Chuck Beaman, CEO of Palmetto Health

MidlandsBiz:
Describe a key event in your formative years that helped develop your skills as a manager?

Chuck Beaman:
After completing an undergraduate degree in political science here at USC, I received a job at Baptist as a unit manager, but when I showed up for work the first day, there were actually no current openings for unit managers.  So my first job at Baptist was as an admitting clerk helping to fill out the paper work.  My supervisor told me straight up that if I ever wanted to become a manager, I needed to know what it’s like to be a non-manager.  She worked me morning, noon and night, the AM shift, the PM shift, I thought she was trying to kill me, but looking back, it was the best start anyone could ever have in this business. 

MidlandsBiz:
Describe your leadership style?  What leaders have inspired you?

Chuck Beaman:
I try to surround myself with competent people who have integrity, and I try to hire people who are smarter than me.  I like the whole concept of servant leadership and I try to read as many books on the topic as I can.

Locally, I have always admired Andrew Sorensen and John Lumpkin and their efforts to improve the community.  Emmett Johnson, my personal mentor, was the best I have ever known at integrating values and principles with decision making.  

Jim Konduras, Johnny Folsom, Jim Reynolds, Dick Lincoln – pastor of Shandon Baptist, all of these are great local leaders.

MidlandsBiz:
Talk a little about the 1998 merger between Baptist and Richland Memorial that created Palmetto Health?  Why did the two hospitals merge? 

Chuck Beaman:
Prior to 1998, Kester Freeman, who was the CEO of Richland Memorial, and I, the CEO of Palmetto Baptist, tried to see whether we could join our two organizations.  We accomplished that goal and became operational as Palmetto Health in 1998.  We now have three main hospitals: Richland, Baptist Columbia, and Baptist Easley.  In 2006, we also opened the Heart Hospital, South Carolina’s only freestanding hospital devoted solely to heart care and we are planning to add Palmetto Health Baptist Parkridge in the northwest quadrant of the city.

You’ve got to understand Baptist and Richland were fierce competitors, but what made this possible was our shared values.  Richland was governmental public, and Baptist was private and faith-based, but what was important to both of us was the ability to take care of our local people and a strong desire for our health system to determine its own destiny. 

Back when we merged, a lot of for-profits were entering in the market and taking over hospitals.  We believed very strongly in the non-profit status of health care and felt that this merger would strengthen our position. That was our main motivation.

Secondly, we knew that by coming together we could reduce costs, particularly by eliminating duplicate services.  We made specific commitments about how much we were going to reduce in the first five years of operations. 

Thirdly, it was an opportunity for us to be locally owned and controlled and responsive to our local citizens.

Lastly, we were confident that the business model would result in better care, help to reduce the cost of care, provide a safer environment for patients, and help to deliver a comprehensive patient care delivery system for our citizens.

MidlandsBiz:
Skip ahead almost 10 years, has it been a good decision?

Chuck Beaman:
It’s been an excellent decision.  We have been able to control our own destiny by having individuals who live and work in our communities serve in local leadership roles at the local governing level.  We have been able to incorporate best-practices across our system and improve the quality of care.  We were able to document a reduction in the costs by improving our buying power.

From an employee perspective, we are the 4th largest employer in the state and we pride ourselves on the opportunities for advancement within our organization.

It doesn’t matter who insures our citizens or what their economic status is – we are here to serve.  I can’t imagine what our hospitals would be like today if hadn’t merged and aligned our services; I would do it again in a heart beat.

MidlandsBiz:
Mergers are risky.  Do you have any advice for businesses going through the process?

Chuck Beaman:
We studied the reasons why most mergers fail: lack of a solid business plan and the clash of egos, in particular, the egos of the two CEOs. 

The Board, in its infinite wisdom, recognized that Kester and I had never worked together before and that we would be entering into uncharted territories.  They took us both aside and made it clear that they would never fire just one of us.  That cooperation between the CEOs enabled us to implement our business plan.

The execution and decision making models were different at the two hospitals, but again, the common values engrained in the two institutions – service, compassion, excellence – really made this possible.

In any merger, you have to recognize the different cultures of the two entities involved. The cultural transformation that takes place within the new organization is a journey that is a product of your common beliefs, your vision and of consistent decision making.

MidlandsBiz:
What role can hospitals play in helping put South Carolina on the map in terms of competing in the knowledge based economy? 

Chuck Beaman:
We are positioned in a region that has a major research university right here in our midst.  We have a partnership with Health Sciences South Carolina, a powerful collaboration between MUSC, USC and Clemson, Palmetto Health and two other major teaching hospitals, Greenville and Spartanburg, that is designed to help identify projects that will improve the quality of life and the economic development here in South Carolina and then to provide funds through the Endowed Chairs programs as well as through grants.

We also work in partnership with the USC School of Medicine to facilitate graduates entering our system as highly trained physicians. 

But there is a broader challenge for all of us.  Not everyone needs an MD, Masters degree or PHD to work in a hospital.  We need to develop a qualified workforce to meet the demands of the patients.

In South Carolina, we do not produce enough nurses to meet the demands of the hospitals and we therefore have to go outside the state to attract nurses.

MidlandsBiz:
Is there a nursing shortage?

Chuck Beaman:
There is not only a nursing shortage, and but also a shortage of Master’s and PHD prepared educators to teach nursing at the university and technical college level. 

But it’s not just nursing.  Pharmacists, respiratory therapists, ultra sound technologists, biomedical engineers will also be in high demand over the next 15 years and are in short supply right now.  Individuals who are well trained are in demand because that’s what the patient requires. 

As the baby boomers continue to age and move through our system, the demand for health care is going to continue to rise and clinicians to take care of them are going to be in short supply unless we do something about it.

MidlandsBiz:
Does the hospital have a mission or vision in place? 

Chuck Beaman:
To be remembered by each patient as providing the care and compassion that we want for our families and ourselves.  We try to live that vision every day.

Everything that we do – systems, quality improvement, finances