New Jefferson leader brimming over with strategies

Stephen K. Klasko presented his vision for Jefferson to managers.
Stephen K. Klasko presented his vision for Jefferson to managers.
Posted: April 12, 2014

Stephen K. Klasko, who became chief executive of Thomas Jefferson University and its affiliated hospitals in September, doesn't mince words regarding the challenges faced by institutions like his.

"The math doesn't make sense for urban academic medical centers," Klasko said in an interview Thursday.

Medical-research funding is going down, government and private insurers are reducing reimbursements, and universities can't keep raising tuition. That's a dynamic that "has created a lot of the angst in town," Klasko said.

His answer: "We have decided to create a totally transformed model around an entrepreneurial, academic 'One Jefferson.' "

Three weeks after participating in the announcement that Jefferson Health System, which included Thomas Jefferson University Hospitals and Main Line Health, would be dissolved July 1, Klasko presented his vision for Jefferson to 800 managers at Loews Philadelphia on Thursday afternoon.

The combined operations of Thomas Jefferson University and Thomas Jefferson University Hospitals Inc., separated in 1995 when Jefferson Health System was formed, do not yet have a new name.

A new, combined website at and a new tagline - "Health is all we do" - were unveiled Thursday.

Additional matters to be dealt with include the appointment of one board of directors to replace two and the selection of a new chair for the organization, which employs 13,600.

Jefferson also needs to refinance $325 million in debt, which it will assume from Jefferson Health System on July 1.

The new Jefferson has secured a $360 million bridge loan from Bank of America to cover the repayment until new bonds can be issued, Klasko said.

The split of Jefferson and Main Line Health makes sense, said Ralph Muller, CEO of the University of Pennsylvania Health System.

"I think they are better off now being able to pursue the course they want to pursue," Muller said.

Klasko, 60, grew up in the Philadelphia region and worked here and in the Lehigh Valley until 2004, when he became dean of the University of South Florida's Morsani College of Medicine and CEO of the affiliated USF Health, both in Tampa.

In Florida, Klasko developed a reputation for making changes at a rapid-fire pace and for innovations that upset the status quo.

"He's not afraid, and this is his term, to do something disruptive," said Daniel J. Hilferty, president and CEO of Independence Blue Cross, who said he met Klasko at a dinner soon after Klasko came back to the city.

Their dinner conversation was not about the specifics of how Jefferson and IBC can work together, but along the lines of "what will the health-care system of future look like in this region?" Hilferty said.

Klasko, who speaks quickly and has a million ideas on how to make Jefferson better, is convinced that the future will be dismal if the health-care industry doesn't significantly change how it operates, with smarter technology use to improve the quality of care a top priority.

That's why Klasko is making innovation a top priority at Jefferson, one of three operating pillars.

"The only three people who are going to be reporting to me are one provost and CEO of the academic pillar, one CEO of the clinical pillar, and one CEO of the innovation pillar," he said.

That differs from most institutions, where efforts to commercialize academic inventions and work with private industry are buried levels down in the management chart.

Each of the three CEOs will be motivated to help the entire organization.

"Every one of those pillar CEOs, half their incentive will be based on how the other pillars do," Klasko said.



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