Nashville is home to 400 healthcare businesses, giving Vanderbilt University’s Owen Graduate School of Management an edge in the placement of healthcare MBAs. Wikimedia
Healthcare in the United States is big business, so it should come as no surprise that there’s no shortage of U.S. business schools with quality programs for those seeking a job in healthcare. But of all the great U.S. healthcare MBA programs, not many offer “hands-on” learning that immerses students in the real world of healthcare delivery — and only one is located in the heart of the U.S. healthcare capital: Nashville, Tennessee.
Vanderbilt University’s Owen Graduate School of Management offers both the location and the immersion, and something else, too: a chance to live in one of the most vibrant, fastest-growing cities in the U.S. — the No. 11 “Best Place To Live” in the country, according to the latest ranking by U.S. News & World Report.
Nashville is Music City, of course, but in the last decade it has become something more: a place where, in equal measure, families and young people flock to live. The city has a population of nearly 700,000, and local lore has it that 100 people move there every day, drawn by the area’s relatively cheap cost of living (about half what it costs to live in the San Francisco Bay Area), its thriving economy, low crime, great food, Southern hospitality — and especially its status as a cultural mecca.
But we were talking about healthcare. If your interest is in finding work in that sector, you can’t do much better than plugging into the epicenter of the industry, connecting with a network that includes 500 healthcare companies based in the greater Nashville area. (Zoom out and expand your search to Middle Tennessee and that number balloons to 800.) In the city alone there are 20 publicly traded healthcare companies. Globally, Nashville-based health companies create half a million jobs and $84 billion in revenue. One out of every six hospital beds in the U.S. is in a Nashville hospital.
16% OF CLASS OF 2018 WENT INTO HEALTHCARE; AVERAGE SALARY $110K
Vanderbilt Owen Dean M. Eric Johnson
Over the past decade, about 17% of Owen graduates have accepted full-time offers in the healthcare industry directly after school; Owen’s most recent employment report showed that 16% went into the industry, with an average salary of $110,190. This jives with Vanderbilt Owen Dean Eric Johnson’s estimate that roughly 20% of each cohort — including the current one — studies for a job in healthcare.
“That doesn’t mean they’re necessarily working for a hospital,” Johnson tells Poets&Quants. “Very few of them are actually in hospitals, but more and more are ending up in providers. What’s interesting, of course, is that those providers — like HCA and so forth — have really matured in their own business practices, so their demand for MBA-level talent is growing.
“Historically that wasn’t true. Twenty years ago they hired very few MBAs, and many times if an MBA went there they likely weren’t gonna get paid an MBA-level salary, particularly starting straight out of school. Today that’s not true — and if you look at the executive ranks of a lot of those companies, they are becoming much more MBA-centric.”
A HEAD START IN THE HEALTHCARE INDUSTRY
Class of 2018 MBAa graduates by industry; 16% went into healthcare. Source: Vanderbilt Owen
MBA jobs in healthcare come in all shapes and sizes. While they are mainly set in traditional business functions like consulting, finance, management, HR, marketing, and operations, they tend to be spread across three main categories: care delivery, consulting, and corporate. Care delivery is hospitals, outpatient care, home and long-term care, diagnostic labs; consultants can work for a range of employers, from startups specializing in healthcare clients to large firms that handle healthcare projects. And on the corporate side, MBAs have traditionally found work at payers and outsourcing/distribution businesses, but in recent years pharmaceutical, biotech, and healthcare tech companies have risen to the fore.
All of this is in Vanderbilt Owen’s wheelhouse. As Class of 2015 MBA Jameson Norton says, the only real constant in healthcare is change, and while “there’s a lot of outstanding programs out there, what’s important to me is that this is a place that cares deeply about the challenges that we’re seeing in this industry and about really adapting their programs to their future leaders.” It helps, he says, that Owen’s class sizes are so small — this year’s cohort, similar to recent past years, is only 179. That means around 30 to 35 students have a healthcare concentration, so each gets plenty of faculty and career attention.
Norton, now CEO at Vanderbilt Psychiatric Hospital and Clinics and executive director at Vanderbilt Behavioral Health, says “getting that very strong, rich background in the healthcare program at Owen allowed me to come in with somewhat of a head start and knowing where the industry is headed, because we’re talking a lot about how things are evolving and you’re able to learn about some of the potential disruptors and the ways that things are transforming. That helps you anticipate where things are moving. It gives you a vision for where we’re headed.”
The Simulation Operations Manager shows Vanderbilt Owen students around the lab. Hands-on training is a key part of the Vanderbilt healthcare MBA. Vanderbilt photo
Studying for a healthcare MBA at Owen means immersion into the industry in a way few other programs can match. A key element of its healthcare concentration is a week-long program in the fall of first year during which students learn about the practice of healthcare through the eyes of physicians, nurses, and patients. They watch actual surgeries being performed at Vanderbilt University Medical Center, and they visit the university’s other healthcare facilities like its Mass Spectrometry Research Center and its LifeFlight air medical transport service. They visit community clinics, as well. As one recent student described the experience, “With no medical background, all I knew about an emergency room or an operating room environment, I had learned from shows like ‘House.’ And it’s not really like that.”
