Health care — personal health care — topped the itinerary of Cerner’s new CEO Brent Shafer as he took the company’s reins Thursday.
“The first stop this morning interestingly was in one of the Cerner clinics on site, which was a very unique experience,” Shafer said. “I think it’s a great thing the company’s done.”
Like thousands of other employees, the new boss has access to at-work health care and will be picking out a primary care physician from among a group of Cerner-employed physicians.
Unlike all those other hires, Shafer, 60, becomes the first outsider to run Kansas City’s largest private employer, which has 13,700 names on its local payroll among 26,000 worldwide.
Cerner’s south Kansas City campus has set its roots with two structures so far and there are expectations that a new building will spring forth each year for a decade: room for 16,000 more Cerner associates in town.
Of course, Cerner’s roots run much deeper than the footings of its buildings.
Co-founders Neal Patterson, Paul Gorup and Cliff Illig conceived of the company — originally PGI & Associates — while sitting around a picnic table in Kansas City’s Loose Park. This was during a recession in 1979, yet they traded in their day jobs to become entrepreneurs.
Patterson took the top post and remained CEO until his death in July 2017. Besides Patterson, only co-founder Cliff Illig ever held that title, and then just during the search for a successor.
“It’s a very special situation,” Shafer said. “I’m aware coming in as an outsider carries some unique responsibilities.”
He also knows Cerner, having watched the company during his 30 years in the health care industry.
As CEO of Philips North America since 2014, Shafer led efforts to “double down” on health care and health-tech businesses while shedding the company’s traditional lighting business. He described the work in a podcast with the CEO Forum last July.
Before that, Shafer led Philips North America’s Home Healthcare Solutions group. Philips is involved in consumer health care products, population health, technology and other facets of the health care industry. A career at General Electric Medical Systems and Intermountain Healthcare added to Shafer’s experience in different settings and different cultures and from multiple perspectives of health care.
“Cerner is right in the middle of everything,” Shafer said. “It’s everything from acute care to rural care to what’s the consumer’s experience.”
Shafer also walked into the top job at a company with a tenured senior management. Finance chief Marc Naughton joined Cerner in 1992, followed by president Zane Burke and operations chief Michael Nill in 1996.
Analysts noted that some Cerner insiders had sought the job Shafer got. Shafer said he already has talked with those former rivals about their futures at the company.
“Of course, it’s human nature,” Shafer said. “I have high confidence in the leadership team. They have an excellent reputation.”
The new job means Shafer and his wife are moving to the Kansas City area. Work has taken him lots of places, including Pittsburgh in his Philips post.
Work also meant Shafer found himself in Times Square as 2014 became 2015, testing the Philips-sponsored ball drop.
“I just did that once,” he said. “I’m not sure I would willingly spend New Year’s Eve in Times Square again with a million people, but it was a heck of a good experience.”
The Shafers also have kept a “ski house” they own in his native Utah. Shafer also likes other mountain sports, including hiking and mountain biking. He said he’s prepared for life in this flatland.
“I travel,” he quipped.
Only hours on the official payroll, Shafer declined to talk about Cerner’s current business, such as the still unsigned Veterans Affairs government contract or the potential for a role in the unique health care partnership announced Wednesday by Amazon, Berkshire Hathaway and JP Morgan.
“That’s kind of the topic of the day” in the industry, Shafer said of the partnership.
He noted that the industry is changing rapidly, noting the merger plans between CVS and Aetna and adding that 2017 was the busiest year for mergers among hospitals.
Shafer said this “interesting time” in the industry means opportunity for Cerner. He specified opportunity to do business not necessarily a merger.
“All of these combinations need some form of what it is that Cerner does. So it creates opportunity,” Shafer said.
Moreover, Shafer said Cerner’s global reach appealed to him when he was approached about coming over from Philips North America, which comprises the U.S. operations of Royal Philips based in the Netherlands.
Still, Cerner’s traditional electronic health records market is maturing. Its foray into government contracts is well underway. Are there new businesses the company can pursue?
“The whole opportunity to connect health care more broadly ... is absolutely huge,” Shafer said. “Getting the (business) value from that is something that really hasn’t happened yet.”
ball drop times square 2014 tweet