End of an era at IU Health: CEO Daniel Evans to retire

Indiana University Health head Daniel Evans announced Tuesday that he plans to retire as the leader of the state’s largest health system, which he helped expand from three hospitals in Downtown Indianapolis to nearly 20 facilities around the state.

When Evans steps down as president and chief executive officer next May, Dennis Murphy, IU Health’s executive vice president and chief operating officer, will step into that role. Murphy will become president in Evans’s stead immediately.

Since taking the top post at what was then Clarian Health Partners 13 years ago, Evans oversaw unprecedented growth during a rocky period for the health-care industry, which weathered both the Great Recession and health reform. Revenue grew during that period from about $850 million to nearly $6 billion.

“I think Dan is going to go down as legendary,” said Douglas Leonard, president of the Indiana Hospital Association, noting that Evans, who also has been a tireless advocate for patient safety, helped catapult IU Health to a place of national prominence.

IU Health continues to transform. Recently, it announced plans to replace its aging Downtown facilities with a $1 billion academic health center that will mesh better with a future health-care system that places as much emphasis on preventing disease as on treating it. There’s also a less elaborate project in the works for Bloomington.

Still, Evans said Tuesday, the time has come for him to step down, adding that he had always intended to retire in his mid to late 60s. He will be 67 next April.

“There will always be something on the horizon. If not now, when,” he said.

In the early years of Evans’ tenure, he faced the challenge of unifying the staffs from two hospitals — University and Methodist. As the hospital system started acquiring more facilities around the state, it changed its name to IU Health in 2011 in an attempt to emphasize its ties with the university and increase its national prominence.

Four years later, few would dispute the success of the IU Health brand.

And many see that that brand as synonymous with Evans.

“He’s a larger-than-life guy,” said David Johnson, president and chief executive of BioCrossroads, who has known Evans since 1987, when both were attorneys with Baker and Daniels. “He’s somebody who has always known everyone, been fearless about being involved in things and has really drawn on those relationships. I think some of the visibility of IU Health under Dan Evans is part of Dan Evans’ visibility himself.”

Replacing Evans may not prove easy, but both Johnson and Leonard said IU Health did the right thing developing a long-term transition plan. Both also praised Murphy for his health-care acumen.

Murphy will remain in the chief operating officer position until a successor if found.

“It’s really admirable to see an organization like that design a succession plan, so it will have a seamless impact on the organization ... instead of going out shopping and making a bet on a stranger to come in,” Leonard said.

Two years ago when Murphy joined IU Health from Northwestern Memorial HealthCare in Chicago, both he and Evans discussed the possibility that he might one day succeed him.

Unlike Evans who came to the job with little professional background in health care — he was an equity partner at Baker and Daniels — Murphy, 51, brings years of experience in health-care management to the job.

Murphy, who holds an undergraduate degree from the University of Notre Dame, earned a master’s degree in health-care administration from Duke University. He spent 10 years at Johns Hopkins Hospital before his time in Chicago. While in Chicago, he helped open a 328-bed, $507 million women’s hospital.

For most of his lcareer, Murphy said, he has been a clinical operations expert. This new position will allow him to tap into different skills.

“I spend my days making sure trains run on time as my primary role,” he said. “This job appropriately allows me to grow much more into a strategic leadership capacity.”

For Evans, Methodist Hospital was a part of his life from the start. He likes to tell people he was born there. His father served as the chair of the hospital’s board in the mid-’60s. As a young adult, Evans helped raise money for a new building, one that still stands on Senate Avenue.

Before he became CEO, Evans served as chairman of the board and spent three months serving as interim CEO, when he persuaded fellow board members he was the right man for the job.

Despite his previous experience, nothing prepared him for his new role, he said.

“The biggest surprise to me ... was there is nothing simple about the delivery of health care,” Evans said. “If one can’t manage the ambiguities and complexity, one shouldn’t be a health executive in the 21st century.”

Then came the Great Recession and the Affordable Care Act, as well as two ensuing Supreme Court cases, that put the whole health-care industry on edge. During his tenure, Evans helped move the hospitals and Indiana University’s many health schools, from medicine to optometry to social work, closer together. Meanwhile, he found himself overseeing an increasing number of hospitals stretched across a growing geographic area.

“Managing that stress for the past six years has been the No. 1 challenge,” Evans said.

Now, IU Health turns to the next chapter, planning for the future.

“We’re one of the biggest and bigger doesn’t necessarily mean better,” Evans said. “We’ve got to embrace the future. ... The future isn’t about hospitals. It’s about well-organized systems of care.”

But in order to achieve that, IU Health will have to transform its two adult hospitals in Downtown Indianapolis, which could wind up angering some.

“The real key is actually convincing people that we’re not closing one hospital or another, but we’re actually creating a new environment,” Murphy said. “We’re really creating a new model of care to be successful in what we know is a rapidly changing environment.”

While Murphy plans for the future, Evans said he still has not decided exactly what retirement will hold. He intends to remain active and involved in the Indianapolis community. Formerly active in Republican politics, he would not rule out a run for office but said it was not likely.

Golf will almost definitely be involved.

Saturday, Evans said, he got his first-ever hole-in-one and thought about retiring right then. But the caddy told him he had to play out 18 rounds. And so he continued to finish the game.

Call Star reporter Shari Rudavsky at (317) 444-6354. Follow her on Twitter: @srudavsky.