When he left the Marine Corps to attend business school, Jameson Norton wasn’t sure what path he wanted to take. But very soon after starting at Owen, he took part in the healthcare immersion week — and his path became clear.
“As soon as I got ingrained within the healthcare program, not honestly knowing that healthcare was going to be my option, I got to experience the healthcare immersion program that Larry Van Horn runs. It was on fall break of my first year at Owen and I got to spend a night in the emergency room. And as soon as I did that, immediately it clicked — that this is the culture that I’m familiar with. These are my people in a sense that they are people who are intrinsically motivated, that care deeply about what they’re doing. You know, I felt it was the right alignment of things, in a sense.”
A ‘FIREHOSE’ FOR BUILDING MBAs’ EXPERIENCE BASE
Burch Wood, Vanderbilt Owen director of health care programs. Vanderbilt photo
Larry Van Horn is an associate professor of management and executive director of health affairs at Vanderbilt Owen. He’s also the founder and co-director of the school’s Center of Health Care Market Innovation and co-director, with former U.S. Senate Majority Leader Bill Frist, of the Nashville Health Care Council. Van Horn also organizes Owen’s one-week healthcare immersion for first-years, which he calls an essential part of giving students “an appreciation for where we are today, and how we got to where we are.”
The immersion is “something that’s unique that we do here that nobody else does in their graduate programs and businesses,” Van Horn tells Poets&Quants. “Over the course of this week students are in an operating room observing surgery, shadowing a nurse, they’re in emergency departments, ICUs. They go and observe at dialysis centers, ambulatory surgery centers — a lot of these experiences where they see healthcare and then we have 30-plus industry executives come in from all walks of life, all sectors, and talk to them about their experience, where they are and where the world’s going. So they get a firehose directed at building their experience base as fast as possible.”
A thought leader on healthcare organizations, managerial incentives in nonprofit hospitals, and the conduct of managed care firms, Van Horn has conducted research for major players in the industry and consulted for national consulting firms, managed care organizations, pharmaceutical firms, and foreign governments; currently he’s preparing “something to get some people’s attention” on the opioid crisis. He spends a lot of time on the road talking to healthcare audiences about a world that is constantly shifting, convulsing, adapting. “Where’s it gonna go? What’s gonna happen? What are people thinking about? What do they need to worry about? Part of my focus is on involving customers in healthcare. We have a little research center here that focuses on doing research into the shift in the way individuals are purchasing health care when they’re spending their own money. I figure you’d probably make different decisions when you’re spending your money as opposed to someone else’s.
“Healthcare’s been a world for the last 40 years where the assumption’s been, ‘I’m spending someone else’s money,’ but the world’s moving toward people having higher deductibles, health savings accounts, spending cash, making different purchase decisions, in different locations from different providers at different price points. And that’s a great thing for America, and that’s what I spend my time worried about.”
‘INTENSE EXPERIENCE’ LEADS TO BROADER UNDERSTANDING
Source of healthcare internships for Vanderbilt Owen MBA students. Source: Vanderbilt Owen
Why is it important for MBA students to see how healthcare is actually delivered. Burch Wood, Vanderbilt Owen director of health care programs, says it’s important to widen what may often be a narrow conception of the industry.
“I believe that you can’t change things unless you know how they work,” Wood tells P&Q. “And to know how they work, you’ve got to get an understanding both at the level of putting your feet where the work is being done and understanding how people are thinking about healthcare. And we try to mix that in the immersion experience.
“People might think very narrowly about what healthcare is. But in the course of this immersion, in the course of this intense experience, their eyes get opened to a much broader conceptualization about what healthcare is. And what their place in it could be.”
Another way Owen students find their place in the healthcare picture is through the program capstone, an eight- to nine-month consulting experience. Given Vanderbilt’s connection to so many healthcare businesses, the possibilities for what the capstone might entail are nearly limitless.
“We don’t just give them this educational background, which certainly gives them a very good foundation of layered business knowledge, but we try to put it into work,” Wood says. “We have a roughly eight- to nine-month consultative project that they work on in groups of about four or five people. They work on a real project to effect change in an organization that they are working in, to try to really change the way they do something, which is really interesting.”
Inside Management Hall, home of the Owen Graduate School of Management at Vanderbilt University. Marc Ethier photo
Vanderbilt Owen is 49 years old this year. That’s just one year younger than another Nashville icon, Hospital Corporation of America, the “granddaddy of the for-profit healthcare provider,” says Eric Johnson. HCA revolutionized the healthcare industry, and its story explains why Nashville became the healthcare capital of the U.S. — and why Vanderbilt became such an important healthcare school.
