2017-06-29 / Front Page

Nelson Reflects On Hospital’s Past, and Future

By Kevin R. Hess


Rod Nelson of Mackinac Straits Health System, in front of a plaque that commemorates donors who partnered to help establish the hospital at its current site. Rod Nelson of Mackinac Straits Health System, in front of a plaque that commemorates donors who partnered to help establish the hospital at its current site. Rod Nelson, chief executive officer of Mackinac Straits Health System at St. Ignace, reflected upon the past 17 years, days before his official retirement June 30.

“When I started, one of the things we had was passionate employees,” he said. “We wanted to give the community and our employees a hospital to be proud of, and I think we’ve done that.”

Since it was opened in June 2010, replacing the older hospital on Burdette Street, the new facility has grown significantly in numbers of patients and numbers of employees.

When the new facility opened, Mackinac Straits was serving 30,000 patients a year. This year, there are 65,000 registered patients, and the number is growing. The hospital’s budget when Mr. Nelson began work in 1999 was less than $10 million. Today, the budget is $40 million, with almost $14 million dedicated to payroll.

“That’s 180 people and their families working and living in the area,” said Mr. Nelson.

During Mr. Nelson’s tenure, he has emphasized the building of relationships with local, state, and federal politicians to further the local hospital, and credits the community and the hospital board for unwavering support of the efforts to provide more and better care here.

Mr. Nelson was appointed CEO September 7, 1999. He was graduated from Newberry High School and earned a degree in business from Lake Superior State University in 1983. He previously served as executive director of network development for Lenawee Health Alliance in Adrian, which merged the hospitals of Adrian, Tecumseh, Hudson, and Morenci into one network in the mid- 1990s. Mr. Nelson was the CEO of the Hudson and Morenci hospitals before the merger. His experience with this merger provided helpful experience when it came to the formation of Mackinac Straits Health System (MSHS), a joint venture among Mackinac Straits Hospital Authority, Sault Tribe Health Services, and Mackinac Island Medical Center, which is a division of the local hospital. MSHS also operates clinics at Mackinaw City, Cheboygan, and Bois Blanc Island.

“I made all my mistakes downstate,” Mr. Nelson joked, “but I knew how important this hospital was and is to the community.”

The joint venture was not an easy undertaking, especially in a rural area such as St. Ignace. Since he came here, Mr. Nelson cited seven rural towns where hospitals were closed: Cheboygan, Crystal Falls, Menominee, Northport, Norway, Onaway, Rogers City, and White Pine.

“I, and the community, owe a lot to the board and the previous CEO, Mary Tamlyn, for keeping the hospital open during a time when many others were having to shut them down,” said Mr. Nelson.

One of his first goals was to build relationships with the Sault Ste. Marie Tribe of Chippewa Indians, Mackinac Island, and legislators in Lansing and Washington, D.C. The partnership with the tribe was a key factor in the joint venture, as they donated the land and additional funding toward the project. James Haveman, Jr. was the Michigan Department of Health director who first proposed the partnership with the tribe and was a key figure in steering the project through state and federal channels. The project was one of the first of its kind. At the dedication ceremony for the opening of the new facility, Senator Debbie Stabenow said that Mackinac Straits was the first medical center in the country to be integrated with tribal health. Mr. Nelson credits Fred Paquin, Bernard Boucher, and Aaron Payment for their leadership with the tribe and their involvement with the project. Mr. Paquin served on both the hospital board and the tribal board. Mr. Boucher was a former tribal board chairman, and Mr. Payment is the current tribal board chairman.

The partnership with Mackinac Island was key, as well, said Mr. Nelson. He says Mackinac Island Mayor Margaret Doud and Dan Musser, Jr. were instrumental in helping them to reach out to the people of the Island to gain support for the project, and Clayton and the late Anna Timmons were major donors that helped make it happen.

“We were incredibly fortunate to have a broad base of support for the project,” he said. “The support throughout Mackinac County has been phenomenal.”

Initially, Mr. Nelson and the board were concerned with the challenges of funding the new facility. They knew the need was there, however, and he says they were committed to making it happen.

“It was a matter of unique timing,” said Mr. Nelson. “We tapped into the political strength of Mackinac County and Mackinac Island and were committed to remaining persistent in building and maintaining relationships with Lansing and Washington.”

The late Walter North, a former state senator from St. Ignace, was a board member during that time and was key in the endeavor. The project had the full backing of the board and gained support from Congressman Bart Stupak and Senator Stabenow.

Local people, Mr. Nelson said, recognized the importance of the project and wanted to build a great facility for the community and keep it viable. Since the opening of the new facility, the hospital has raised more than $6 million.

“We have a diverse board that is very talented,” he said. “They challenge us, but also encourage and help the administration.” He named Pat Shannon and the late Ron Mitchell as “great board chairmen.”

The project was also challenging, he said, because there were four other strong hospitals in the area, at Petoskey, Cheboygan, Newberry, and Sault Ste. Marie. The struggles of Cheboygan’s hospital, and a nursing strike in Petoskey, made the need for the local facility more clear and allowed them to recruit strong medical staff from the northern Michigan area.

They were also able to secure United States Department of Agriculture Rural Development grant funds of $37.2 million. The St. Ignace hospital was the largest funded project at the time. Although it is more common now for rural hospitals to use this resource, Mackinac Straits was one of the first to secure this type of funding.

Mr. Nelson doesn’t discount “divine intervention,” either. He said Reverend Wayne Foote, retired pastor of Glen Memorial Baptist Church, sat in his office praying for him and the hospital on more than one occasion.

