For months, employees of Memorial Healthcare System have clamored for the next CEO to be promoted from within the organization, and this week the board of directors delivered on those wishes by naming the former chief operating officer, Aurelio Fernandez III, as the new top administrator of the $1.8 billion-a-year public hospital network for South Broward.
The seven-member board of directors for Memorial Healthcare, whose legal name is the South Broward Hospital District, was unanimous in its vote to appoint Fernandez to the top job — a show of confidence that Fernandez called “very important.”
“Having a unanimous vote, I think, confirms the commitment by the board to maintain the organization in the direction we have set forth,” Fernandez said. “If we had had a split decision, it would have sent mixed signals.”
Board member Laura Raybin Miller, who at times clashed with administrators during the CEO search, said her vote was based on Fernandez’s passion for the hospital system and his extensive knowledge of the competitive and complex healthcare industry.
The South Broward Hospital District levies a millage rate of $1.73 for every $10,000 of taxable property value south of Griffin Road. At that rate, the hospital system expects to generate about $8.1 million in 2016, which it will use to pay its share of Broward’s matching funds for Medicaid and to cover community redevelopment fees in several cities.
“For me, what really clinched it was the readiness,” she said. “He’s able to hit the ground running, and that’s what we need at this point in time.”
Now that he has been selected CEO, Fernandez will begin negotiations on an employment contract for his salary, benefits and other compensation and terms, which must be approved by the hospital system’s board of directors.
He has served as interim chief executive, earning a salary of $687,000 a year, since March 1, when former CEO Frank Sacco retired after a more than 40-year career with the hospital system, which took him from assistant director of housekeeping to the corner suite in the corporate office.
Sacco, who had been president and CEO since July 1987, guided Memorial Healthcare’s growth from a single hospital in Hollywood to one of the nation’s largest comprehensive healthcare networks with six hospitals, a nursing home, urgent care centers and community clinics.
Fernandez pledged Wednesday, his 64th birthday, to continue growing the mammoth healthcare system while maintaining a culture that he described as patient-centered, open and collaborative.
“You’re going to find that in order for an organization of 12,000 employees to achieve that kind of integration takes a lot of time,” he said, “and an internal candidate will always have the understanding, the embracement of the ‘whys’ — why is it that we’re doing what we’re doing.”
An internal candidate will always have the understanding.
Aurelio Fernandez III, CEO of Memorial Healthcare System
Fernandez said he intends to continue key initiatives, such as developing a shared-savings program with physicians, expanding Memorial Healthcare’s brand into new markets, and promoting some of the system’s best-known lines of service, including Joe DiMaggio Children’s Hospital, cardiac and cancer care, inpatient rehabilitation and neurosciences.
He also acknowledged that the CEO search, at times a contentious process, has left a need to mend fences between Memorial Healthcare’s board of directors, who are appointed by the governor, and the hospital system’s administrators.
Miller agreed. “My hope is that it will be a much more synergistic and collaborative relationship between the board and the administration team,” she said.
During the six-month-long search, dozens of Memorial Healthcare employees, patients and others spoke out at public hearings to express their strong desire for an internal candidate to succeed Sacco. The pressure to choose an internal candidate led at least two external candidates, from hospital systems outside Florida, to withdraw their applications.
12,000 Employees in the Memorial Healthcare System
David Bradley, a regional vice president for the nonprofit Sutter Health in Northern California, wrote to corporate recruiters in January explaining his decision.
“Given the politically charged environment; the discord among the District Board members; and, the furor that will likely result from a non-internal candidate selection, it will be very difficult for a new, external CEO to focus on the operational and strategic priorities for the Memorial system,” Bradley wrote.
“This has been a long process,” Fernandez acknowledged. But he added that repairing lines of communication, transparency and trust between the board and administrators is key to moving forward.
“To me,” he said, “that’s very important.”