A historical healthcare-industry synopsis of 35 years and tribute to our founder

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“A pessimist sees the difficulty in every opportunity, and an optimist sees the opportunity in every difficulty.”
— Winston S. Churchill

In this historical synopsis and tribute, Dennis J. Kain, FACHE, Tyler & Company President, traces the milestones that have shaped the healthcare industry these past 35 years.

Capitalizing on his personal hospital management experience, Kain shares how and why Tyler & Company has stood the test of time.

When Larry Tyler founded the company in 1978, his initial success grew from placing CFOs for several investor-owned hospital companies. Congress passed Medicare in 1966, and the impact transformed our healthcare system. Parts A and B set physicians and hospitals on a decades-long track of non-aligned payment.

With the government guaranteeing reimbursement, for-profit hospitals surfaced. Larry, with his background as a CFO and a CPA in private industry, recognized the need for financial officers who understood quarterly results reporting.

Ironically, I worked for a small, for-profit hospital company. At the time, these types of organizations bore a stigma.

In contrast, CEO search committees and senior executives in health systems welcome for-profit experience today.

If “a pessimist sees the difficulty in every opportunity, and an optimist sees the opportunity in every difficulty,1” then Larry is an optimistic realist.

That inclination, an entrepreneurial spirit and a genuine concern for others helped grow Tyler & Company from a one-man shop with a part-time assistant to the nearly three dozen team members we are today.

How so?

Congress’ efforts to continually attempt to rein in the unexpected growth in healthcare costs that started with Medi¬care’s step-down cost reports provided the firm with recruitment opportunities.

For example, the advent of diagnosis-related groups (DRGs) in the 1980s required hospital leaders to manage differently. In the 1970s, we considered ourselves great managers as two-thirds of patients paid the hospital’s costs, while the other third paid whatever a hospital charged. In hindsight, it was almost impossible not to drive a positive bottom line.

The 1980s also saw technical advances and innovation. When MRI was first introduced, I worked to raise equity to fund a series of imaging centers around the country. Specialty hospitals began emerging, and again, the firm was able to help entrepreneurs recruit a variety of leading executives.

In the early 1990s, as health reform was first seriously considered, the market focused on the importance of primary care. Tyler & Company had developed a significant physician recruitment practice to match demand as hospitals acquired and developed these services. Sure enough, as that reform movement ended, so did the physician recruitment market. It was then that Tyler & Company became exclusive in healthcare executive search.

The market experienced memorable declines such as when the Balanced Budget Act of 1997 slashed more reimbursement from hospitals than initially intended. Or, how about the economic recession of the late 2000s, which had an immediate impact on healthcare? (Compare this to earlier recessions when healthcare never lost a step.)

It appears that the realities of healthcare economics are upon us. The reform bill is being implemented at the very time basic health coverage has become too expensive. Health systems and multi-specialty physician groups now are focused on the customer experience and reducing clinical variation. This also has provided recruitment opportunities, as the competencies required for the variety of emerging positions come into focus.

Throughout the years, Larry has shared his experiences with the hope of helping others in the healthcare market.

He authored Tyler’s Guide: The Healthcare Executive’s Job Search, now in its fourth edition. For almost 30 years, his presentation at the annual American College of Healthcare Executives’ Congress on Healthcare Leadership, “Transitioning from the Military,” has been a top-rated program. Hospital and health-system boards have found the book, Practical Governance, to be a welcome reference when trying to better understand their role in governance and the process of selecting a CEO.

The opening scene in the musical, “The Music Man,” provides a short business lesson: i.e., “You gotta know the territory.” For 35 years, Tyler & Company has been led by a man who understood the changing needs of clients in a dynamic industry. This leader formed a team that successfully recruits executives to help organizations fulfill their missions.

Having worked directly with groups of board members nationwide, Larry brings an innate ability to help guide search committees when recruiting a CEO. By chairing the Tyler & Company CEO Practice, he shares his knowledge and experience so that we all may learn and grow.

As the hospital and health system CEO annual turnover rate remains in the 15- to 18-percent range, some have predicted that it could spike to 20 percent as the Boomers decide to do something else. In this light, Tyler & Company now offers succession planning services to boards of health systems and physician groups.

Throughout the years, a number of other innovations have helped differentiate the firm. One is Transcendre — a program to help freshly hired executives assimilate into their new roles. American businesses would be well served to have all new C-suite hires experience a 360-degree evaluation 60 days into their tenure.

While in graduate school, one of my professors, Aladino (Al) Gavazzi, was the CEO of the Veterans Administration Hospital in DC. He taught us that the most important person in a hospital is the patient. As the field attempts to improve the health of local communities, we could be coming closer to understanding what the patient actually wants. Have you ever met a person who wanted to spend his/her final days hooked up to machines?

American Hospital Association President, Rich Umbdenstock, said to a group of George Washington University students and alumni at the 50th celebration of its healthcare leadership program November 2012, “We have to learn how to do less with less.” That is, how to keep folks healthy while resisting the habit of providing unneeded, expensive services. This is the wave of the future.

So, after 35 years of leading a firm in an ever-changing industry by treating everyone as he would want to be treated, returning all phone calls and giving back, Larry has inspired a culture at Tyler & Company that has earned the firm a reputation of providing compassionate, thorough, retained healthcare executive search services.

The Tyler & Company team is committed to continuing this mindset for another 35 years. We appreciate your placing your trust in us.

Reach Dennis J. Kain, FACHE, President, at +1 610 558 6100 or dkain@tylerandco.com.

Winston S. Churchill

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