FOUNDATION HEALTH: CEO Steps Down
Dr. Malik Hasan, the embattled CEO of HMO giant Foundation Health Systems and a symbol to many of the problems with managed care, stepped down Friday, the Los Angeles Times reports. Despite Hasan's assertion that the retirement was on his own terms, "sources familiar with the situation said the company's board has grown restless with Hasan's leadership." The California medical community has not seen Hasan in a favorable light, calling him an "opportunist who became fabulously rich even as he preached the need for austerity," slashing patient care budgets to save money. He was roundly criticized in 1995 for complaining in a Times interview that his salary was insufficient. "If we are successful, then I think we deserve not only this, but more," he said. He was also disliked for his business tactics. One health care executive commented, "He was imperial in his approach. He would come in like royalty and dismiss you like you were a peon" (Olmos, 8/8). The Wall Street Journal also notes that California regulators imposed large restrictions on his management power at Health Net, Foundation's largest health plan. "With those restrictions, I haven't enjoyed running the company," he said.
Who's The Boss?
Succeeding Hasan will be Foundation's president and COO, Jay Gellert. Gellert is currently engineering a restructuring plan, which includes the possible sale of QualMed, an HMO "started 13 years ago in Colorado" by Dr. Hasan. "We're looking at nearly everything else to determine how it fits," said Gellert. He added that the most important task for Foundation is now to regain its credibility with consumers and doctors. He said, "We have to respond to the legitimate concerns about the effect of managed care on peoples' lives. Most of those issues are resolvable. The key challenge is to make this company an asset in the eyes of our customers and our members" (Rundle, 8/10).