It’s been a busy first hundred days for Dr. Paul Krakovitz, CEO of Cone Health.
The first leader chosen from outside the hospital system in more than 47-years, Krakovitz is also the first since Cone was acquired by Risant Health, a nonprofit health care provider formed by California-based Kaiser Permanente. He arrived in March, as aggressive expansion plans heightened territorial tensions with Atrium Health Wake Forest Baptist.
Last month, Atrium spent $6 million on a 27-acre property in Greensboro next to the site of one of two new emergency departments it has proposed in the city. Atrium’s continued push into the Gate City follows its long, hotly contested but ultimately successful campaign to build a $246 million hospital on Horsepen Creek Road. That facility is scheduled to open in 2029.
Just this week, Cone filed a certificate of need with the North Carolina Division of Health Service Regulation, making the argument a $320 million hospital on Cole Road in southeast Forsyth County is in the public interest. The move builds on Cone’s existing two urgent care centers in Winston-Salem. The system has operated Cone Health MedCenter Kernersville in Forsyth since 2008.
Last month, Cone announced a partnership with the town of Mooresville in Iredell County to open a clinic for town employees, the system’s first push into the greater Charlotte area.
Last year, the state also approved Cone’s proposal to build the first hospital in Mebane, the small but rapidly growing city in Alamance County where Cone already operates Cone Health MedCenter Mebane. Cone beat out a similar, joint Duke Health/Novant Health plan for a Mebane site.
Krakovitz’s previous experience may make him ideally suited for just this sort of growth and struggle. A pediatric otolaryngologist who spent more than a decade at the Cleveland Clinic, Krakovitz came to Cone from Cressey & Company, an investment firm focused on innovation in health care. Before that, he was Desert Region president of Salt Lake City, Utah-based Intermountain Health. He helped expand the system to include three acute hospitals, 130 care sites, 1,000 physicians and advanced practice providers, and 8,500 other caregivers across a multitude of disciplines.
We recently caught up with Krakovitz, who has been so busy since arriving in Greensboro that he rarely takes the time to actually use his own office at Cone’s administrative building off of E. Wendover Avenue.
This conversation has been edited for length and clarity.
You’re arriving at a very interesting time. Cone Health has been a part of all of our lives in Greensboro for generations, but I think most of us thought of the sort of intense competition we’re seeing right now as something that happened in bigger markets like the Triangle or Charlotte.
It is an interesting time. Healthcare competition, if you want to call it that, is happening all around the country. And yes, certainly, it usually starts in bigger cities, and as time progresses, it moves down to other parts. But really, when I think about competition, I think about us in healthcare competing to become better at delivering healthcare.
It’s not about us fighting over patients.
Regardless of what the competition is, we should be getting better every day.
Cone was looking for a larger partner for some time, something it knew it needed in the current environment. For a while, it seemed like a season of The Bachelor with various suitors and everyone trying to agree on the perfect relationship. With the Risant acquisition, Cone maintained its board. And people long associated with the system tell me they believe it will retain its culture and commitment to the community. How do you think the deal changes things for the system and for Greensboro?
It’s a great question. A truly community hospital is so embedded within the community. There aren’t a lot of those. But Cone Health happens to be one of those. What happens within the culture of the city is mirrored within the hospital. To me, that’s a really awesome opportunity. Cone Health has been around for a long time in this community, over 70 years. Because of that, we’ve grown up together. Being embedded in the culture is just going to be part of that.
Does Risant coming in change that culture? Well, what is so great about the structure of Risant is [that] what Risant is trying to do is prove out that a local community hospital system can stay and maintain and be strong, but also bring in the national tools that come from a bigger organization and give you those economies of scale. For us, that’s what value-based care is about.
