This interview with Dr. Steven Safyer, President and CEO at Montefiore Health System in New York City, was conducted by Eric Larsen, managing partner, and condensed by Juliette Mullin, senior editor.

Question: I've heard you describe your current work as the destination job, and it is. But the path to get to that chair is a fascinating one to me. As you reflect on your journey to where you are now, what are some of the defining moments, in health care and in your own career progression?

Steven Safyer: Well, when I look back now, I can see that there's a continuity to my career.

My upbringing was one that fostered a strong sense of social justice and what was right. I grew up in a town that became a target for school integration in the North after the Supreme Court's ruling in Brown vs. Board of Education. I saw Dr. Martin Luther King, Jr., when I was 10 or 11. He was in a convertible, and there was no protection. He stood up and gave a speech as he was traveling through Long Island.

I was supportive of the effort to integrate the schools and became more involved over time. It's interesting because eventually integrated schools became commonplace, but to take a stand in those times was not particularly easy.

Later I became an activist in college, and from the time I left college until I decided I would go to med school, I was pretty actively engaged in Chicago and in San Francisco. So there was a theme in my life.

At some point, I decided being a doctor would be very pure, and all the work would be for the greater good. I went to New York to complete pre-med requirements at Columbia. And when I looked around and found Albert Einstein College of Medicine, I felt at home. The academics were great, as were the clinical opportunities. It was also a place where many people resonated with my values.

Albert Einstein had been very progressive. He lent his name to the school because he did believe, in a secular way, that Jewish students should be able to go to med school. He also insisted that people who had been blacklisted or women who couldn't progress in their careers should be hired. And many of those people were my professors.

That's how I found Montefiore, where I've spent 37 years of my career. [Editor's note: Montefiore is the academic health center and University Hospital for Albert Einstein College of Medicine.]

Q: I read that you worked at Rikers Island—New York City's main prison facility—during your time in medical school.

Safyer: That's right. To pay for Einstein, I participated in the National Health Service Corps.

I went to med school and trained at the very beginning of the HIV epidemic, and I saw the first patients. I was going to do infectious disease (ID), and I had a three-year commitment to serve in the corps. So I went to Rikers. I ended up spending eight years there.

Q: And was there a moment then when you realized you wanted to lead?  

Safyer: When I went to Rikers Island, my intention was to be a physician.

It was during the era of Rockefeller drug laws, and they were locking everybody up. There was a lot of lawlessness, but there also were just a lot of poor people who were swept up into the system. So there were 24,000 people at Rikers on any one day, and 25% were HIV-positive. There were very, very high rates of drug resistant tuberculosis.

I felt that HIV and tuberculosis presented huge challenges. For me, there was no way I could leave until I put it on a different level.

What we did at Rikers was build a 150-bed tuberculosis hospital, which was the most advanced tuberculosis hospital in this country. If we hadn't advocated for the better identification and treatment of potentially infectious patients, New York City would have suffered an incredible burden of tuberculosis.

It was around then that I was starting to see how—if I took it seriously—I could be a leader, and I could make an impact.

The challenge of changing culture: A key lesson for young leaders

Q: If you could teleport back 25 years ago—to again become Steven Safyer, budding doctor and soon-to-be executive—what do you wish you knew? What's an insight or a lesson that would've been useful back then?

Safyer: I've thought about this a lot, actually. But it's easier to tell it in a story.

When I was at Rikers, some other clinicians and I started to realize that patients with HIV whom we had diagnosed with pneumonia and treated with erythromycin were not getting better. At some point, it just dawned on me: They had tuberculosis. The city lab did the test work on TB, but it would take two weeks for the specimens to get there. They always came back negative—because the specimens had dried up.

I just started treating people for tuberculosis because they weren't getting better on the other therapies. I did that even though their tests were negative. They got better, which was amazingly gratifying. But at the same time, it was pretty frightening: All these people had tuberculosis.

At the time we realized it, the city was in financial trouble. No one wanted to give the necessary resources to the jail, but not doing so seemed like a great risk to the public's health.

I realized there were two things I had to do. One was change the culture among the clinicians who were working for me, and two was fighting City Hall to get the resources.

I thought fighting City Hall would be the hard thing, and changing the culture would be easy. It seemed everybody was going to die; 25% already had HIV and tuberculosis was then going to compound the problem for the entire population. All we had to do was identify everybody who had tuberculosis, isolate them, prove it, get them on treatment, and then get them follow-up care when they left jail.

