Richard Myers, the longtime CEO of the financially troubled Durham Regional Hospital, announced his resignation Wednesday, saying it was time for the hospital to have new leadership.
Myers led Durham Regional during the long negotiations with the Duke University Health System, which began its lease of the hospital in July 1998.
"The idea of at some point shifting leadership from the old organization to the organization that has to go forward was something that I always anticipated would occur," said Myers, adding that the decision was entirely his. "It's the right time to begin to focus on the growth and development rather than on the putting together of the partnership itself."
Whomever takes over Durham Regional will be hard-pressed to close a widening budget gap. The hospital lost $12.7 million in fiscal year 1999 and is expected to lose $15.7 million this year.
"That's troubling to all of us...," said Charles Blackmon, chair of the DCHC board. "Certainly a lot of it is beyond our control. A lot of it has to do with the rapidly changing [state] of managed care."
Myers, 57, will leave his post as CEO by the end of June and retire from the hospital altogether Nov. 1. He had been planning to retire when his contract expired in June 2001.
"Rich's retirement had been in the plans even before Durham Regional Hospital was brought into the Health System," said Mike Israel, the Health System's vice president for hospitals and clinical facilities. He added that both he and Myers agreed that the hospital needs a CEO who will be available for several years of work on improving its disappointing financial situation.
Over the next month, Israel will hold a series of discussions with Duke and Durham County Hospital Corporation officials about the new CEO. Although he said it is important for the hospital to have continuity of management, Israel declined to comment on whether he would prefer an internal candidate.
Both Health System and DCHC officials must approve the new CEO.
Israel attributed this year's losses to a series of "surprises." Health System officials are now monitoring Durham Regional's financial situation carefully, making sure the operating plan is being followed. "Hopefully, all the surprises have been cleaned up," Israel said.
Blackmon said the hospital's new CEO will be responsible for implementing a strategic plan designed to decrease the amount of unfilled beds.
But he added that making any financially successful changes is extraordinarily difficult as managed care companies and Medicare try to cut their costs. "There's this great big 20,000-pound gorilla out there called the payer that has more to do with our revenue stream than we do," Blackmon said.
Israel said although he is confident that he will be able to find a successful CEO, the task facing the new leader will be immense. "I'm frankly not sure if there's anyone-including the wizards of private industry-who can manage within our industry today," he said.
Myers joined DCHC in 1973 as an assistant administrator and became president of Durham Regional in 1986. In an interview, he recalled the great changes he has seen, including the 1976 merger of the once-segregated Lincoln and Watts hospitals and the development of a more unified community hospital.
Blackmon said Myers has been widely respected in the Durham community and within the state and national hospital communities. He's "entrenched Durham Regional Hospital as a community hospital where patient care is valued," Blackmon said. "We're sad to see him go, but we understand it."
After he leaves Durham Regional, Myers said he and his wife plan to live nearer to the water, where he will pursue an as-yet-undetermined career.
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