Genesis CEO Hager on Leadership, PDPM, and the ‘Medicaid Problem’

Genesis Healthcare (NYSE: GEN) has been working to optimize its portfolio in a year of troubles both for the company and the skilled nursing industry at large — with a goal of properly positioning for the future as changes loom large in the space.

Leading that effort is CEO George Hager Jr., who has served in that role for Kennett Square, Pa.-based operator since 2003. The company was worth $200 million when he started at Genesis in 1992; it has since grown to $5.4 billion in 2017.

Skilled Nursing News’s sister publication Senior Housing News sat down with Hager to discuss his career, his leadership style, and the benefits of scale in a skilled nursing world that’s focused on regional players.


“We’re in a very challenging time right now, with some of the reimbursement changes that occurred in 2011 and 2012, and then now, the impact of health care reform,” he told SHN as part of its regular Leadership Series interview feature. “I’m a big fan of health care reform. I’m a big fan of changing the fundamental incentives in the health care system today, having them be more focused on outcomes. But with those changes come challenges. Without strong, stable leadership, managing those challenging times would be virtually impossible.”

Hager also discussed the benefits of scale, and whether or not a national player such as Genesis can move quickly enough to react to challenges in local markets.

“I think we can do it better than the local operator because I can afford more resources. I can innovate more,” he said. “I can be involved in the bundled payment program more. I can employ physicians. I can employ much higher levels of clinical skill than they can, which now gives me the ability to participate in the Medicare Shared Savings Program through the only post-acute sponsored ACO [accountable care organization] in the country.”


But the challenges of the SNF space aren’t new, and Hager believes that the industry is at “a demographic low point,” with declines accelerated by financial distress and shrinking bed supply. Once the industry reaches equilibrium, demographically driven demand will overcome the decreasing supply, he said.

And that’s crucial because even though the new Patient-Driven Payment is on the horizon — and Hager is cautiously optimistic that it will be positive for the industry — its impact will be focused on Medicare patients, which account for just 11% of Genesis’s census.

“Today’s system is rehab-focused and oriented, as opposed to the broad needs of the patient, so at the highest level, I’m supportive and optimistic around the new system,” he said. “That doesn’t solve the Medicaid problem. The real problem in this country is long-term care.”

Read the full interview at Senior Housing News.

Written by Maggie Flynn

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