Hiring the Least Likely

When Michael A. Rashid joined AmeriHealth Mercy Family of Companies as executive vice president and chief operating officer 15 years ago, he grew the organization from a single-product HMO serving 500,000 in two states to a group of companies with four distinct products, including management and administrative services, in 14 states serving more than 7.4 million members.

Today, Rashid is president and CEO of the privately owned company, which had $4 billion in total revenues in 2010 and recently partnered with Independence Blue Cross and Blue Cross Blue Shield of Michigan to expand services for Medicaid beneficiaries. Rashid is implementing an ambitious five-year plan to make the company the market solution for Medicaid, which now serves roughly 60 million Americans–a number that will increase significantly as a result of the Patient Protection and Affordable Care Act signed into law in 2010 by President Obama. Rashid’s ideas for solidifying this market include cutting costs to government expenditures (Medicaid can typically be one-quarter of a given state’s budget expenditures); creating partnerships and programs with state governments, vendors, and business professionals that will improve healthcare services; and helping minorities at all levels take advantage of healthcare opportunities beyond clinical work.

Rashid, who holds a bachelor’s in marketing and an M.B.A. in finance from Harvard, has recently pledged to triple the company’s spend with minority vendors to $30 million over the next three years. These are all strategies that will also increase the company’s bottom line. The growth of the healthcare industry represents huge job and business prospects for African Americans, says Rashid, who

leads one of the nation’s largest organization of Medicaid managed care plans. “Healthcare is one of the largest businesses in America. It’s one-sixth of the economy–and this is all pre-healthcare reform.”

In his first year in his new position, he has already submitted an enthusiastically received plan to save the state of Pennsylvania $1 billion in spending, in part by increasing home- and community-based services and reducing institutional services, and he has passionately championed the Diamonds in the Rough program, which trains and hires people who have basic or few work skills, some of whom have transitioned from welfare rolls and homelessness. The program is managed by Debbie Wright, the director of talent acquisition in the human resources department, and offers job training, financial literacy, and even homebuyer assistance for its 179 full and part-time workers. In four years, the organization has hired and promoted hundreds of employees–some of whom now have bachelor’s degrees. Their ability to change behavior, Rashid says, has created more productive workers and citizens at a time when such people have been written off in the job market. Here’s how Rashid plans to accomplish his ambitious agenda.

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What kind of organizational culture supports a program such as Diamonds in the Rough?
We are working to help the underserved take better care of themselves, and we want the organization to understand that the best way to do that is to relate to people at the level they’re on. You can’t sit there and say, “I’m for the poor; I’m trying to help these people.”

You’ve got to roll up your sleeves. And the best way to deal with them and understand them is to work with them every day. And to the extent that we can bring them into our suburban culture–people who used to be on Medicaid–it helps our nurses and doctors to better relate to the people in the community as well.

What is the benefit for the AmeriHealth organization?
A huge part of our success as a culture is the fact that we are able to relate to the people we serve. Most health professionals have given up on trying to change the behavior of Medicaid recipients–just throwing up their hands and saying they don’t want to serve Medicaid recipients, or they’ll take the money for serving Medicaid recipients but not really work with them as well as they would people they can better relate to. The people we bring in help change our own employees and make them more receptive and understanding of how to take care of those people. And if our employees can do it better, they can work with the doctors and nurses in the field and help them to take care of these people better. That’s what I want to create: a better and more solid connection between the healthcare system and people who are not accessing the healthcare system now. We firmly believe that you can do good and do well at the same time. But you’ve got to work a little harder.

What does your team look for in a Diamonds in the Rough candidate?

Motivation. Drive. That’s the most important thing. Someone who doesn’t fit the regular profile, someone who doesn’t really have the experience for the job, but they are highly motivated and smart. They need mentorship, someone to put their arms around them, but they will do the job. I’m not going to say that there has been total acceptance, but the general tone of the company has been accepting. It’s hard work. We pitch the success stories and we acknowledge that we will not have 100% success. But in business, you have to take chances. We have financial literacy programs; we have life-skills programs. If they can pass through these life-skills programs, we feel like we’ve changed their behavior. Not everybody makes it through this program, but not all college graduates make it in the workforce.

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As you try to encourage other businesses to follow your model, what has been the response?
There’s a lot of skepticism, but we’re working on them and to the extent that we can expose it more to people from a business point of view, I think it will be successful. But I won’t lie to you, it’s an uphill battle, especially in this economy. So the challenge for us is to wrap it up in a value proposition. I firmly believe that if you don’t connect such a project to economic benefit, it’s not going to last and from a business perspective it’s not going to be sustainable.

You are also very passionate about getting African Americans to gain business  opportunities in the healthcare sector.

Healthcare is one of the largest businesses in America. We’re going to add 2,000 new jobs in 2012 and we’re tripling our spend with minority vendors over the next three years. [Through] health reform, 24 million new people are going to join the Medicaid rolls. That’s a 40% increase. That means there are business opportunities in healthcare. Most people, when they think of healthcare, think doctor or nurse. Healthcare is a huge business that’s way more than being a clinical professional. There are people like me, administrators. There are accountants, there are auditors. The auditing industry of healthcare is exploding [because of] the expenses on clinical services [as well as] fraud and abuse. Case management–helping doctors to manage people–is also growing. And AmeriHealth in the best position to help them out with services because we understand the community of people they’re trying to take care of. I encourage people [not to] overlook it because it’s a huge part of our economy.

Where can minority vendors find other opportunities as your organization looks to increase savings?
Misuse of the emergency room is a huge problem. It costs us money; it costs the government money. Most people go to the emergency room when they don’t need to. If someone came to us with a proposal to educate the community about how not to abuse emergency room care, we would work with them. Everybody’s looking to save money, so if you can present an idea that can save money for a company like [this one], that is a business opportunity.