If Timothy McCormick was a schoolboy, he would be the one with his homework neatly done and handed in while the rest of the class still was sweating the assignment.
As CEO of Unity Health System, McCormick, 54, heads the smallest, but arguably the least harried, of Rochester’s three major health care organizations.
Tall, balding and often blunt, McCormick says “size to me is not always an advantage.”
Unity oversees far fewer acute-care beds than its two local counterparts, ViaHealth and Strong Partners Health Systems Inc. It employs 3,960, runs three major nursing homes, a major commercial diagnostic laboratory and several senior-housing projects, each commanding respectable shares of their markets, he adds.
In contrast to Unity’s fewer than 300 acute-care, psychiatric and physical-medicine beds between Park Ridge and the former St. Mary’s facility, ViaHealth and Strong each control more than 1,000 beds.
More to the point, in McCormick’s view, is that these institutions and enterprises, which appear only distantly related, have been welded into a single system that currently is comfortably in the black.
After finishing 1999 more than $60 million in the red, Unity was in the black during the second quarter of 2000. The system will finish the year with a $1 million surplus, and projects black ink for the foreseeable future, McCormick says.
Part of Unity’s 1999 loss-more than double the previous losses-traces to a one-time charge associated with various restructuring costs incurred in a two-year effort to consolidate the Park Ridge and St. Mary’s operations.
Consolidations are standard in today’s health care landscape, Rochester Health Commission CEO Albert Charbonneau says.
“Not many have been as successful as Unity,” he says.
Health systems locally and nationally face the same basic dilemma, says Charbonneau says.
Such consolidated systems are a relatively new phenomenon. A rough analog to private-industry consolidations, they largely consist of formerly independent hospitals merged into multiple institution groups. Most, like Unity, also include a variety of non-hospital, health-related facilities.
The chief driver of the consolidation wave has been a need to achieve economies of scale as medical costs rise steeply, and the government and third-party payers that fund most U.S. health care increasingly pressure providers to do more for less. This has made the balance between quality of care and bottom-line imperatives a delicate question for all providers.
Many systems are still feeling their way through a maze of issues.
“Unity appears to have succeeded,” Charbonneau says.
Concurring is Michael Morley, director of human resources and senior vice president at Eastman Kodak Co. Both he and Charbonneau have served alongside McCormick on the Rochester Health Forum.
Morley sees Unity in some respects farther along the integration curve than Strong and ViaHealth, and gives much of the credit to McCormick.
Though McCormick had to guide the system through a potential minefield, he aggressively did what had to be done, and did it without making the cure worse than the disease, Morley says.
Unity was created some three years ago with the merger of Park Ridge Hospital in Greece and St. Mary’s Hospital in Rochester. McCormick previously had headed the newer, smaller Park Ridge. Within a year of the merger, he spearheaded a plan to end acute care at St. Mary’s.
Shutting down acute-care services at an inner-city facility while retaining a suburban one could have generated considerable protest, Morley says. But while there were pointed questions, Unity arguably had put itself in better financial shape, and left the inner-city community in better shape.
The conversion of St. Mary’s acute-care beds to long-term ones came against a backdrop of consistent evaluations of this area’s bed count as substantially too high. In the peculiar logic of health economics, oversupply does not translate to lower prices, but to the opposite.
In addition to generating unsupportable operating costs for Unity, the St. Mary’s beds could be viewed as a communitywide liability, helping to drive up overall medical costs. Additionally, moving acute-care functions to the newer Park Ridge made sense.
Still, the perception that the system was abandoning low-income constituents could have been hard to avoid. One measure of the plan’s success is it has generated virtually no controversy.
A key aspect of McCormick’s design for the switch was the conversion of St. Mary’s emergency room to an outpatient clinical-care facility. As in most low-income neighborhoods, a high percentage of nearby residents used the hospital’s emergency room as a virtual doctor’s office. They dropped in unannounced for treatment of a variety of chronic, acute, minor and major ills, many not strictly emergencies.
Since emergency care does not lend itself to efficient or cost-effective management, such habits have long been decried by experts as a significant driver of higher medical costs.
So Unity did not merely yank something away from the inner-city neighborhood, but substituted an arguably more useful commodity.
Unity took care to see that Park Ridge staff did not take precedence over former St. Mary’s personnel in merging the acute-care organizations, McCormick says. This extended to non-medical staff as well as doctors.
Also, people from the inner-city facility’s Bulls Head neighborhood, who worked at St. Mary’s, were offered positions at Park Ridge and provided transportation to the suburban hospital.
Rather than abandoning St. Mary’s, Unity has moved some operations to the city and started new ones, renting some 70,000 square feet to house them in a plaza that sits across Genesee Street from the hospital.
Such inspired, meticulously planned solutions are typical of McCormick, says Sandra Parker, Industrial Management Council president.
McCormick, who has served on the IMC board for the past three years and as a “health care mentor” to Parker, habitually looks beneath the surface and takes a long view, she says.
“I go to him for advice often because I can always trust him to give me a thoughtful perspective, one that does not just take the point of view of what might be good for Unity, or even just that of a hospital CEO, ” Parker says.
McCormick’s comments and analyses tend to come from unexpected places, says Susan Stewart, an attorney with Nixon, Peabody LLP. She first met McCormick in the 1980s while doing work for the old Rochester Hospital Consortium, and has remained a friend.
