YouSaid · the spoken record

Cleveland Clinic Executive

lines on the record: 27
first: 2021-03-02
most recent: 2021-03-02
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Therapies, as well as safety procedures for returning to the office. The clinic started a consulting practice during the COVID crisis, probably stood it up around June or July, and I made sure that all of our investment partners had the opportunity to engage with them if it was useful to their firm or any of the underlying portfolio companies that they're responsible for. So we work really hard to help the individuals within our partners. And if it's applicable, the management teams of their portfolio companies know that the returns that they generate are going to the Cleveland Clinic and what they're being used for. We find that really brings the mission of what we're trying to see and experience every day out.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“And so, therefore, we try to give them as diverse an experience as they can possibly have here. We encourage our investment partners with the business of the clinic to get engaged as well. We send out fairly regularly communications on our performance. We help them get access to subject matter experts if there's ever a question about a portfolio company that they're diligencing. We invite them to engage in the clinic's activities such as our annual gala in Las Vegas that supports our neurological research. We have an annual bike ride to cure cancer where we field a team of cyclists running at different lengths and our investment partners are invited to cycle alongside of us. And we invite them to our medical innovation summit. And this year was a little bit different because we were only able to have the gala in Las Vegas and everything else that was in person got canceled. But we invited them to webinars on various aspects of COVID such as infectious disease issues, vaccine development, and effective treatment.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So, building a team has been a really exhilarating and frankly an exhausting experience, but there's really no effort that I'll undertake that can pay more dividends than creating a culture of engagement and continuous professional development that attracts the high performing people to a team. So the focus on building the team was really on generating cognitive diversity across every position and function in the organizational chart. And we've achieved that really by recruiting people here very intentionally. So there's really two tenets to our model. Everyone has an opportunity to work across the portfolio as generalists, and everyone on the team has an equal voice and an equal vote in our decisions. So everyone, I believe, on the team is a future CIO in various stages of professional development, and I want people to stay with us for a long time, a decade or more, as low staff turnover is one of the primary keys to high-performing investment portfolios and teams.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Before I worked here, but when I found out her diagnosis and prognosis, I knew that she happened to be in close proximity to the Cleveland Clinic and I insisted that she get a second opinion here. And ultimately, she was treated here for the Cleveland Clinic. Her life was saved by a truly amazing oncology team at the clinic, and she is still walking around today thanks to their heroic actions. So in a way, I'm here today because this is a large and exciting portfolio to manage. It's a great professional challenge to envision and recruit a world-class team to build out a multi-billion dollar portfolio from scratch. And now that we've established ourselves, I kind of feel I have the opportunity to deliver investment returns that's going to fund innovation and world-class healthcare for the next generation of patients like my family member experienced.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“The investment program with the mission of the organization is simply not enough to deliver strong investment returns to the organization. Our team is part of a global healthcare enterprise and we frankly have the duty to use the insights that come from within the organization to drive our investment views and to bring those innovation and networks that reside in our portfolios to make the clinic a stronger organization. On the healthcare side, there are really two connections that drew me here. First is that experience that I had in my first venture capital fund, which I mentioned invested in healthcare. And then there's just a tremendous opportunity as I see that for innovation in healthcare. And I saw that in my early 20s with the venture fund. And I thought this would be a really interesting place to be for the next decade or two of my career. And the second really was that a member of my family who was discovered to have very advanced cancer was misdiagnosed by a physician here in Ohio. This was many years before.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“It's really been quite an interesting full circle as well. So the road to sort of my current position here at the clinic is really a combination of a couple of events throughout my life. And from a really early age, I always had a fascination with investing. And shortly after graduating from college, I found myself working in the seed stage sector of the venture capital business. And for about 15 years, I practiced there in seed and early stage as a generalist venture capitalist. And then about 15 years in, one of my limited partners called me about a new opportunity to join a large private foundation that was selling down its legacy stock in a single company to create a new global portfolio of alternative investments. So I thought that was pretty fascinating and I migrated over to the asset allocator role, which gave me a much broader set of asset classes in which to invest. But in working for mission-driven organizations for now the last 15 years, it's been a great personal challenge to connect.