Spotlight On: David Herman, CEO, Essentia Health
July 2024 — Essentia Health sees itself as an agent of change for a broken health system. “With the aging population in America, with the level of illness and obesity changing in America, now it’s the few taking care of the many, and the few paying for the many. We’re going to need to take a step back from this and recognize that it’s broken,” David Herman, CEO of Essentia Health, told Invest:
What are some notable achievements in the last one to two years for Essentia Health?
The most prominent achievement is that we finished building the replacement St. Mary’s Medical Center in Duluth. It’s over 900,000 square feet, with a $900 million investment. We finished on time, and under budget. In July 2023, we took 231 patients from the Legacy St. Mary’s Medical Center and moved them to the new St. Mary’s Medical Center within about six hours.
Any time you move into a new facility, there are some growing pains and process changes, but I would say that we navigated those very successfully. Our staff did a great job. The demand for services has increased, partially due to that move, and things are going well.
What are the main factors that have driven growth and expansion over the last few years?
There have been several changes in healthcare. First of all, while other organizations, particularly in our market, have had difficulty recruiting and retaining staff, we’ve been successful with that. We’ve built some innovative models to retain our staff. Retaining staff is much more fruitful than continuing to expand your recruiting function.
We’ve done some very simple things just to keep in better touch with our staff and to find and address those little things that I would call the pebbles in your shoes that make your job difficult to do every day. Once we understand what those are, then as leaders of the organization, we need to remove those pebbles, and we do our best to do so.
I would also say that we’ve made a commitment and have developed the processes to recognize our staff more for the great work that they do. We have built what we call the Great Vibes platform, where a manager or anybody in the organization can recognize one of their colleagues.
We had almost 100,000 of those recognitions, colleague to colleague, manager to colleague, over the first 12 months of implementing that platform. That has helped connect our organization in ways that it likely wasn’t connected before.
How is Essentia leveraging technology to improve healthcare delivery and patient experience?
We are leveraging technology in several different ways. We know that in every organization, whether you’re in healthcare or the hospitality business, the labor is just not out there as it was before. We’re leveraging technologies that allow people to use their phones to accomplish the check-in process for a visit with a clinician rather than having to come into the clinic. They can also use a check-in kiosk in the lobby. That doesn’t reduce the number of people we have working here; rather, it allows us to use those people to do things that only humans can do. We use technology to facilitate the things that technology can do.
Home monitoring is another area where technology is important. It allows our patients to understand where they are in their chronic illness and allows us to intervene more quickly and more effectively.
We are looking for all kinds of different ways to truly leverage these new technologies to allow the great people who work here at Essentia Health do the personal things, those things around personal connection with our patients and their families. If we can do something in your home or at the clinic in an easier way, we’re always looking for those opportunities.
In what ways does Essentia Health invest in the professional development and well-being of its employees?
I’ll start with nursing. There’s a thing called the nursing magnet status, which regards nursing as a profession and as a growing and developing profession. We’ve been implementing Magnet processes to achieve Magnet status, and we are now in the 4th year of that journey. The Magnet process supports the professionalism and professional development of our nursing colleagues to support their care and their careers, as well as enhance their wellness.
It’s a journey that we’ve been on for several years, and we’ll complete the certification journey within the next 18 to 24 months.
We truly believe that career development should be a goal of every organization, and when you are employed by Essentia Health, it should not just be a job. It should be a career. We provide the same time and attention to the people who are working in environmental services and food services as we do with the professionals in our organization.
We take that very seriously. This new facility was built as a healing facility, and no matter where you are in the facility, you are connected to the outdoors. Whether you are in a patient room, walking down the hallway, or in our kitchen preparing meals for our patients and our visitors, there are big glass windows, and you’re connected to the outdoors. We have a rooftop garden that allows our staff to go out and spend time outdoors during a break to reconnect with the outdoors as well.
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What is your vision for Essentia Health over the next five to 10 years?
The healthcare model has been broken for a long period. When you talk about sustainability, it’s not just environmental sustainability at this point, but how does healthcare do a better job of keeping its facilities open and maintaining the care that’s so important to each community that we’re privileged to serve?
In 2023, healthcare expenditures in America crossed a landmark where more than 50% of the money that goes into healthcare now goes to the people who manage healthcare outside of healthcare rather than the people who take care of patients. We need to be mindful of that, and we need to make a shift.
The healthcare system in America was built so that the many would take care of the few, and the many would pay for the few. With the aging population in America, with the level of illness and obesity changing in America, now it’s the few taking care of the many and the few paying for the many. We’re going to need to take a step back from this and recognize that the system is broken and needs to undergo significant change if healthcare is to be sustainable and equitable. All of us who play within this system need to commit to changing it and then work together more collaboratively to make that change.
I truly believe that Essentia Health has been a leader in this regard. We have also been a leader in engaging with the people who insure our patients. We ask how we can better work together to get better outcomes for our patients, to make healthcare more affordable, and to make sure we’re designing the system from the beginning to the end with the patient at the center of that system.
That will be a tremendous challenge. It’s not something that we’re going to solve in a quarter of a year. It’s probably going to be a continuous journey. However, unless some healthcare organizations are willing to step forward and start that journey, that journey will never start. It’s a challenge, but an exciting challenge.
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