“Tim sees aspects of situations others do not,” she says. “He takes a more expanded view, and he has no qualms about telling you what he’s thinking, even if it is somewhat irreverent.”
McCormick has a sharp sense of humor and little inclination to sugarcoat even the most acerbic remark, Stewart says.
“But he does it so that people appreciate his comments rather than take offense. It’s an art,” she says.
McCormick mostly comes off as a deep thinker, Stewart says. If his views often diverge from conventional wisdom, it is because he has thought long and hard.
Charbonneau, a former hospital CEO who has known McCormick for some two decades, sees McCormick’s perspective as rooted in history. This is true both in the sense of McCormick’s knowing and taking local history into account and his taking a historian-like view. He tends to look at situations from many different angles, and to study carefully before making a move, Charbonneau says.
McCormick confesses to doing a fair amount of reading of history in his free hours. He recently plowed through works on the Persian Gulf War and D-Day, as well as few Robert Ludlum novels.
A sense of history, developed through his long tenure in the local health care industry, gives him a rare perspective, Charbonneau says.
“Tim has been in this community and essentially at the same job for 25 years,” he adds. “This is unusual in today’s climate. More often, hospital administrators are in a job three to five years.”
Were it not for the opportunity to grow the Park Ridge system, McCormick says his desire for professional advancement might have tempted him to look elsewhere. At the same time, a devoted family man and father of five, he praises Rochester as an excellent community in which to raise a family.
An avid golfer with a 20 handicap, McCormick enjoys vacationing at a summer place on Owasco Lake.
The New Jersey native majored in American history as an undergraduate at Seton Hall University in South Orange, N.J., and earned a B.A. in 1967. He originally planned a career as an academician.
Midway through a master’s program at Seton Hall, McCormick, at the time seeing academic opportunities as limited, decided to veer onto a different career path. He carefully studied various options, interviewing bankers, insurance executives and others in various fields.
His wife, Joan, a nurse and, at the time, his fiancee, had much to do with sparking his interest in health care. By the time he completed a master’s program in hospital administration at Virginia Commonwealth University in 1971, the couple was married and the first of their five children on the way.
McCormick’s first job in health care was working for the People to People Foundation, which ran the Hospital Ship Hope. The ship, now mothballed, was used to transport medical personnel and supplies on mercy missions to disadvantaged areas.
In 1973, McCormick landed a job as administrator of Park Ridge Nursing Home, newly built on a 150-acre campus in Greece. Two years later, Park Ridge Hospital was built there.
McCormick’s experiences and travails in growing the Park Ridge Health Care System Inc. probably had a lot to do with the alacrity with which he pulled Unity together, Charbonneau says.
In his more than quarter-century with the organization, McCormick has faced system-integration issues that other systems are just now beginning to grapple with, he says.
Park Ridge’s precursor was the Park Avenue Hospital, a tiny, aging institution surrounded by larger, more modern establishments such as Strong Memorial and the Genesee hospitals. Those institutions’ survival seemed a far surer bet until the Park Avenue Hospital’s board decided to move it to Greece.
McCormick was named Park Ridge Hospital’s assistant administrator in 1975. He moved up to vice president of operations in 1978, became its president a year later and became the system’s CEO in 1981.
When it merged with St. Mary’s, the system had grown to include a chemical-dependency clinic and psychiatric facilities, as well as the laboratory, senior citizen housing and skilled-nursing facilities.
McCormick is loath to take sole credit for the system’s success, attributing much of its design, as well as the decision to move to Greece, to a farsighted board, he says. Still, he takes pride in his own part in the efforts.
“We didn’t try to stamp out world hunger,” he says. “But we did what we said we would do.”
One thing that was not part of the Park Ridge plan-for which McCormick may now be grateful-was affiliation with Strong through the University of Rochester School of Medicine and Dentistry teaching program.
Though each takes pains to downplay it, ViaHealth and Strong recently have been at serious odds over an unresolved dispute over medical resident assignments. They nearly severed relations because of the situation.
More recently, Strong wooed a key physicians group, known for its interest in teaching, from ViaHealth’s the Genesee Hospital to its own teaching hospital.
McCormick has endeavored to stay neutral. But Kodak’s Morley notes that as a major player in the local health care community, McCormick cannot completely dodge these issues.
McCormick carefully avoids making statements favorable to either side. He laments the increasingly competitive environment and the topsy-turvy medical economic conditions fueling such tensions.
In particular, he finds the recent controversies most lamentable in a community where, when he first arrived, its hospitals acted in concert for the greater good. By the time Park Ridge and St. Mary’s merged in 1997, the ground rules had changed.
“Everybody was facing their own consolidation issues. I knew I couldn’t count on cooperation,” McCormick says.
He sees other administrators facing the same imperative he faced with St. Mary’s: converting acute-care facilities to other uses. This means individual institutions will have to let themselves be scaled back or altered for the community good, he says. But that cannot be achieved if systems are intent on one-upping each other in a competitive dead heat.
In a recent conversation regarding an upcoming roundtable on the area’s health systems, McCormick displayed his keen sense of irony.
“You get all those people together in one room and all you’ll get is one bland statement after another,” he predicted.
Then, after a dramatic pause, he deadpans, “And I shall be the blandest of the bland.”