University of Pennsylvania Health System CEO Muller stepping down next year

The University of Pennsylvania announced Monday that Ralph W. Muller, who has been chief executive of the school's health system since 2003 and expanded the system to six hospitals from Princeton to Lancaster, will step down next year.

"Ralph's partnership, effective leadership, support of the academic mission and keen understanding of the evolving health care environment have been of great benefit to Penn Medicine and the university," University of Pennsylvania president Amy Gutmann and Perelman School of Medicine Dean J. Larry Jameson said in a note to the Penn Medicine community.

Jameson, who is also an executive vice president at the university with oversight of the health system, said in an interview that he expected the position to attract high interest nationally, but also that there are strong internal candidates. A selection could be made by mid-spring next year, leaving ample time before Muller's departure on June 30, 2019.

In addition to having a commitment to health-care quality and outcomes, thinking holistically about population health, and understanding how health-care policy relates to health-care delivery, Muller's successor will need experience in a fully integrated academic medical center, Jameson said. "That's going to shape a lot about the pool of people we'll be looking at," he said.

During Muller's tenure, which started just a few years after Penn had been on the verge of selling the system because of steep losses in the late 1990s, total revenue increased to $6.1 billion in the year ended June 30, 2017, from $1.9 billion in the year ended June 30, 2003. The system, which has started construction on a $1.5 billion patient tower at its main campus in University City, now has 2,802 licensed beds.

Penn acquired Chester County Hospital and Health System in 2013, Lancaster General Health in 2015, and Princeton HealthCare System this year.

Muller, who oversaw more than $3 billion of investments in facilities, cited a major expansion of outpatient care as one of Penn's major accomplishments during his tenure. The percentage of revenue from outpatients is approaching 60 percent, he said.

As to what challenges his successor will face, Muller, 72, said he expected turbulence in Washington to continue, though he doubts that the Affordable Care Act will be eliminated entirely. He also thinks the private, for-profit sector will continue pursing combinations, such as the proposed merger of CVS and Aetna, that are designed to have a broad impact.

"My successor is going to have to be attentive to that," Muller said.

He said he plans to remain active in health care nationally, but has no specific plans now.