professionals; and former President, Women of Achievement
Lives downtown and is a member of Greater Community Temple, Church of God in Christ