The hospital has since been able to add oncology services and a surgery unit. Mackinac Straits had never had an oncology unit and it has been more than 30 years since they had a surgical unit.

Mr. Nelson noted the annual “Hooping for a Cure” fundraiser, spearheaded by Dorene Ingalls, has raised more than $134,000 over the past nine years for the oncology program.

Mr. Nelson came into his position at a time when there were a lot of unanswered questions about local health care, and says he could not have been successful on his own. He credits the support of Prentiss “Moie” Brown, Jr. and the late Dan Musser, Jr. for their support from the very beginning.

“It was encouraging to know that I had their full support,” he said.

And he has relied on discussions with other Upper Peninsula hospital CEO’s for advice, too.

Said hospital board chair Patrick Shannon: “Mackinac Straits has been very fortunate to have had very steady leadership with Rod as our CEO. During that time, Karen [Cheeseman] has also demonstrated strong leadership qualities and commitment in her roles with MSHS. While there will be challenges ahead, the board is confident that this seamless transition will continue our mission of providing local access and quality healthcare to the families and communities we serve.”

Richard Smith, longest serving member currently on the board, chaired the committee that hired Mr. Nelson.

“I had the privilege of chairing the special committee in 1999 that brought Rod to St. Ignace,” Mr. Smith said. “Over the last 17 years, the transformation of our health system has been phenomenal. The credit goes to Rod, with the help of Karen and the dedicated staff at MSHS.”

Mr. Nelson was the 2017 recipient of the American Hospital Associa- tion’s Rural Leadership Award, which recognizes an individual who has guided their hospital and community through change and displayed outstanding leadership.

Looking Forward

Mackinac Straits is in good hands with Karen Cheeseman of St. Ignace as its next CEO, Mr. Nelson says. Mrs. Cheeseman was the first executive hire that Mr. Nelson made and he believes she has the expertise in areas that the hospital will need during its next season. Mrs. Cheeseman holds degrees in human resource management from Michigan State University and a master’s degree in organizational management from Spring Arbor University.

“I haven’t met a more professional person than her,” he said. “She is methodical and very detail oriented. She is the perfect person to succeed me. My weaknesses are her strengths, and her strengths will help Mackinac Straits to continue to grow.”

The addition of the surgical unit and the construction of a pharmacy that will hold weekend hours are another positive development, said Mr. Nelson, because they are other sources of revenue.

As with every medical facility and any time there is leadership change, there will be challenges. Mr. Nelson says that any time there are changes in leadership, people will try to take advantage, whether it’s private organizations or even people within the organization.

“People might think they can just bypass the CEO now and go straight to the board members with their issues, but they will find out quickly that’s not the case,” he said.

The uncertainty of health care from the federal standpoint could also be a challenge. Republicans in Washington are working on new healthcare legislation, and the end result could lead to major changes in the laws.

“Everyone is just waiting right now,” said Mr. Nelson. “The state will have to take its lead from the federal level.”

He says one of the programs that could be in jeopardy is the Healthy Michigan Plan, which was created in 2014, helping Michigan families receive health care for a lower cost. If that program ends, more than 700 people in Mackinac County could lose their health care coverage. New legislation could also affect reimbursements through programs like Medicare and Medicaid. The local economy is a big factor, as well. Mr. Nelson says that the hospital is as dependent upon the local tourism economy of the Straits area as the businesses are.

From the medical standpoint, the affiliation with Munson Healthcare will help with areas such as Information Technology upgrades, allowing the hospital to potentially network into Munson’s system. The move to electronic medical records is a big and expensive change. Having the affiliation but remaining independently owned was important to Mr. Nelson, and he believes Mrs. Cheeseman and the board are committed to keeping it that way. Otsego Memorial Hospital in Gaylord is in talks with Munson about becoming fully integrated with them. They are currently an affiliate. If that happened, Mackinac Straits would be the only hospital in northern Michigan to be affiliated but still privately owned.

Improving billing and revenue cycle management systems will be important for the long-term health of the hospital. They could also be looking at expanding the facility. The hospital installed three trailers on the back end of the property behind Evergreen Living Center that house administration, billing, and visiting specialists. Mr. Nelson says the use of the trailers shows their commitment to the employees and patients.

“We use these trailers for administration, instead of taking away patient or employee space,” he said.

He is also proud of the fact that they have kept a good pension plan for their employees, while other facilities have reduced or eliminated them.

“I think it’s the right thing to do,” said Mr. Nelson. “They are the ones that make this work.”

The hospital will see the retirement of some of its medical staff and Mrs. Cheeseman is already working to recruit other physicians.

Mr. Nelson is not yet sure what his future will hold, and he expects to do other work eventually, but doesn’t know what that may be.

“I saw a lot of my friends unable to enjoy retirement,” he said. “I want to enjoy it. I love to be home and watch my birds. It will also give us time to see more of our kids and grandkids.”

According to Mr. Nelson, no one has been a bigger a supporter of his work than his wife, Nancy.

“She has been my biggest supporter, and she is the one that helped to keep me focused,” he said.

For now, he said, his wife, who works at Mackinac Straits, has given him plenty of household tasks to keep him busy in retirement.

“She said, ‘I want breakfast and coffee before I go to work, and don’t expect me to be happy while I go to work and you stay home,’” he joked.

Mr. and Mrs. Nelson have been married 21 years and have six grown children, Josh, Nina, Marissa, Aaron, Miranda, and Corey, and five grandchildren.

“It has been an absolute privilege to serve Mackinac Straits, and I’m thankful to the community for welcoming us and supporting us.”

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