Sandra L. Fenwick, chief executive of Boston Children’s Hospital, said Wednesday that she would retire next year, wrapping up a trailblazing four-decade career in which she became a national health care leader and advocate for children’s health.
Fenwick, 70, will have run the hospital for more than seven years when she steps down in March. Children’s, which has nearly 19,000 employees, said it has started the search for her successor.
The first woman to lead the 151-year-old hospital, Fenwick, who is not a doctor, cemented Children’s status as the country’s preeminent pediatric hospital while significantly improving its financial health. She will retire before completion of the new Hale Building, an 11-story expansion that she said was crucial to Children’s future and staunchly defended against criticism that it would drive up health care costs and required demolition of the beloved Prouty Garden.
“It’s never a perfect time to leave, professionally or personally,” Fenwick said in an interview, adding that she had planned to make the announcement earlier in the year but held off because of the coronavirus pandemic. “I believe we are in an extraordinarily good place. It seems like the right time [to turn leadership] over to the next generation.”
Fenwick came up through the business ranks of health care, spending more than 20 years at Beth Israel Hospital and earning a reputation as a financial and operations expert, before joining Children’s in 1999 as senior vice president for business development.
Prior to being promoted to CEO at Children’s, Fenwick spent six years as president and chief operating officer under her predecessor, Dr. James Mandell.
“She worked seamlessly with Mandell,” said Stephen R. Karp, the real estate developer and chair of Children’s board of trustees for 15 years until 2019. When it came time to pick a successor for Mandell, “We voted not to do a national search. We thought we had the best person in the country in Sandi,” said Karp, who remains a trustee.
Throughout Fenwick’s tenure as CEO, Children’s has been ranked the top pediatric hospital in the nation by US News & World Report. She steadily increased the hospital’s research budget, to $410.5 million in 2019 from $308 million in 2013, and takes pride in highlighting the breakthrough therapies and cures that its research has produced. She spearheaded a fund-raising campaign that brought in $1.54 billion between 2012 and 2019.
Children’s is one of the wealthiest hospitals in the state — and one of the most expensive. Its net assets were $4 billion in fiscal 2018, the latest year for which the data is public, more than the combined assets of Mass General and Brigham and Women’s.
To Alan Sager, a professor at the Boston University School of Public Health, some of that accumulated wealth could be used to make care more accessible and affordable.
“Can we afford not to have Children’s? The answer is clearly no,” Sager said. “Can we afford the hospital as it is and as expenses continue to grow? Probably not.”
Children’s, like other hospitals, has taken a financial hit this year from the coronavirus, which forced the cancellation of nonemergency care and increased expenses. Fenwick said patient revenue is down $155 million compared with the start-of-the-year budget, though the hospital has received $89 million in federal relief funds. Unlike some other hospitals, Children’s has not furloughed or laid off employees.
“She is not a bean counter,” said Douglas Berthiaume, who took over from Karp as chair of the board of trustees. “She is thoughtful. I marvel at her ability to understand the clinical needs of the organization.”
It was the clinical needs of the hospital that drove Fenwick’s decision to push ahead with a $1 billion expansion of its Longwood Medical Area campus. The move raised concerns among some health insurers, employer groups, and the state’s health care watchdog agency that Children’s would siphon patients from less expensive hospitals and increase the state’s spending on medical care. The demolition of the Prouty Garden, long a haven for patients and their families, sparked an unsuccessful lawsuit by supporters of the garden to block construction.
But Fenwick argued that Children’s facilities were outdated and cramped, and said the expansion, which would add 150 beds, would meet demand mostly from other parts of the country and overseas. Several quiet open spaces were included in the design of the revamped campus.
The Massachusetts Public Health Council approved the project in 2016, but it imposed conditions that would penalize Children’s if it fails to keep health cost increases within limits. Children’s expects the Hale Building to open in the summer of 2022, after the coronavirus crisis delayed construction by about six months.
Asked if in retrospect she would have handled the expansion differently, Fenwick said, “Could we have communicated more frequently? You can always do more.”
Fenwick was not the first woman to lead a Boston hospital, nor was she the city’s first hospital CEO without a medical degree (she earned a master’s in public health at the University of Texas). But her business savvy, composure under pressure, and rapport with the medical staff have made her a respected leader in Boston and nationally.
“She set a high bar for so many women,” said Deborah Jackson, president of Cambridge College, who frequently collaborated with Fenwick while Fenwick was at Beth Israel and Jackson worked at Children’s. “She is grace under pressure. She is smart and so gracious and thoughtful.”
Fenwick was paid $2.1 million in salary and bonus in 2018, the latest year for which compensation data is public, an increase of 11 percent over 2017. She joined the board of Livongo, a digital health company, last year and was granted stock valued at $1.1 million; she held 75,000 restricted stock units at the end of 2019. Livongo has agreed to be acquired by Teladoc in a deal that currently values Livongo at $129 a share.
Fenwick was quick to credit her colleagues for the hospital’s success, saying it’s been “an extraordinary honor to lead such an exceptional team of talented and devoted people.”
What’s the biggest challenge the next CEO will face?
“There are always going to be things we never expected,” Fenwick said. Her successor “will need to be agile and respond to challenges and opportunities.”
More important, she hopes Children’s next leader will continue her work advocating for children and pediatric health.
“When children thrive, society will thrive,” she said.
Larry Edelman can be reached at firstname.lastname@example.org. Follow him on Twitter @GlobeNewsEd.