Wolfe packs

What hospital critics have derisively called the “Phil and Dan Show” is breaking up.

Phil Wolfe announced Aug. 15 that he is stepping down as chief executive officer of Enloe Health System and Dan Neumeister, chief operating officer of Enloe Medical Center, is taking his place.

Wolfe, who said leading Enloe has been the best professional and personal experience of his life, said he has yet to find a new job and he and his wife will stay in Chico until he does. Wolfe, 53, was hired as CEO in 1995, and could stay on for nearly a year to help with the transition.

“It’s one of those voluntary step-downs you’re doing because it makes the most sense for the organization,” Wolfe said. “It makes us more nimble. It makes us more efficient.”

The move has been in the works since the nonprofit began the process of revising its Strategic Plan one and one-half years ago. The plan called for consolidating Enloe Health System and Enloe Medical Center. The entities’ boards will also be joined.

Mark Spelts, chair of the Enloe Health System board, said at an Aug. 16 press conferencethe change is “in the best interest of not only our employees but our patients.”

Spelts said he had no idea how much money combining the positions would save. “Any time you can eliminate bureaucracy in any organization it has bottom-line impact,” he said.

The board is still negotiating with Neumeister regarding a raise. In 2003-04, he made $339,796 a year, plus benefits and an expense account, while Wolfe brought in a base pay of $541,386. Wolfe will get no special exit package, Spelts said.

Neumeister has been called “Dan, Dan the Hatchet Man,” a reference to a series of cuts to middle management and various departments shortly after his arrival.

David Welch, a 24-year Enloe employee and chief nurse representative for the local chapter of the California Nurses Association, said the moniker was somewhat undeserved. “Part of Dan’s role when he was brought in was to be the designated ‘bad guy,” he said. “Phil wanted to keep his own hands clean.”

The “Phil and Dan show” assumes that the pair’s collective management style is to put on “a nice, smooth show for people,” Welch said. He said Neumeister has been running the hospital for years, so, “I’ll be surprised if the average hospital employee notices all that much difference in style and the way things run.”

Under Wolfe’s leadership, Enloe weathered a changing HMO scene, declining reimbursement rates from the government and private insurers and snapped up competing Chico Community Hospital, creating a monopoly. The hospital’s incoming revenue went from $112 million a year in 1995 to $270 million this year.

“It’s always nice when you can leave an organization in better shape than you found it,” Wolfe said. “I’m most proud of the fact that we’ve remained independent.” Corporations have repeatedly sought to buy out the nonprofit, Wolfe said.

He added that he will miss being able to see the hospital expansion through to its planned completion in 2008. The expansion of the 1937-era hospital has been a hot-button issue in Chico as it will forever change traffic patterns and the character of the surrounding neighborhood.

The stormiest part of Wolfe’s tenure came in 2000 when nurses sought to unionize under the California Nurses Association. The administration launched a massive, costly campaign to fight the union, but was unsuccessful. Now, Enloe leaders are challenging the efforts of other employee groups to unionize under the United Healthcare Workers West and a strike is rumored for the contracted-out housekeeping and dietary employees who work for Compass.

At Tuesday morning’s press conference, praise was heaped upon both men.

"[Wolfe and Neumeister] put the organization above themselves all day, every day,” Spelts said. In fact, he said, the pair urged the board to make the best decision for the hospital even if it cost them their jobs. The trend in recent years has been toward consolidation, Wolfe agreed. The Enloe Health System arm has a smaller role contracting with HMOs and physician groups as well as overseeing the Windchime assisted-living center, a small hospital in Seneca and Glenn Medical Center, the last of which it plans to phase out of its system. Now, Wolfe said, the focus can be on the “core” hospital on The Esplanade.

Welch, of the CNA, said, “There hasn’t been any need for Phil’s job for a long time.”

In a dàjà vu twist, Wolfe found himself out of a job 10 years ago in a situation that bore a vague similarity to the current one. In San Luis Obispo County, one hospital got bought out by another and they merged. “I recommended [one] CEO and they gave it to the other CEO,” Wolfe said, pleased, now, that the ousting landed him in Chico. “I might be dumb, fat and happy in San Luis Obispo and not realize what I missed.”

Wolfe had been mentoring Neumeister since he brought the now-50-year-old on board in 1997, something Spelts called “succession planning at its finest.”

Spelts, along with Dr. Peter Magnusson of the Enloe Medical Center board, described the process by which Neumeister was chosen to succeed Wolfe.

The hospital contracted with a Kansas City, Mo. executive recruiting and employee relations firm, Management Sciences Associates (MSA), and a board ad hoc committee did what Enloe’s press release called “an extensive interviewing process.” However, that didn’t involve specifically “headhunting” any candidates other than Neumeister, Spelts said. Instead, the process looked at the “skill set” required and confirmed that Neumeister was the man for the job.

Referring back to the Strategic Plan, Neimeister said the hospital plans to grow rather than cut, and includes among its goals recruiting physicians, enhancing the hospital’s public image and focusing on technology.

Neumeister said that, while they occasionally disagree behind the scenes, he and Wolfe share similar values and beliefs, so, “I believe the transition will be a very smooth one.”