St. Luke's new leader is prepared for complex healthcare challenge

St. Luke's new President and CEO Kevin Nokels addresses his staff Thursday.

Kevin Nokels has courted one of the biggest challenges faced by today’s healthcare executives: Leading a smaller independent hospital and clinic system. But that’s not his only challenge. The new president and CEO of St. Luke’s began his new job at a time when there’s great uncertainty about how healthcare providers will be reimbursed for the services they provide. Almost every candidate for U.S. president has a different plan for how medical services should be funded.

“The challenge that we have in such a volatile and uncertain payment environment is how to plan ahead – how to act on these things when it’s so much in flux. How will healthcare be paid for? I think everyone understands we’ll get paid, but we’ll get paid less,” he said following a Thursday welcome gathering at St. Luke’s.

Nokels was selected for a variety of factors, said Board Chair Jeff Borling. 

“He understands that the patient is what matters most – the patient above all else,” Borling said, reciting the system’s motto. But there were a variety of other factors, many of them tied to St. Luke’s expansion plans. “Kevin brings the right skills and expertise needed at this pivotal time in St. Luke’s history. He’s a team builder. He has a powerful track record of empowering his teams to lead effectively through times of change. He’s implemented successful physician engagement strategies that have allowed management decisions to benefit from the expertise and insights of the medical staff. And he’s led capital investment projects which, judging from the crane outside, is relative to St. Luke’s at this point in time.”

Nokels has 30 years of healthcare experience, most recently as president of Creighton University Medical Center in Omaha. He has visited Duluth many times during vacations.

“Healthcare as we know today is not the same as it was five years ago – heck, not even one year ago. We all know healthcare is too expensive. We know there are opportunities for healthcare to improve and become more consistent…to be even more safe than we are,” he said. 

His immediate plan is to meet with medical staff and residents. From preliminary observations, he has already drawn a couple of conclusions.

“I believe we need partnerships – to look at things very differently. It’s going to take a large community effort, not a solo journey by St. Luke’s,” Nokels noted. “Times have changed. The expectations from healthcare providers are very different.”

With funding stagnant or possibly on decline, he stressed “How we are paid will drive much of what we can do.” And for that reason, “It’s important to become more efficient.”

To remain independent, St. Luke’s must maintain a strong financial position, Nokels said. The system also must ensure its technology is up to date at a time when costs of new equipment are very high.

“In the past, the more you did, the more you got paid. It’s very complex and volatile right now. We don’t know whether there will be a national health plan or a system of private insurers. There’s one thing we can be certain of: We will be expected to provide more and get paid less, because you can’t afford healthcare, I can’t afford healthcare, our businesses can’t afford healthcare. It’s going to take a collective to figure it out,” he said.