James Reinertsen, M.D., chief executive officer of beleaguered CareGroup and its flagship hospital, 589-bed Beth Israel Deaconess Medical Center, Boston, resigned July 23 at the request of the board of directors, who said a turnaround plan wasn't going fast enough for them.
Projected losses of $50 million for the fiscal year ending Sept. 30 are less than half of last year's losses of $105 million, but more than expected (July 9, p. 12). Board members said the turnaround needed to be revved up, and they will begin a search for a new CEO immediately.
Reinertsen, 54, worked at the six-hospital system, Massachusetts' second largest, for three years, arriving from HealthSystem Minnesota, where he was president and CEO for 11 years.
In the interim, Robert Melzer, chairman of Beth Israel Deaconess, will serve as CEO, working closely with the hospital's management team. Melzer is the former president and CEO of Property Capital Trust and has been a trustee at Beth Israel since 1983.
"We thank Dr. Reinertsen for his hard work in dealing with the challenges facing our healthcare system. However, while the results for this year will be better than last year, they will not meet expectations," said John Hamill, chairman of CareGroup, in a written statement. Reinertsen was unavailable for comment.
CareGroup saw its bond rating drop to one step above junk recently and is selling more than one-fifth of its campus as part of the cost-reduction program.