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Sustainable return. So I think that is one thing that will change and that will ultimately impact investment decisions. The other shift, I think, we will see is how investment teams operate. So Stephan mentioned this operating in a remote environment. But like all of us, we've had to adjust to a virtual world. So through Zoom or other platforms. And Stefan and his team and other teams, we keep hearing from our clients that they have to figure out how to communicate effectively as a team. They have to make sure they can effectively evaluate and diligence new managers and new investment opportunities and their challenges and risks that come along with that that they are managing through. But I think that will impact decisions going forward.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So, Jake, I don't see any full scale changes in how healthcare chief investment officers will invest in a post-COVID or post-vaccine world. But much like COVID has accelerated a number of trends in healthcare, telemedicine and other things like that are good examples, but it's also accelerated other trends in how investment teams evaluate investment strategies and how they operate. So one evolution that was already underway but certainly has been accelerated is specifically seeing investment teams incorporate ESG, so environmental social governance, but also diversity and inclusion factors in their diligence process. So we now have a lot more data around that, and we're seeing greater standardization across the industry around how to measure these factors. So it's led to, and I think it will continue to lead to a greater understanding around the influence of these factors on an asset manager's ability to generate”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“It relates to diversity and inclusion efforts, it's been at the center of our hiring practices and with our manager selection from the very beginning of our inception. In 2020, we conducted our second biennial diversity inclusion survey of our investment partners, and the results were very encouraging. I think that when you start with a lens that diversity, inclusion is a critical factor in your success, diversity, inclusion analysis is embedded in the due diligence process. The results will work their way into the portfolio. And this year, we added to our process by creating a statement of purpose for our diversity and inclusion work, as well as four very simple goals, all of which we can share with our investment partners so they understand the foundation of why we believe D&I and to a larger extent ESG is important and why we're holding ourselves and them accountable for those results.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So we've been involved with ESG emission investing personally myself for 15 years now and the implementation of ESG is really increasingly important to the successful returns and so is mission-based investing as a tool that institutions are increasingly using to drive aspects of their mission that can't be achieved through traditional modes. And I think that's what Paget's data really concludes. The clinic has spent the last year to review what it means to be an anchor institution in all of the various communities that we serve and that's going to result in a very different kind of engagement than we've had in the past. It's a critical component of that is really impact investing. And with ESG and not dissimilar to diversity inclusion, our investment office really has to align with what we're doing as a global enterprise, not just as a standalone investment office. We've existed for about five years now as an investment office inside the clinic, but”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“At a healthcare institution, there's going to be a lot of them. And he was right. We built that capability into the fabric of our investment office. And for the past several years, one of the key outputs has been managing the connectivity of our investment partners and portfolio companies with the key clinical leaders and researchers who are advancing healthcare at the Cleveland Clinic.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“I've always taken a holistic approach to my work, so creating intentional intersections with the innovation that emanates from the portfolio companies funded by our venture capital and private equity partners to the institution comes very naturally. To me, that's one of the primary value adds of an in-house investment organization that really can't be replicated by any other third-party relationships. And personally, I find it very gratifying when our investment partners provide technology from their portfolio companies that can be applied to the various aspects of our enterprise. especially when we might have had to otherwise try to build that ourselves and not found something as commercial as we can buy from an innovative market disruptor. One of the best pieces of advice that I received when I was first starting this job five years ago came from my good friend Jason Klein at Memorial Sloan Kettering, who I believe also probably participated in the healthcare diagnostic. But he told me to make sure that I have people on the team to handle special projects.