Value-based care means we have the highest possible quality, but at the same time, we’re able to bend the cost curve on what it’s costing in healthcare [through the efficiencies made possible by a larger system]. That’s what value-based care is really about. And Risant brings those tools that a regular community hospital system could never afford. But at the same time, they understand the magic of a community health system. So they want to bring those tools to make that happen and prove that value-based care can grow across the country. That’s really what attracted me here. It’s this beautiful intersection of community and being able to provide care, to be able to keep up and maintain it.
One question I heard this week from people who knew I was interviewing you was, will all this competition lead to Greensboro getting a Level 1 trauma center. From your perspective, is that likely, or is that a prestige thing as much as it is about the actual needs of a city?
It’s a great question. The reality is, the question is, ‘Are you getting the care that you need in your community?’
We have what’s called a Level 2 trauma center. Level 1’s the highest level, and to get to Level 1 requires academic work behind it. There are certain rules and regulations around it. I would say that the care that we deliver on our Level 2 is the care that’s needed within our community. We do an absolutely fantastic job of keeping patients here. We’ve been doing this and growing with our community for over 70 years. And in those rare cases that someone needs a higher level of care, then we make sure that they get to that correct level of care. That’s the way, in my mind, it should work for a community system. So I think we’re in a really great place.
We’ve certainly seen, in the last few years, a move toward Cone opening community clinics in parts of Greensboro and beyond where those things hadn’t previously existed. That’s a strategy that speaks to that central question of being sure you have the type of care you need where you need it.
Yes. What’s important is that we’re able to give care to everybody who needs it, not just in Greensboro but the entire Piedmont Triad and beyond. You do see a lot more of our outpatients and ambulatory centers all around various counties. Because that’s exactly what we’re trying to accomplish—the more we’re able to get care to people where they need to see it, the more we’re able to prevent them from needing to come into a hospital.
So this is another way for us to help bend the cost curve in healthcare. As you’re seeing, that care is much less costly and often the right care that you really need. And then we’re also doing things to try and be much more creative. We did a partnership with North Carolina A&T with The Resurgent. That’s really us working to get more into East Greensboro and to meet patients where they need to be met towards those [health care deserts]. We also have our mobile units that we use in cardiovascular, women’s health, and primary care—again, trying to get out to the communities where we can best serve people so they can get the care that they deserve.
Talk to me about expanding into Mebane and Alamance County. That’s something I don’t think many people saw on the horizon just a few years ago, but here we are with that part of North Carolina really expanding dramatically.
We’re still going through the process with the courts, but yeah, we’re really excited to be able to bring a whole other level of care to Mebane. We think that our model is a great model, and that it’s going to really benefit the people in the area.
With all of the economic development going on from the Toyota battery plant to all the aviation growth out at Piedmont Triad International Airport, some areas that had been smaller and sleepy towns are going to see a lot of growth and an influx of people. I know from talking to people who are in corporate site selection that a big part of the economic development picture is finding places that offer for a workforce all the things they’re looking for, and proximity to good health care is always a part of that equation.
We’re really fortunate in the state of North Carolina that we have so much growth, and there’s been a lot of policy decisions that have driven that. That’s really incredible.
And when you have new businesses coming, and more houses are being built, more people are being employed, you’re bringing in more people from the outside, they need services. And healthcare is definitely one of them.
What does a business really want? They want to be able to be confident that they’re going to be able to be successful, and that they can control as many of those kinds of outside forces as possible. Healthcare is a huge one. Affordable homes for their employees is another one. A nice community for their employees. Education is usually a really big one. That’s also where we have a big leg up over some of the other places that I’ve worked, where we’ve watched businesses really struggle on the healthcare front, or on education, or any one of those other pieces.
What we really see in the future of healthcare is being a part of that virtuous cycle of growth for a city. Now, it’s one thing for us to be able to provide care, which we absolutely, positively want to do. But healthcare is really expensive. And again, if we’re not working on bending that cost curve, then it becomes prohibitive for new growth. We want to bend that cost curve so we can encourage more business development, which becomes this virtuous cycle.