Before HCA, “You had this country full of individual hospitals, some were privately held, some were publicly held, some were for-profit,” Johnson says. “It was very fragmented. The whole idea behind HCA was to kind of roll up hospitals into a larger company and then build on scale advantages you could achieve out of that. So rather than every hospital having its own IT group, a lot of those service functions — IT, payroll, all the back-office stuff — could be centralized, and the hospitals could focus on delivery. That really was the idea behind HCA.
Today HCA is the largest of those hospital corps, managing 177 hospitals and 119 surgery centers in the U.S. and UK. What came behind it, Johnson says, is the whole industry of “healthcare as a service” — in particular the reality that at many hospitals, many of the employees are not employees of the hospital itself.
“So, for example, there was a whole roll-up of anesthesiologists, where now there’s a company based here and it actually does nothing but sell anesthesiology services to hospitals all over the country,” Johnson says. “ED doctors, same thing. Hospitalists, same thing. Skilled nursing, same thing. All these kind of different skill groups — radiology services are from another company, and they’re running around the hospital in scrubs and they look like they’re a hospital employee, but they don’t work for the hospital, they work for a company that’s providing a service to that hospital.
“And all of those companies, just so many of them, are here. They started here. They really were kind of an outgrowth of HCA, that concept, that kind of creating a service-based model around all these specialties. It just continues on and on and on, so now the big thing in Nashville these days are things like palliative care or post-acute care. You know, you have hip surgery and now you’ve got a rehab that’s gotta happen. How does that get managed, how does that get provided? And I think the reason why Americans wouldn’t think of Nashville as a healthcare city — because many of the names of those companies are not brands that are branded for consumers.”
EVERYTHING IN HEALTHCARE STARTS AT THE BEDSIDE
Source of healthcare full-time jobs for Vanderbilt Owen MBA graduates. Source: Vanderbilt Owen
Jeff Lenar graduated from the United States Naval Academy in May 2010 and immediately joined the Marine Corps. He spent seven years in the Corps before leaving active duty the summer of 2017 — but for 18 months prior to that the Atlanta native had planned to leave and go to business school. “I talked to some friends, mentors of mine, about what a career transition would look like and a lot of people specifically recommended looking at the healthcare industry and said a great way to make that jump is Vanderbilt Owen. ‘It’s in Nashville, it’s a great program, Nashville’s a huge healthcare town, and Owen is a very great school and they do a lot with healthcare.’
“So that led me initially to Owen. I started the application process and from the get-go I knew it was my number-one choice.”
Lenar, who will finish his MBA in the spring, plans to go to work for Nashville-based Acadia Healthcare, for which he interned this summer. He says that for healthcare-bound students, the Owen classroom experience is peerless. “I think we have some great professors that teach some great classes, and especially if you do not come from a healthcare background, like I didn’t coming out of the military, it’s very eye-opening from the get-go.
“Our first class that we take is Healthcare Economy and Policy, taught by Larry Van Horn, and it’s the opening to healthcare and what’s going on in the industry. It was a very eye-opening class for me.” Equally eye-opening: the immersion experience. Everything in healthcare, Lenar says, starts at the bedside.
“The healthcare industry is very vast, and in my personal opinion, it all originates at the bedside. You think of anything — the innovation, the technology, the M&A deals, I mean the entire industry — it starts at the bedside. So for me one of the most eye-opening experiences was shadowing a nurse. They’re in the trenches day in and day out, and it gives you great perspective. I already had a lot of respect for healthcare providers, but shadowing a nurse for like three hours gave me all kinds of respect for a very difficult job.”
‘IT’S JUST THE PLACE TO BE’
Vanderbilt Owen full-time healthcare offers 2008-2017. Source: Vanderbilt Owen
When it launched in 2005, the mission of the Vanderbilt Owen healthcare MBA program was to require more healthcare-specific courses than any other program of its kind in the nation. The explosion of the industry around the Vanderbilt campus in the years since has just been a bonus.
“It’s just the place to be,” Owen’s Director MBA Admissions Christie St. John tells Poets&Quants. “Why would you want to be anywhere else? Because you’ve got personalized attention — personalized services. All the alums, all the companies are right here at your fingertips.”
St. John was director of international relations at Vanderbilt Owen for six years until 2003, when she accepted a job at Dartmouth Tuck. When she returned to Nashville in 2012, she marveled at the change the city had undergone. It still amazes her.
“The odd thing is, years ago when I first worked here, nobody really wanted to stay in Nashville,” St. John says. “There wasn’t a lot going on then. And now even people from New York come down here and think, ‘I don’t want to leave.’”
DON’T MISS HEALTHCARE & THE MBA: AN INTERVIEW WITH VANDERBILT OWEN DEAN ERIC JOHNSON or VANDERBILT MOURNS LOSS OF ‘PART OF OWEN COMMUNITY FABRIC’
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