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Years and which do not. It's critically important to successfully navigate the transition from a feed of service to bundle payments in population health. The ability to enter into shared revenue risk models where we proactively manage the health of an entire community, it really requires AI and ML tools and applying these technologies to data feeds will help us do everything from identify patients who need unplanned intervention to prevent costly and regrettable readmissions to effectively managing patients with chronic conditions and helping them to effectively navigate the electronic medical records to ensure efficiency KPI trends such as an uptake in average length of stay on a certain hospital or even a floor of a hospital or to implement robotic process automation to many of the data entry functions that our revenue cycle management colleagues have historically performed manually and they've been under sort of let's call it warp speed this past year as everyone went to work from home professionally”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So we're seeing a lot of opportunity in the application of AI and machine learning for healthcare. And that is coming from both our venture capital and our private equity partners. But it also comes from other sources around the portfolio as well. So over the last 10 years, the clinic has developed some fairly extraordinary capabilities in AI, and they were really on full display during the crisis. For example, we were able to model the spread of COVID-19 in communities as small as a few square blocks, which enabled us to prepare for the provision of care that the community was going to need as the COVID crisis spread. The ability to apply AI and ML to patients and disease is really going to be very critical for humanity going forward, but applying it to our business processes will be the difference between a system that has a positive net margin in the future and one that finds it increasingly difficult to stay independent. Both AI and ML may be one of the distinguishing factors which health systems survive in the coming years.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Super interesting, a big challenge with 10 year treasury at 1%. So as you think about the next phase of the clinic and how you're going to meet patients' needs as the vaccine becomes distributed and hopefully return to something a little bit more like normal, what areas of innovation and investment are you most focused on?”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Portfolio that supports so many different parts of this global enterprise can't simply ramp up the risk of the portfolio in order to achieve an equity-like return that it's historically earned from its long-term investments.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“The other benefit is that we have significantly more transparency and position level detail to feed into our proprietary risk system that results from SMAs. And that also helps us connect to the financials of the enterprise. Personally, I think the return assumptions have to come down from where they've been in the past decade. You really can't have treasury yields where they are, as Pageget mentioned, spreads compressed to almost extreme levels and generate the same return for the institution that expected before. So institutions with a conservative investment strategy like the Cleveland Clinic have to take on either substantially more risk to get that same return or for the intermediate period forecast lower absolute returns than they'd otherwise expect to receive from that same asset allocation. And this is a discussion that we've been having with our own executive leadership team and with our investment committee, both of whom are very engaged in our management of the portfolio and recognize that the balance sheet driven”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So, in reading the diagnostic, it felt like I was reading my own internal report. So, we're absolutely aligned with the results of the diagnostic. We're operating an investment portfolio for a service-based business that's volume-oriented and has extraordinary fixed costs and margins. They get thinner every year. We never turn away a patient. And so we also provide a lot of charity care. Liquidity became critically important this year, as you mentioned in your opening, as we saw the hospital emptied out in a very short period of time and no new patients coming in. That scenario was not in any risk model that we had attempted to look at previously. And one of the things that we've done is to pursue more separately managed accounts in our long-term pool, which is the balance sheet capital. And while all investors don't have the scale to do that, we've been advantaged in that regard and have implemented SMAs where we can so that we can minimize the impact of decisions of other investors on our ass.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“So, Stefan, that's a massive operation in global in scope. How do you think about allocating capital at this point in time? And does what Paget said about the trends that they picked up in the diagnostic ring?”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Of our clinical trial efforts at the Louvre Center for Brain Health in Las Vegas. We're opening 184-bed hospital in London next spring. And finally, we have expanded to a new cancer center and research center at our facility in Abu Dhabi. So a little bit about the investment office. We're responsible for three different pools that support the mission in very different ways. We have a long-term investment pool, which is approximately 85% of our capital, a traditional defined benefit pension plan and a captive portfolio, which is essentially a portfolio that manages the offshore proprietary insurance company assets that we have. We also have an advisory role on the oversight of the clinics-defined contribution plans, which have grown quite large over the years.