In Defense of Paul Levy

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Paul Levy, the blogging CEO of Boston’s Beth Israel Deaconess Medical Center, found himself in hot water last

month over an inappropriate relationship with a female subordinate. While some of the details of the transgression remain sketchy, I think I now know enough to opine on it. To my mind, Paul has been an extraordinary healthcare leader, and – while the episode represents a lapse in judgment that deserves censure – he should not lose his job.

Let’s start with some background. Paul took the helm of BIDMC 8 years ago. At the time, the hospital – which operates in the shadow of its more storied Harvard cousins, Brigham and Mass General – was in crisis: its staff was dispirited, it was losing a million dollar a week, and it was still reeling from the challenges of blending the cultures of its two recently merged progenitor hospitals, Beth Israel and Deaconess. (Hint: the religious mismatch was only the start of the tsuris.)

Paul was an unusual choice for the position of CEO. BIDMC CEOs have historically been physician-leaders, whereas Paul’s major prior roles had been to teach Environmental Policy at MIT and to lead the Massachusetts Water Resources Board, where he spearheaded the cleanup of Boston Harbor. Some folks wondered whether he was up to the task of being CEO.

But soon after he began, jaws began to drop and many skeptics became fans – this was clearly not your father’s hospital CEO. An extraordinarily hands-on manager, Paul literally gushed with pride over the accomplishments of his physicians, trainees, and nurses; even the housekeepers and transporters. He embraced transparency with bottomless zeal, reporting all of BIDMC’s quality and safety data (good or bad), and challenging fellow hospital CEOs to do the same. He launched a blog, “Running a Hospital,” which became a widely read window into his thinking and management style. Within a few years of assuming his role, Levy had become arguably the best known and most highly respected hospital CEO in the nation.

Sure, it was great theater, but the important thing was that it worked. Last year, I had the honor of being visiting professor at BIDMC, and was struck by the organization’s wonderful people and by their passion for the joint. In the past decade, BIDMC has become a model of innovation, transparency, and collegiality, winning several awards and serving as the subject of a number of case studies regarding hospital quality. When I asked people at BIDMC for their best explanation for the remarkable turnaround, most of them gave the same answer: “Paul Levy.”

There are many examples of Paul’s leadership style and impact, but my favorite happened occurred in 2009, when the economic meltdown pulverized BIDMC’s finances (on top of the usual reasons, some of BIDMC’s key donors had major Madoff issues). Rather than mindlessly triggering scores of demoralizing layoffs, Paul called the entire staff to a meeting in the hospital’s Sherman Auditorium. Kevin Cullen of the Boston Globe described the extraordinary scene:

[Paul Levy] looked out into a sea of people and recognized faces: technicians, secretaries, administrators, therapists, nurses, the people who are the heart and soul of any hospital. People who knew that Beth Israel had hired about a quarter of its 8,000 staff over the last six years and that the chances that they could all keep their jobs and benefits in an economy in freefall ranged between slim and none.

“I want to run an idea by you that I think is important, and I’d like to get your reaction to it,” Levy began. “I’d like to do what we can to protect the lower-wage earners – the transporters, the housekeepers, the food service people. A lot of these people work really hard, and I don’t want to put an additional burden on them.

“Now, if we protect these workers, it means the rest of us will have to make a bigger sacrifice,” he continued. “It means that others will have to give up more of their salary or benefits.”

He had barely gotten the words out of his mouth when Sherman Auditorium erupted in applause. Thunderous, heartfelt, sustained applause.

Paul Levy stood there and felt the sheer power of it all rush over him, like a wave. His eyes welled and his throat tightened so much that he didn’t think he could go on.

That, folks, is what I call leadership.

So let’s get to the problem. Last month, the BIDMC board announced that Paul had demonstrated “lapses of judgment in a personal relationship,” leading it to express its disappointment along with its “unanimous continued confidence” in Levy’s leadership. (Well, not exactly unanimous: one board member resigned.) The board also announced that it was fining Levy $50,000, would be considering the matter in setting his salary next year, and had asked state attorney general Martha Coakley (of How’d-You-Lose-Ted-Kennedy’s-Senate-Seat-To-A-Guy-Driving-A-Pickup-Truck? fame) to investigate. Neither the board nor Levy said more, leading to predictable cries of hypocrisy – after all, here was a CEO who branded himself as being all about transparency, invoking “no comment” – and some calls for his resignation.

I’ve wanted to comment on the Levy situation for weeks, but it was difficult to do so without knowing more about the specifics of the “lapse.” Although we still don’t know everything, last week (after obtaining the BIDMC board’s permission) Paul opened up to the media, giving interviews to two Boston newspapers and one TV station.

Apparently, the story is that soon after he became CEO, Paul gave a job to a “very close friend,” a woman who began an administrative position at BIDMC’s main campus and was later transferred to the hospital’s suburban Needham site. Paul, who is married, has declined to specify the precise nature
of the friendship, it’s clear that it is substantial, and that the woman
spent considerable time with the CEO at work.
This was a poorly kept secret for years, and several colleagues urged him to sever the relationship or end the woman’s BIDMC employment. Finally, earlier this year, she did leave her job at BIDMC, accompanied by a severance package.

Clearly, the optics on this aren’t good and the episode demonstrates a lapse in judgment – both in hiring the woman and in failing, for years, to listen to colleagues who asked him to end the relationship or let her go. On the other hand, there is no evidence that the woman was unqualified for her role or was paid above market rates (her yearly salary was about $100,000), that the relationship compromised Levy’s performance, or that Levy profited in any way from it.

While the situation calls for criticism, it also begs for perspective. Paul Levy has transformed the quality, safety, and efficiency of patient care at BIDMC, a $1.2 billion organization that cares for hundreds of thousands of patients each year. Moreover, his openness has inspired other healthcare leaders to be more courageous in their approach to safety and quality. In the process of making some hard decisions in a very public job, Paul has amassed some enemies – particularly local unions like the SEIU – who are likely behind more than a few of the vitriolic comments about him that have recently appeared on various Boston-based message boards. That, of course, is their right.

As for me, I’m hoping that the BIDMC board, which showed great courage in hiring Paul Levy and allowing him to make safety, quality, and transparency into signature issues, will show similar courage by retaining him as their leader. He deserves it.

More importantly, so do the hospital’s patients.

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