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Centennial stories: Change at the top brings expansion

Published 04/15/2019
(l-r) Ralph Misto, Donald Ford and Lou Giancola

When Donald L. Ford retired as president of South County Hospital in 1986, the board hired Donald J. Mazzarelli from Waterville Osteopathic Hospital in Maine.

Mazzarelli “had a honeymoon for about a year and then things started to happen,” said former board member Rudi Hempe.

The new administrator had a tough act to follow, although Ford took pains to stay out of Mazzarelli's way, who once even yelled at a reporter who called him for a comment after his retirement.

Mazzarelli was beset by a number of issues, many of which were beyond his control. Among those were lower Medicaid rates and higher malpractice insurance rates for obstetricians. The hospital, under the new president’s direction, responded by opening a women's clinic at Salt Pond Shopping Center in Narragansett and subsidizing new doctors' malpractice premiums.

During Mazzarelli's tenure, the hospital built a $4 million surgical pavilion, added 12 doctors to the staff and opened an Express Care service in the Emergency Department.

Still, it was not enough and the board decided to make a change in leadership, which they did in August 1989.

Misto takes the reins

With the departure of Mazzarelli, the Board of Trustees wanted a leader who could restore the confidence of both the hospital staff and the community. They chose longtime hospital administrator Ralph L. Misto Jr.

Ralph Misto

Hired by Ford to run the laboratory in 1966, Misto had risen through the ranks, becoming the hospital's first personnel director in 1975 and eventually vice president for management services and chief operating officer. He had actually just taken early retirement when the board called on him to serve as acting president. He was 55 years old.

With his human resource background and understanding of the hospital's values, Misto “bandaged some wounds,” said LeeAnn Quinn, the hospital's director of infection prevention and control.

In an interview with Providence Business News in 1992, Misto described the hospital as flexible enough to react quickly to change, but small enough to maintain its bottom line. During his tenure, a new maternity ward was opened with all-in-one labor/delivery/recovery rooms, a new pediatrics unit was built and the R.I. Renal Institute opened a new dialysis facility on hospital property.

The old problems of finances and patient census had not gone away, but his leadership gave staff and community some reassurance that the small hospital would continue to grow and thrive. The hospital was running slim profit margins - $28,000 a year on a $45 million budget – and coping with what Misto called the “very high peaks and lows” of admissions.

But the Joint Commission on Accreditation of Healthcare Organizations gave the hospital a 94 percent score in 1993, ranking it with the top five percent of hospitals nationally. The hospital's challenges were far from over, but it could not be accused of stagnating any longer.

Growth continues

Misto retired in 1996, and the Board of Trustees hired Patrick Muldoon of North Adams, Mass., to replace him. Once again, the hospital was in expansion mode, with plans to build a medical office building to provide office space for doctors. South County Hospital also signed a memorandum of understanding with Westerly Hospital and VNS Home Care to combine their visiting nurse services into one organization.

When the JCAHO issued its next accreditation report, the hospital had slipped a little, to an 88 percent ranking.

“We entered the survey process knowing that this experience was going to be very different from that of 1993,” Muldoon wrote to staff. “We were looking at a number of new standards and also many changes in how the standards were looked at and scored.” Still, he took heart at one surveyor's comment: “South County Hospital does many exceptional things exceptionally well.”

Muldoon, according to retired nurse Maureen Daly Blazejewski, was “socially smooth,” a “people person” whom many genuinely liked.

“Patrick came in on a bad time,” Quinn said. “And there were a lot of things to mend. And it just takes time to build a trust, but you have to keep going with things.”

Muldoon departed the hospital in September 2000, four years after his arrival, and went on to a successful career in Massachusetts hospitals, retiring in 2017 as CEO of UMass Memorial Medical Center in Worcester.

Stepping into the breach would be Louis R. Giancola. His career had included positions as chief operating officer for Lahey Health and Women & Infants Hospital.

“I don't know what the particulars were, but [Muldoon] and the staff and the providers had a falling out, I think is the best way to put it, and the organization really went into a tailspin,” Giancola said. “And they tried to salvage it, and the leader; ... they finally decided it wasn't doable.”

Giancola would face as many challenges, if not more than, his predecessors.

A philosophy of growth

“In some ways I was very fortunate because, number one, the place was at a low point when I came here November 6 of 2000, and number two, it was very clear that we had to repair those relationships,” Giancola said. “We had to work diligently; we had to not just listen but we had to act. And we had to build a team.”

Lou Giancola

None of this would be easy. Besides rebuilding staff morale and filling key positions, Giancola still had those perennial problems to deal with: revenues and patient census.

By 2003, South County Hospital ranked as the second least profitable hospital in the state. Giancola cut the full-time equivalent positions from 630 to 600. Still, the hospital's profit margin continued to swing wildly. In fiscal year 2005, it posted a $1.9 million profit. A year later, the hospital was $2.5 million in the red. The losses mounted: in FY 2006, it was $2.5 million again. A year later, the operating loss was a stunning $6.3 million.

Although the deficit was on a larger scale than in the past, the culprits were familiar: bad debt (hospital bills that patients don't pay), an increase in the health insurance rates for employees, costs for recruiting specialists, interest on debt, and rising liability insurance premiums.

While the problems were daunting, the guidance of new Chief Financial Officer Thomas Breen and others proved critical as the hospital negotiated lower interest rates to better position itself in both the short and long term. This enabled Giancola to initiate a growth strategy.

In 2007, South County Hospital opened the Frost Family Pavilion, a 60-bed, state-of-the-art, three-story addition that replaced outdated beds in other areas of the hospital. All of its rooms are private and commodious, with pullout couches, flat-screen TVs and full private baths. Like a university spiffing up dorms to attract freshmen, Giancola was banking on private rooms as the future of health care.

Earlier that year, the hospital dedicated its new Orthopedics Center. The same baby boomers who had swelled the hospital's maternity ward in the 1940s and '50s were now ready for knee and hip replacements. Investment in cutting-edge technology like robotic-assisted Mako technology, which allows patients to go home the day after surgery, would deliver South County Hospital one-third of the state's orthopedic clientele. This investment in robotic technology for surgery continued most recently with the addition of the ExcelciusGPS system for spine surgery -- another first in the state-- and the da Vinci Xi Surgical System for urologic and general surgery.

The growth strategy was a successful one as the hospital has recorded a profit for the past 10 years.

Giancola is also the type of CEO who tries hard to get to know the institution's 1,400 employees, writing articles about them for the monthly newsletter and signing birthday cards for them each month.

Ask just about anyone on the hospital staff or in the community about Giancola, and you will hear admiration for his work, and regret that he is leaving.

“I think he did an excellent job as CEO,” said N.S. Damle, M.D. “He was a visionary, collegial and forthcoming with the medical staff.”

“Lou is a very caring individual that I can't say enough good things about,” said Stephen A. Alfred, South Kingstown’s former town manager, in particular citing Giancola’s work to bring together the schools, the hospital, and local agencies to solve community health needs.

On April 1, Giancola handed the reins to Aaron Robinson, former CEO of Community Hospitals in Florida, who was selected by the Board of Trustees after a nationwide search.

“Clearly, I love the place,” Giancola said, weeks before leaving the hospital he has called home for more than 18 years. “So I think it's going to be hard to walk out the door.”

Next: The doctors of South County Health