Inside Track: New job is a turnaround for this turnaround guy
This time, Bill Manns’ new job — president of Mercy Health Saint Mary’s — does not involve a turnaround.
Maybe by now, Bill Manns’ mother is OK with the fact that he didn’t become a doctor.
Since Aug. 19, Manns has been the new president of Mercy Health Saint Mary’s in Grand Rapids, the second largest acute care hospital in the region and part of CHE Trinity Health of Livonia, the second-largest Catholic health care system in the nation.
Manns, a Detroit native with degrees from the University of Michigan, came to Saint Mary’s from the Alameda Health System in California, where he had been chief operating officer since 2005. Before Alameda, he was an executive at St. John’s Health System in Warren in several capacities, including COO and executive vice president of Providence Hospital, and before that, vice president of operations at Detroit Riverview Hospital. He also worked at Mercy Health Services in Livonia, the forerunner of Trinity Health.
His father was a quality supervisor at General Dynamics; his mother taught high school biology. He said his parents told him: “You are going to be a doctor when you grow up.”
And he thought so, too.
He graduated from high school with a 3.8 grade point average, which earned him a four-year scholarship to Michigan State University. But one day, he was on the U-M campus and saw a sign about careers in health care administration. “I had no clue what a health care administrator did. I was going to be a doctor,” he said.
Then, in late August, Manns said, “I decided to go to the University of Michigan” — much to his parents’ chagrin. There was no scholarship for him at U-M.
His grades suffered somewhat at U-M because there was “a lot of racial strife on campus” and he became involved in the issues. Manns and a friend revived a defunct NAACP chapter on campus and spent a lot of time on that — “not studying.”
During college, Manns had a summer job that provided an education of its own. It was at the Wayne County Morgue. He figured it might help him get used to what he expected to see as a med student. “I saw a lot of young men who looked just like me,” he said — a stark lesson in mortality and a reminder that many others were less fortunate than he.
One summer, Manns got a scholarship to be an intern at Henry Ford Hospital, working with a vice president involved with operational analysis. At the time, the new Prospective Payment System was beginning to put a financial strain on hospitals. Before PPS, insurance companies generally reimbursed claims to cover whatever a hospital charged, but then the insurance industry decided to limit what it would pay. With tighter budgets, Manns said he saw disparities at the hospital and realized an administrator could develop policies that would improve access to all people in the community.
In 1989, he received a bachelor’s degree in psychobiology and then went on to earn a master’s in health services administration in 1991. There followed a series of jobs at Mercy Health Systems, now CHE Trinity Health. His work was cost analysis, financial analysis and IT.
While at Mercy Health, Manns became acquainted with Sister Mary Ellen Howard, who ran a home health agency. One day in 1996, she told him to talk to a certain executive at Detroit Riverview Hospital. There was an opening and Sister Howard figured he was a good fit. Manns, however, failed to contact the executive. When Manns encountered Sister Howard again, he confessed he had not followed her instructions. She was not pleased.
“We ended the conversation with my saying, ‘Yes, ma’am. I’m polishing my résumé now.’”
This time he took her advice, which turned out to be a big break in his budding career: a job as an assistant administrator. A year later, he was promoted to associate administrator. By 2001, he was vice president of operations. He was appointed to a special team, leading a successful $13.1 million Financial Improvement Initiative — a turnaround.
Detroit Riverview, an inner-city hospital, was hurting when he got there.
“We went from losing a million a month, to breaking even, and then a slight positive,” he said, adding, “We did it in 16 weeks.”
In 2002, Manns accepted a job at St. John’s Providence Hospital in Southfield, a 459-bed tertiary care and teaching hospital with a medical staff of 1,000. He was vice president of clinical and professional services, responsible for 700 employees and day-to-day operations of the operating rooms, radiology, pharmacy, biomed, home care, orthopedics, audiology and rehab. By 2003, he was COO and executive vice president.
In 2005, Manns was named COO at Alameda Health System in inner-city Oakland, Calif. In his first month, Alameda lost $1 million; the second month, it was $1.3 million. Then Manns and his boss, the new CEO Wright L. Lassiter III, embarked on a turnaround project that eventually reduced the annual budget by $23 million. Today, the system includes three hospitals, 2,900 employees and $600 million annual revenue.
Manns said there are several key focal points in a turnaround, with contracts being a hot spot.
“If you’re an organization that’s losing money, why should some of your vendors and suppliers have double-digit positive operating margins?” he said. “We focused on contracts that were not fair to the organization — it was common sense.”
For example, he knew what it cost to have a room professionally painted in his home, so he and his team were startled to learn a comparable job at the hospital cost four times as much.
“You start to eliminate contracts that, historically, no one has really looked at.”
Products or services that are not core to the operation are another focus, he said. One of the hospitals he worked for was providing a service to an organization that was not part of his health care system, “and we were losing money on that contract.” Manns told that organization it had to pay more or put out an RFP to find out what other hospitals would charge. The organization did so, and got three bids, including one from Manns’ hospital.
“We came in number two,” said Manns. “We didn’t get the business. But again, it wasn’t core to what we were doing.”
One strategy Manns used in turnarounds was talking to the hospital employees’ unions. He explained to the unions what the team had done to cut costs. But now, he said, the issue of employee cost had to be addressed, and the unions listened.
“For me, it’s not about ‘Can we reduce jobs?’ It’s to improve the efficiency of an organization while still keeping people employed,” he said.
Still, turnarounds are very intense.
“I had circumstances where I’d get on the elevator and everyone would get off,” said Manns. But he said when he gets a chance to talk to employees, “They see that you really do care about the community, about the patients, about unemployment. They get it.”
Manns said he absolutely was not hired at Saint Mary’s to initiate a turnaround, adding that it is “doing fairly well” and not losing money. The hospital has an outstanding medical staff, he said. It is a teaching hospital for medical and nursing students and, in May, was granted a Magnet designation, the 13th Michigan hospital to receive one and one of fewer than 400 worldwide.
It’s not all work for Bill Manns. Being a Detroiter, he has a passion for cars and working on them on the weekends — a hobby he picked up from his father and uncle. He owns nine cars: His pride and joy is a 1987 Buick Grand National — “the fastest production sedan that was built in the 1980s.”
Spoken like a true Detroit motorhead.