CFO of the Year: John Geppi [The Knoxville News-Sentinel, Tenn.]

Nov. 05--John Geppi came to Knoxville a dozen years ago to work for Covenant Health just after its CEO's controversial departure and with the organization's insurance operation draining its coffers.

Today, Geppi is part of a senior leadership team that's not only righted the ship, but spent more that $900 million on facilities and technology to serve East Tennesseans' health care needs.

"We are blessed to be able to invest in bringing high quality health care to East Tennessee," says Geppi, who quite often during an interview deflects praise to Covenant Health CEO Tony Spezia and other members of Covenant's leadership team, his own staff and all Covenant's 10,000 employees.

If Geppi was wavering in coming to Knoxville he was persuaded by Wayne Heatherly, then the president and chief administrative officer of Fort Sanders Parkwest; Larry Martin, the banker and former deputy to Mayor Bill Haslam who was then chairman of Covenant Health's board of directors; Ed Pershing, president of health care consulting and accounting firm Pershing Yoakley & Associates; and Tom Fisher, CFO of University of Tennessee Medical Center.

"They assured it me it would be a good opportunity," says Geppi, who was CFO at Memorial Health System in Chattanooga at the time.

Pershing, a nationally known consultant who had been retained by Covenant as an adviser, acknowledges the move was a leap of faith for Geppi.

"But one of the key things about John he is always willing to undertake a challenge," Pershing says. "He is not one to sit back and rest on his laurels."

The challenges at Covenant were, not to overstate the case, big ones: Create an efficient health care system by combining what was then a "loose confederation" of hospitals by eliminating duplication and streamlining back-office functions; make the insurance subsidiary profitable; and convince the bond market that Covenant Health was a good financial risk.

For conquering those challenges and more, Geppi has been named CFO of the Year among Knoxville-area nonprofit organizations and government agencies.

Creating a system

Shortly after Geppi arrived, Covenant tapped Spezia, who had begun to turn around its insurance division, Cariten/PHP, and had successfully led its psychiatric hospital, Peninsula, as its new CEO.

Geppi and Spezia had launched their careers in similar fashion -- with Big 8 accounting and consulting firm Arthur Andersen & Co. Geppi worked in the firm's Baltimore office after graduation from Gettysburg College in Pennsylvania. He later would transfer to Atlanta, where he also worked as a consultant for Affiliated Healthcare Systems and as CFO of Northside Hospital.

The two executives accomplished the mission at Cariten/PHP, and ultimately sold the division to Humana in 2008 for $245 million -- in cash.

And they created a health system from the five hospitals that were owned by Covenant, but which had never been integrated into a cohesive entity.

With Medicare and private insurance reimbursements dwindling, Spezia's mission was to reduce operating costs to have more to spend on buildings and equipment that improved patient care, and Geppi was the point-person to implement that strategy.

Geppi acknowledges push-back as the leadership team sought to streamline back-office operations at insitutions in which there were "cultural differences and community differences," he says.

Still, they forged ahead and today Covenant Health has essentially created a campus at Centerpoint Business Park where its financial services, information technology, supply chain management, information technology, medical bill and transcription services, and other functions are located.

Pershing says the consolidation has been effective because Geppi educated staff about why the moves were needed versus imperiously pushing down the decisions.

"The system has embraced his leadership," Pershing says. "He's really educated all aspects of the organization as to the need to do that in this challenging environment. It's really a transition that's been embraced."

Geppi also has a well-earned reputation for integrity that he put to work on Wall Street, leading four successful bond issues to finance $750 million in debt. Fitch gives Covenant's finances an A; Standard and Poor's, an A-.

That has given Covenant the resources to improve health care services in the 16 East Tennessee counties it serves, including building three replacement hospitals -- in Loudon, Sevier and Roane counties -- and significantly expanding and renovating three others -- Fort Sanders Regional, Parkwest and Methodist Medical Center in Oak Ridge.

National reputation

Margins are thin in the hospital business and the forecasts call for them to only get thinner.

That's one of the reasons Geppi hasn't been satisfied to just look internally for means to reduce overhead. He helped create and now serves as CEO of Central Atlantic Health Network LLC, a collaboration of five VHA Inc. health systems seeking to leverage their purchasing power.

According to Covenant spokesman Max Shell, the collaborative serves as a model within VHA Inc., a network of not-for-profit health care organizations.

Geppi estimates the two-year-old organization has already saved Covenant about $1 million.

Those are dollars that Geppi notes are plowed back into East Tennessee.

And that's not an abstract notion, as Geppi -- through his community service work -- is all too familiar with the needs of those who are uninsured.

He serves on the board of Knoxville Area Project Access, which coordinates care for uninsured patients among Knoxville physicians and hospitals, and the Knox County Indigent Care Board. He also served nine years on the board of Catholic Charities of East Tennessee.

In those roles and others, he often interacts with his peers in a hotly competitive marketplace for hospitals.

"We will fight like crazy for marketshare, but when it comes to other matters, particularly best practices surrounding patient care, once you know it you have to share it," he says.

Pershing says Geppi has won the confidence of his board of directors, which is composed of community and business leaders, as well as those who report to him.

"John is just a great people person," Pershing says. "Talk to the people who report to him or his peers and they will say he is always attuned to people and their needs. He is a very responsible leader of his people."

His accomplishments have also been noticed nationally.

He appears on the "110 Hospital & Health System CFOs to Know" compiled by Becker's Hospital Review, a publication that focuses on business and legal issues for health system leadership.

Becker's says financial officers who earn a spot on the prestigious ranking "help lead renowned health care institutions in all financial matters while balancing quality patient care."

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(c)2012 the Knoxville News-Sentinel (Knoxville, Tenn.)

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