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Benefit is how we sort of make healthcare available for all community residents, educate the next generation of healthcare professionals, and fund medical research. We actually spent $1.16 billion on community efforts in that fiscal year. We don't have the tally for 2020 yet, but my guess is it's going to be even higher. We invest in operating an employee-owned evergreen cooperative laundry and are using our economic resources. In this case, where it services more than 19 million pounds of laundry a year to build a stronger local economy here in Northeast Ohio. That expansion of that cooperative enterprise brought more than a hundred new employees to that organization. And finally, we're expanding access to care and advancing medical research, including a new research and innovation center that we've just opened up in Florida, where we have our second clinical hub. We have an expanded...”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Jake, thanks very much for the introduction and thanks, Paget and the entire healthcare team for your work on putting out the healthcare diagnostic every year. It's a terrific tool. So a little bit about the Cleveland Clinics mission. This year, Jake, as you mentioned, we're about to celebrate our 100th anniversary at the end of this month. We were founded in 1921 here in Cleveland as a nonprofit group practice with a mission to care for the sick and to improve patient care through research and education. We remain a community asset with no owners, investors, or stockholders, any and all of the funds from operations are invested back into the health system to fund new research and education initiatives and to continue our long-standing charitable efforts. Some examples of our mission and action and how the investment office and the investment pools support these efforts include for the fiscal year 2019, which represents our community.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“We did see continued concerns around operational pressures. And the third theme that came up was environmental, social, and governance, or ESG. And we saw a significant increase in the number of respondents who have implemented ESG in some way in their investment program. So this past year, 50% of the respondents reported implementing ESG in their program. That was up from 29% two years ago.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Sure. So, this was our third annual diagnostic, and we had 42 chief investment officers and treasurers respond to the diagnostic. And generally, there were three main themes that came out of the diagnostic. So the first, I would say on the investment front, asset allocations actually remained largely consistent with the prior year. I think some of that is a testament to the resilience of the portfolios that these investment teams have built. But they did continue to focus on alternative investments, particularly private equity and private credit. And we also saw improved sentiment around hedge funds. Second, I would say in terms of market outlook, no surprise respondents were more bearish last year than they had been in the past. So we saw a number of them cited concerns around not achieving return objectives with near zero interest rates. That's no surprise. They also cited concerns around recession, which we had not seen as much in the past.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Returns. We talked to them about how to do that in a way that didn't introduce more risk to the portfolio given all the volatility in the markets throughout the past year. And along the same lines, we also talked to clients a lot about managing liquidity to withstand short-term operational challenges.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Liquidity. Collectively, these teams manage more than a trillion in assets, and the investment income and returns generated from these investments helps support the operations of the hospital, and they might fund medical research as well. So in any given year, the returns from these investments vary, but they can be very significant. So in some years, there are multiples of the revenues generated from operations. This past year, at the start of the COVID pandemic, we saw elective surgeries grind to a halt. This is where hospitals receive most of their revenue. At the same time, many of these hospitals, depending on their location, were also facing increasing expenses. So they had personal protective equipment, PPE. They may have been ordering ventilators or providing additional staff. So these investment pools of capital are very important to these organizations in terms of maintaining the health of these organizations. We spend a lot of time this past year talking to clients about how to optimize.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT
“Sure. So let me start by just providing a little bit of context. When we say our healthcare clients, we're specifically talking about nonprofit healthcare organizations and hospital systems in the US. Of the approximately 6,000 hospitals in the US, about half of those are part of a nonprofit health system. And the top 10 systems account for about 30% of all nonprofit hospitals in the U.S. So these are big organizations that serve tens of millions of patients each year. They're also some of the largest employers, so they're actually the largest employer in 16 states. Cleveland clinics a good example of that. They're the largest employer in Ohio. And in many other states, they're at top three employers. So at these organizations, our clients are specifically the investment offices who are charged with managing long-term pools of investments, as well as pension plans, insurance pools, and oftentimes short-term.”
2021-03-02 · Goldman Sachs Exchanges · How Healthcare CIOs Are Investing Capital Through a Public Health Crisis · IDENTIFIED FROM THE TRANSCRIPT