But the staff would say, "We're going to get tuberculosis if we identify them." It was very hard to overcome. I learned quickly that you stick to what you say, keep saying it, and translate it so it resonates. You have to communicate.

Meanwhile, fighting City Hall, I just had to figure out. I had to learn transactional politics and how to, in a sense, lobby.

A groundbreaking strategy for population health

Q: Montefiore has been an exemplar of strong population health for more almost two decades.

Safyer: You know, I think there is nobody exactly like us. But some have elements that are very similar to ours.

We've aspired to be like Kaiser Permanente, and I wouldn't mind having a single commercial product, but that's not realistic in the Bronx. We deal with 35 different intermediaries that handle Medicare, Medicaid, and commercial insurance. The insurance companies weren't exactly going to transfer their premium to us, unless there was some compelling reason, especially when they could keep 30% of their premium, or 40% in the old days.

The other side is that we have about 1,500 interns, residents, and fellows at any one time and 850 medical students. The clinical faculty at Albert Einstein College of Medicine are employed by us. So we have that academic side, but we're unique in the sense that we sought integrated payments, and needed to build an integrated system. Otherwise we wouldn't be able to do what they now call population health.

Q: So what are some of the key lessons you've learned in that population health space?

Safyer: We've been doing population health since 1995. The truth is: it takes a long time—longer than I think politicians want to wait. In fact, it took us five years of losing money. It probably wasn't until the early 2000s, when we were writing off the losses, that we began to have a margin in that activity.

We were compelled to manage population health because the economics of the Bronx were bad. The borough was challenged, and then the recession made it worse. We needed a sustainable model.

A lot of my colleagues now are looking to operate insurance companies. Montefiore has

an application pending before the state Department of Financial Services that would provide us with the option to offer an insurance plan if there is a need in the market. Having an insurance license gives us the ability to adapt as we address the demands of a changing health care environment and take on additional financial accountability for our patients' health.  But I don't feel the need to be one. I think they could play a role, but I want more money to stay in the health care delivery system going to patients so we can manage the care—actually put it to work.

We have a legal entity that takes the risk, and that doesn't require the same amount of reserves in the state of New York as it would if I had an actual insurance company. Also, I don't have to be marketing insurance all over. So I have all the advantages of an insurance company without those negatives.

Q: Can you explain how that works?  

Safyer: Well, it's a legal entity in the state of New York that can take risk, and it's not a physician-hospital organization because private doctors can join it. It's a transfer of risk: They find the patients, and they walk away with some profit.

I haven't needed to use the insurance license because I'm able to assemble the risk in Medicare, Medicaid, and commercial, to the point where it's almost 50% of all my revenue.

Q: Can you talk about your participation in the Pioneer ACO program? Your participating patients are older, and they are sicker, and they are more fragmented in terms of their care. And yet, you guys have figured out how to do it. How?

Safyer: The reality is that to be really successful at this, you need good public policy. The state of New York has been pretty good about this. There's been a persistent drive to move everybody into managed care. In the Bronx, the majority of Medicare recipients are in a Medicare Advantage plan, and we are responsible for 90% of those lives.

The patients who were in the Pioneer ACO were the patients whom the insurance companies didn't want to recruit to managed care. It's no mistake that 40% of them are dual eligibles, and many of them have morbidities like mental illness, and multiple chronic problems.

There were a lot of explanations for why we did well and others didn't. We saved up to 7% every year, which we got to split with the federal government. We focused on the sickest patients who hadn't been in a managed care program.

We did that because of our experience and our ability to get better and better at predictive analysis and pinpoint where we should intervene. Maybe 15% of all the lives are actively managed. You have to identify the group to target for each disease or couple of diseases that you're managing.

For example, people with end-stage congestive heart failure are going to get readmitted over and over and over again. They can't get a transplant. But people who are earlier on in congestive heart failure, you can manage them. So we got better at picking the groups.

Q: So let's say, hypothetically, you went off to lead a totally different health system. We'll say it's equivalently sized, but doesn't have 20 years of the experience you do. What are the two or three things that you would do to transform a system and accelerate that migration to value-based care and population health management?

