Hoag CEO to Take Job in Seattle : Health care: Michael Stephens is credited with helping the Newport Beach hospital adapt to the changing economics of the industry.

NEWPORT BEACH —  Michael Stephens, president and chief executive officer of Hoag Memorial Hospital Presbyterian, resigned Tuesday after 19 years to run the largest nonprofit health-care organization in the Pacific Northwest.

Stephens, 52, will go to work Nov. 14 as president of Seattle-based Swedish Health Services, which includes a 697-bed regional medical center in Seattle and another, 163-bed hospital in nearby Ballard. His last day at Hoag will be Nov. 11.

“I think that, personally and professionally, I had reached the point where I would make a change or I would conclude my career at Hoag,” Stephens said. “I think it was in my best interests and the organization’s to move on to a different challenge. Certainly, there was no unhappiness here at Hoag.”

Stephens’ supporters at Hoag and in the surrounding community lamented the loss.

“I would have to say that Michael Stephens is one of the outstanding executives I’m aware of in the field of hospital administration,” said Norman Dahl, who is on the hospital board and is the chief financial officer of the hos pital foundation. “Michael is very bright and knowledgeable, but more importantly he’s a man of vision in the health care industry.”

Dahl said Stephens leaves the nonprofit 416-bed hospital in “splendid” financial condition at a time when many other hospitals are struggling to survive. He also was instrumental in establishing and building the reputation of Hoag’s so-called “centers of excellence” including the Patty and George Hoag Cancer Center and the Hoag Heart Institute, Dahl said.

“I’m sorry to see him go, but I wish him well,” Dahl said.

Others said that, under Stephens, the hospital adapted well to the changing economics of health care by opening several outpatient centers and building networks with physicians--both specialists and general practitioners--that could compete effectively for managed-care contracts.

“I feel he’s been in the forefront of the reform movement,” said Albert J. Auer, chairman of the hospital board of directors.

But Auer stressed that the hospital anticipates no change of direction with Stephens’ departure and is expected to continue with its present policies and projects. The hospital announced no plans for replacing Stephens.

Stephens’ most recently helped to create the hospital’s 20-year master plan, which could ultimately add 400,000 square feet to the hospital.

Stephens will be missed by the surrounding community, as well, Newport Beach Mayor Clarence J. Turner said.

“He was a marvelous asset to the community, at least from an outsider’s perspective,” Turner said. With his outreach and oversight, “he has built the reputation of the hospital throughout Southern California and beyond as one of the finest in the area.”

Sally Wright, a spokeswoman for Swedish Health Services, said it is Stephens’ expertise in California’s managed-care environment that attracted her organization.

She said Swedish Health Services is just beginning to form partnerships with physicians’ organizations to build what she called a “fully integrated health-care network.” The hospital-physician network would receive per capita payments from managed care organizations to care for its members.

Stephens has “been through this before” in California, she said, and so “he’s seen the future” in Washington. She said Stephens was chosen from a final slate of 15 after a five-month search.

In addition to running Swedish Health Services’ two hospitals, Stephens will be responsible for Swedish Medical Services, the arm of the organization that handles contracting and management of physician practices.

Stephens began his career at Hoag in 1975 as administrator. In 1984, he was named president and chief executive officer. Before that, he was administrator of the Greenville Hospital System in Greenville, S.C.

Stephens, who has master’s degree in hospital administration from Columbia University and in business administration from Clemson-Furman University, has 25 years’ experience in the health-care industry.