Q&A with Marc Harrison, MD, president and CEO of Intermountain Healthcare

The new president and CEO looks ahead to the Utah system becoming a referral center and says last year’s net operating margin can be chalked up to an implementation of an electronic medical record system.

Interview by Peter Wehrwein

Marc Harrison, MD, is the new president and CEO of Intermountain Healthcare, the 22-hospital integrated delivery system headquartered in Salt Lake City. Before taking the top job at Intermountain, Harrison, 52, was chief of international business development for the Cleveland Clinic and CEO of Cleveland Clinic Abu Dhabi in the United Arab Emirates. Harrison, who is board-certified in pediatric critical care, graduated from Dartmouth Medical School and did his residency at Intermountain’s Primary Children’s Hospital.

So you were in Abu Dhabi for five years. What was that like?

Abu Dhabi was a great experience. When I arrived there, we were at the relatively early stages of the Cleveland Clinic Abu Dhabi project. There were big plans, good architectural plans, and construction had begun. The human team was very small, about 35 people on the ground. It was an amazing opportunity from a massive project management standpoint, to understand how to do a cultural replication of an academic medical center in the United States. The best part, really, is always about the people, developing a leadership team and working with our local partners who were really spectacular and made it all possible.

Marc Harrison, MD

Marc Harrison, MD

Understanding how we fit into the broader medical ecosystem and cultural context—that was the really rich part of it. I loved the whole experience.

What sort of cultural friction did you run into?

No friction, actually. Just really understanding how medicine is used in that part of the world. It was an interesting exercise in listening.

It would seem like Intermountain is a whole different challenge than what you were doing in the Middle East. It’s already a paragon of health care virtue. You’re not building something from scratch.

I would say you’re 100% right, and I can’t believe this paragon of health care leadership wanted me to — don’t tell anyone I just snuck in here, OK, Peter?

I read an interview that you’re interested in building up Intermountain as a referral center. Is that something you’re focused on in the near term?

As you probably also read, my first to-dos are to try and understand the culture, the history, and to listen carefully to the operators, and understand what their realities are and what their hopes and dreams are. And what their communities are telling them. I just came out of a two-hour meeting with our regional VPs. It was a free-ranging conversation for them to share with me what it’s like to do their jobs. And I’m doing a lot of that.

You’re on a listening tour?

Yes, sir. But I will also say that I’m anxious to understand how we fit into the national and international health care ecosystem. We are completely dedicated in the communities we serve, and our mandate, when the system was formed 41 years ago, was to be a model system and to have good accessibility and to keep health care affordable. That hasn’t changed, and it won’t change. But the question of how we fit in more broadly as thought leaders and contributors and potentially as a destination, is in evolution.

Are there any particular areas where you think you might become a referral center for?

I think we’re seeing early progress in a couple areas. Our Primary Children’s Hospital is already attracting patients from as far away as Alaska for cardiovascular procedures and for oncologic care. Again, that’s based on outcomes and costs. On the adult side of things, we are also seeing patients begin to travel for cardiovascular services, for bone marrow transplant. Again, demonstrably excellent results at low cost. And in an environment where it’s an easy place for people to fly in and out of. The connectivity that Salt Lake City has is terrific.

But I would be remiss if I gave the impression that the primary goal I have for Intermountain is to become a referral destination. I think that will happen largely based on how we develop value in other ways. I think there’s a virtuous cycle of managing populations while understanding how to keep costs low and how to keep quality high.

The goal then is not to become the Cleveland Clinic of the American West?

The goal is not to become the Cleveland Clinic of the American West. The goal is to become the Intermountain Healthcare of the world. And I do not mean that in a geographic, expansionist way; I mean that in a way where we share what we’re learning, and we learn from others in terms of how we reduce variability, how we increase quality, how we work on our patients’ experience, and how we become consumer-focused.

Let’s change the subject to SelectHealth, your insurance division. My power reading for this interview led me to believe that SelectHealth has been financially troubled, partly for lack of the risk corridor payments. And I also read that the premiums of plans on the ACA exchanges went up 30%. What do you see as the future of SelectHealth, particularly its financial well-being?

I think of SelectHealth as an integral part of Intermountain Healthcare. It is an entity unto itself, from a legal standpoint, and we respect it as such. But it is an important alignment tool for us to provide realistic population health.

You are correct that the exchanges have been difficult, based on both local environment as well as national environment. I think thanks to the financial strength and excellent leadership by Dr. SorensonCharles Sorenson, MD, was Harrison’s immediate predecessor as CEO and president of Intermountain. and the management team here, despite the fact that we are owed a substantial sum of money for the risk corridors, Intermountain continues to be very strong. And there’s no imminent or even medium or long-term danger, from a financial standpoint.

Were there discussions about pulling out of the exchange?This interview was conducted before the November 8 election.

There have been conversations around pulling out of the exchanges, yet we continue to be dedicated to the patients that we serve here. If we were to pull out, about half the counties in Utah would not have an option. And where would those patients be? For the time being, for the foreseeable future, we are in. And we are going to go ahead and figure out how to make this work for the populations we serve.