Safyer: I don't think the Montefiore model is cookie-cutter and can be replicated as is everywhere in the world and in every part of the country. But I think it's highly applicable to parts of the U.S., where there are many places with academic medical centers that need a sustainable model in the future.

If I went to one of those places, I would only go to one where the board was behind that transformation. The Montefiore board is so supportive. I would look for a place that was receptive to the things that I would want to do because of my values.

Then it would be my job to figure out how to configure the system to move it toward success. Honestly, it would be different in different places.

An expansion plan that's not about volumes

Q: Montefiore is expanding geographically. How does that fit into the broader plan for the health system?

Safyer: There's an easy answer to that. Everybody across the country and all the big systems in New York are aggregating and acquiring. They're all doing it to create scale and everything that means.

One key difference between our expansion strategy and those of other systems is that I'm not trying to bring one patient here who can be cared for closer to home in a well-coordinated system.

We have 350,000 emergency department visits per year. We care for something like 900,000 people on some regular basis, of whom, in the Bronx, maybe 300,000 are prepaid. So I'm moving to have access to a bigger population because I don't think I will ever get 100 percent of a smaller population that I care for into the capitated model, for a variety of reasons. It's a scale issue, because for the last 100 lives I won't have to ramp up as I had for the first 100. It's just economics.

So we build on our experience, our capacity. We've prepared for it, but it's more about populations and less about more beds. In fact, in some instances, we've closed the hospital beds.

For instance, we acquired Westchester Square Hospital and transformed it into the first free-standing emergency department. There were 150 beds there, and they were admitting 5,500 people per year. They will admit maybe 2,000 to 2,200 patients per year to other facilities in our system. We're only admitting those who need to be admitted, and we're trying to bring that population into the Pioneer ACO model so we can provide comprehensive care that addresses the medical and social needs that so many in that community face. I strongly believe that these models will soon become the standard for why so many of us went into health care, to reduce waste, improve quality, and create stability in the cost of care.

Get more lessons from the C-suite

See the Daily Briefing's archive of must-read interviews with other top hospital and health system leaders, including:

Why Sutter Health partners with other providers: 'We're not a believer that we have to do it all.'

In an interview with the Daily Briefing, CEO Patrick Fry discusses Sutter Health's expansion strategy, his approach to population health management, and the doctor that inspired him into medicine./p>

Why one health system quit the ACO program—and partnered with Intel instead

In an interview with the Daily Briefing, Jim Hinton discusses his path to becoming CEO of Presbyterian Healthcare Services, the frontline challenges of health reform, and why his health system pulled out of a Medicare ACO program. Read our interview with Jim.

He was told he'd never go to college. Now he's CEO of an $8 billion health system.

In an interview with the Daily Briefing, Michael Dowling discusses his path to becoming the CEO of North Shore-Long Island Jewish Health System and the challenges with branching into the insurance business. Read our interview with Michael.

He took a job no one wanted. How Trevor Fetter brought Tenet back from a crisis, and where he thinks health care is headed.

In the early 2000s, Trevor Fetter took a job no one wanted at an embattled hospital chain; he became the CEO of Tenet Healthcare. In an interview with the Daily Briefing, Fetter explains how the system emerged from difficult times to become one of the largest hospital operators in the country. Read our interview with Trevor.

Why one CEO made a $36M bet on behavioral health

In an interview with the Daily Briefing, CEO Michael Tarwater explains how Carolinas HealthCare System grew and why it turned behavioral health into a system priority. Read our interview with Michael.

Did this hedge fund leader invest in your hospital? Here's how he decides.

Glenview Capital Management is Tenet's single largest shareholder and a major investor across the hospital industry. In an interview with the Daily Briefing, CEO Larry Robbins explains how he views the industry.

How an English major became a hospital CEO at age 29

In a Q&A with the Daily Briefing, Sandra Bruce explains what she's learned in her decades as a hospital CEO, how two systems overcome bumps in the road to become Presence Health, and what it means to "Lean In" in health care. Read our interview with Sandra.

Most staff aren't naturally great leaders, but studies show that leadership and management can be taught. Use our Leadership Competency Diagnostic to help your managers further develop their strengths and focus on opportunities for improvement.

And it's never too early to start grooming a great manager. See our Succession Management Implementation Guide to ensure you deliberately chose your future leaders—don’t let circumstances choose them for you.