A collage of complex regulatory demands is redefining how hospital and health system CEOs work with chief legal officers or general counsels. CEOs and hospital leaders are increasingly looking to general counsels as strategic partners on senior management, and hospitals are becoming more interested in developing in-house legal teams that take an aggressive approach to compliance.
Werner Boel, senior associate at Witt/Kieffer in the executive search firm's Atlanta office, says he's seen an increase in the number of searches for hospital legal executives in the past few years, a heightened demand largely prompted by the healthcare reform law and the complexity of its provisions.
"I think systems and CEOs want [to take a] much more proactive stance when it comes to strategy being in compliance," says Mr. Boel. For instance, many hospitals have established separate legal teams solely for the development of their accountable care organizations, since the model brings its own regulatory concerns and legal risks.
Here, Mr. Boel discusses five signs of the evolving relationship hospital and health system CEOs share with their legal teams.
1. CEOs want general counsels with business mindsets. Mr. Boel says the best general counsels do not act as "naysayers" on the executive team. CEOs want to work with counsels who are creative and eager to find solutions if legal hurdles arise in strategy development. Counsels are gaining visibility in the C-suite by adding value to discussions about physician integration, affiliations, compensation arrangements and an array of other strategies.
"Frustration has stemmed in the past when CEOs felt legal was there to create roadblocks, but now I think it's a much more dynamic field," says Mr. Boel. "The general counsel can say, 'I see where you are heading, but we'll need to do X, Y and Z to get there,'" says Mr. Boel.
2. Ideal general counsels are also effective managers. The general counsel's ability to provide leadership to the legal team is another characteristic sought after in in-house counsels. CEOs want legal executives who act as managers by leveraging resources among the legal team, but also act as leaders by effectively interacting with the CFO, COO, CMO and other senior level executives. "[CEOs are] not viewing the legal role as someone who needs to know all the answers, but plays a role on the team," says Mr. Boel.
3. CEOs want broad and narrow understandings. General counsels today must master two overlapping realms of healthcare law. They need a rich understanding of the Patient Protection and Affordable Care Act, and the ability to communicate its provisions to the executive team, while also possessing in-depth knowledge of their respective systems and markets.
Some top-of-mind issues for general counsels include antitrust scrutiny, physician employment, Stark Law, antikickback laws, professional licensure, hospital compliance programs, the Health Insurance Portability and Accountability Act, the Emergency Medical Treatment and Active Labor Act and a variety of other laws and regulatory pressures. In addition to these perennial issues, hospitals are also facing a heightened regulatory environment with an onslaught of audits, such as the federal Recovery Audit Contractor Program, and more involvement by the Federal Trade Commission in provider transactions. In many ways, the breadth of a general counsel's workload has never been greater.
4. An executive who also acts as an educator. Many chief legal officers or general counsels are also taking on educational roles and helping their boards understand the current regulatory field and healthcare reform law, according to Mr. Boel. Furthermore, the general counsel is not only gaining visibility in the C-suite and board room, but on a regional level well. Many legal executives are acting as representatives for their organization by meeting with legislators and elected officials to help ensure those decision-makers are informed about what the health system is experiencing.
5. Hospital legal teams are a niche market. How many eligible hospital and/or health system general counsels are out there today? Few enough to make it a competitive field, according to Mr. Boel. "It's a niche market," he says. "Health law is a fairly young practice area, and right now the pendulum is swinging toward beefing up in-house legal teams. But, candidates with track records at senior executive levels and [with experience] as in-house legal counsel is a small pool of candidates."
Traditionally, academic medical centers and integrated health systems have invested the most time and effort in developing in-house legal teams, according to Mr. Boel, but that trend is now spreading to other types of healthcare providers, as well, as indicated by the increase in legal searches at Witt/Kieffer. Furthermore, many law schools are developing their own concentrations in health law, recognizing that as an area for growth. "Law schools have also developed relationships with healthcare providers for internships for students," says Mr. Boel. "Some of those systems are hiring people right out of law school."
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Werner Boel, senior associate at Witt/Kieffer in the executive search firm's Atlanta office, says he's seen an increase in the number of searches for hospital legal executives in the past few years, a heightened demand largely prompted by the healthcare reform law and the complexity of its provisions.
"I think systems and CEOs want [to take a] much more proactive stance when it comes to strategy being in compliance," says Mr. Boel. For instance, many hospitals have established separate legal teams solely for the development of their accountable care organizations, since the model brings its own regulatory concerns and legal risks.
Here, Mr. Boel discusses five signs of the evolving relationship hospital and health system CEOs share with their legal teams.
1. CEOs want general counsels with business mindsets. Mr. Boel says the best general counsels do not act as "naysayers" on the executive team. CEOs want to work with counsels who are creative and eager to find solutions if legal hurdles arise in strategy development. Counsels are gaining visibility in the C-suite by adding value to discussions about physician integration, affiliations, compensation arrangements and an array of other strategies.
"Frustration has stemmed in the past when CEOs felt legal was there to create roadblocks, but now I think it's a much more dynamic field," says Mr. Boel. "The general counsel can say, 'I see where you are heading, but we'll need to do X, Y and Z to get there,'" says Mr. Boel.
2. Ideal general counsels are also effective managers. The general counsel's ability to provide leadership to the legal team is another characteristic sought after in in-house counsels. CEOs want legal executives who act as managers by leveraging resources among the legal team, but also act as leaders by effectively interacting with the CFO, COO, CMO and other senior level executives. "[CEOs are] not viewing the legal role as someone who needs to know all the answers, but plays a role on the team," says Mr. Boel.
3. CEOs want broad and narrow understandings. General counsels today must master two overlapping realms of healthcare law. They need a rich understanding of the Patient Protection and Affordable Care Act, and the ability to communicate its provisions to the executive team, while also possessing in-depth knowledge of their respective systems and markets.
Some top-of-mind issues for general counsels include antitrust scrutiny, physician employment, Stark Law, antikickback laws, professional licensure, hospital compliance programs, the Health Insurance Portability and Accountability Act, the Emergency Medical Treatment and Active Labor Act and a variety of other laws and regulatory pressures. In addition to these perennial issues, hospitals are also facing a heightened regulatory environment with an onslaught of audits, such as the federal Recovery Audit Contractor Program, and more involvement by the Federal Trade Commission in provider transactions. In many ways, the breadth of a general counsel's workload has never been greater.
4. An executive who also acts as an educator. Many chief legal officers or general counsels are also taking on educational roles and helping their boards understand the current regulatory field and healthcare reform law, according to Mr. Boel. Furthermore, the general counsel is not only gaining visibility in the C-suite and board room, but on a regional level well. Many legal executives are acting as representatives for their organization by meeting with legislators and elected officials to help ensure those decision-makers are informed about what the health system is experiencing.
5. Hospital legal teams are a niche market. How many eligible hospital and/or health system general counsels are out there today? Few enough to make it a competitive field, according to Mr. Boel. "It's a niche market," he says. "Health law is a fairly young practice area, and right now the pendulum is swinging toward beefing up in-house legal teams. But, candidates with track records at senior executive levels and [with experience] as in-house legal counsel is a small pool of candidates."
Traditionally, academic medical centers and integrated health systems have invested the most time and effort in developing in-house legal teams, according to Mr. Boel, but that trend is now spreading to other types of healthcare providers, as well, as indicated by the increase in legal searches at Witt/Kieffer. Furthermore, many law schools are developing their own concentrations in health law, recognizing that as an area for growth. "Law schools have also developed relationships with healthcare providers for internships for students," says Mr. Boel. "Some of those systems are hiring people right out of law school."
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