I noticed that Intermountain’s revenues in excess of expenses took a hit going from about $431 million in 2014 to about $279 million in 2015. Are you concerned about that decrease? What do you plan to do to address it?

I think a good leader is always paying attention to the financials of his or her company. So, whether it’s a concern or whether it’s an awareness, I think that’s a matter of degree.

I think those financials are explicable based upon both the risk corridor payments, as well as, if you take a deep dive, you’ll see that we’re exactly in the middle of a massive electronic medical record implementation across our whole system. If one was to carve away the EMR portion of things, the margin would actually look very strong. And we were actually really thrilled when the team went to the rating agencies, and our ratings were affirmed last year at the levels they were.

I also noticed that you seem to have a big drop in investment from $130 million to about $50 million. Has that been discussed?

How did your 401(k) do last year, Peter?

OK not great.

Right. We’re facing many of the same challenges. I’m sorry, I don’t mean to be flip, but this is a macroeconomic issue that, you know, we look very carefully at how we invest our money and the performance of the people who invest our money for us. I think this is actually a global challenge right now, with sluggish investment markets.

What does one do from a funding standpoint? One thing that I’m very relieved about is that we don’t rely on [investment income], to a large extent, for our day-to-day operations. I think systems that have placed enormous reliance on their investment income to float their operational boat are probably really in relatively deep weeds. But conservative decisions have been made here that actually tear those apart.

So, I think we’re paying close attention to this, just like you are with your personal finances and I am with mine. And I think, again, that very good decisions have been made in the past and have actually set us up nicely for the future.

Let’s change focus. As you know, there’s a lot of discussion about consolidation, both on the payer and provider side of health care. How do you view the health care systems getting bigger and bigger? People who are putting these systems together tend to argue that it leads to efficiency. But I think there’s a fair amount of data that says that the improvement of outcomes may not be that great, and you end up with large systems wielding great market and pricing power. I’m just wondering how you see the situation, especially as a person who has worked for big systems.

That’s an interesting question. I’m actually probably a culture-driven leader. And as any good leader, I am interested in growth, and we need to grow for all kinds of different reasons. But I think growth needs to be put in the context of one’s overall mission, and it needs to be accretive, and it needs to be thoughtful. And I’m not here to criticize other groups’ M&A activity, but I will make an observation that it can be distracting, and it can actually be dilutive, and it may not necessarily yield the desired results. Intermountain has grown largely organically, and I think that it’s served us well from a cultural coherence and uniformity of mission standpoint. We also are quite fortunate to have a rapidly growing population and economy here. So, a lot of growth is occurring without necessarily acquisition or merger.

Do you think these mergers are bad for American health care?

I don’t think I’m in a position to make that commentary from a macroeconomics standpoint. I’m happy to talk about how I view growth in the context of Intermountain.

Intermountain, as well as the Cleveland Clinic and the Mayo Clinic, elected not to participate in the CMS ACO program. But many people believe that ACOs are the best hope for value-based care and effective population health. Did Intermountain send the wrong signal, or did Cleveland Clinic send a wrong signal, by not participating in the ACO program?

I’d have to say that decision predated me, so I can’t comment on it exactly. I will point you to the signal we are sending. Look at that cover article of Harvard Business Review that Brent James and Greg PoulsenJames is Intermountain’s chief quality officer. Poulsen is the system’s chief strategy officer. wrote about the value of a capitated model and how we believe that this wraparound approach can actually keep quality high and cost low. Government acronyms aside, I think that is the right approach to managing a population, and we’re trying to get better and better at it.

How would you describe your leadership style?

I have four things that I try to do as a CEO. One is to have a clear strategic direction. Second is to communicate relentlessly. The third is to take good care of the people I work with. And the fourth is to be ready for anything. So, by and large, I’ve got a collaborative leadership style. I think I set a clear direction and get out of people’s way.

I do have all the other tools in my toolbox, and in urgent situations, I’m comfortable with the other, more direct, commanding control style. But my sense is that wears on people, and that is not a sustainable approach to running a transformed organization.

Is there any business book that you read that’s number one on your shelf?

I’m actually not a big fan of business books, in general. I will say that I loved Endurance, the book about the Shackleton expedition to Antarctica. You know what I liked? Pretty tough circumstances; he brought everyone home alive. If there is a single leadership book that I like, it’s probably Leadership Agility. And the thing I particularly like about that is that as one evolves in their leadership, eventually you begin to have an impact on the communities you serve more and more. I think that’s meaningful to me. Finally, there’s a book called Lincoln on Leadership. It looks at how Lincoln led through a time when the Union was literally falling apart.

Your wife, Mary Carole Harrison, is a doctor?

A general pediatrician. She’s actually going through the licensure process right now, and I suspect she will practice after she is licensed.

Are you looking forward to skiing in Utah?

Yes, I am. This is a great place to play outside, and I am having a great time trail running, and hiking, and mountain biking. Salt Lake has become a phenomenal food city in the 20 years since we lived here, and we’re enjoying sitting outside on sidewalks and eating great meals, and just the vibrant, wonderful city Salt Lake has become from an urban standpoint.

The transcript of this interview has been edited for length and clarity.


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