How John Federspiel Led the Hudson Valley Hospital Center to Success

John Federspiel resuscitated Peekskill Community Hospital and revived it into the now-thriving Hudson Valley Hospital Center.



Photo by Chris Ware

If you’re trying to hunt down John Federspiel on a weekday, you won’t have much difficulty. The 57-year-old president of the 128-bed Hudson Valley Hospital Center (HVHC) in Cortlandt Manor is generally either at work at the hospital or out at a social gig on behalf of it. On weekends, you can find the divorced father of three grown sons "fund-raising and friend-raising.” And that’s been his schedule for the last 25 years. The result? Federspiel’s quarter decade of dedication has turned what was sleepy little Peekskill Community Hospital, founded in 1889, into the booming HVHC of today.

He guided HVHC through a financial turnaround in 1991 and doubled its square footage with an addition that included an expanded emergency-services department, state-of-the-art surgical suites, an ambulatory-surgery unit, comprehensive high-tech labs, and a cardio-pulmonary rehabilitation space. He also brought HVHC outpatient services and physicians’ offices to nearby Croton-on-Hudson, Putnam Valley, Montrose, Cold Spring, Hopewell Junction, and Mahopac, New York. The budget has zoomed from $18 million the year Federspiel started (1987) to $162 million in 2012, and the number of employees has soared from 400 to nearly 1,400. What was once a hospital with a doubtful reputation has been transformed into a fully accredited, general, not-for-profit medical center.

When Federspiel took over the top job at the hospital, however, all that seemed far away. It was 1987, and, at 33 years old, he was the youngest hospital president in New York State. At the time, he says, “we were losing about a million dollars a year on a million-dollar budget and had less than a million in cash left.” When he first got to the hospital, "John was adamant about improving it,” says former HVHC board member and former New York Governor George Pataki, who also served two terms as mayor of Peekskill. "He was able to bring a lot of great people to the hospital, from administrators to the medical staff.”

So how did a hospital with a questionable reputation go from diving to thriving? Federspiel knew that, first, employee morale had to rise. “If somebody is really dissatisfied with their job, their performance is going to reflect that, along with the patient-satisfaction scores,” he says. Thus, to improve morale—and, by extension, patient experiences—he launched several programs that continue today. The day before Thanksgiving, for example, management presents staff members with apple and pumpkin pies. Each December, a lavish holiday party is held for the staff, while a potluck open house is hosted by the administration; Federspiel bakes everyone chocolate-chip cookies for it. Other perks include performance-related gift certificates and employee picnics.

As a result, the hospital’s most recent employee-satisfaction survey placed it in the 93rd percentile of hospitals nationwide, and its turnover rate among nurses is low—3 percent (as opposed to 7 percent statewide). In 2006, HVHC also received the Success Story Award, one of seven honors given out yearly by Press Ganey, the most prominent company working with hospitals to improve healthcare. That honor was followed in 2007 by a Forbes Enterprise Award, which recognizes outstanding small businesses for their achievements. The Studer Group, another industry group, bestowed on HVHC a Fire Starter award in 2008, noting that HVHC’s “success was accomplished due to full commitment at the top, and full buy-in from so many dedicated front-line staff.” And, if that weren’t enough, HVHC was recognized as a Magnet hospital (for nursing excellence) by the American Nurses Credentialing Center in 2007, the first hospital between New York City and Albany to receive that honor.

Federspiel himself and his famous congeniality are big contributors to HVHC’s upbeat culture, which helped garner these awards. Everyone, for instance, calls the president by his first name. “John isn’t stuffy, fluffy, or pretentious,” says HVHC Chief Financial Officer Mark Webster. “People go up to him in the hallway and shoot the breeze with him. He won’t ask you to do anything that he wouldn’t do himself. If he says, ‘I need fourteen hours out of you,’ he’ll give fifteen.”

When Hurricane Irene roared through last summer, Federspiel stood in the front lobby at 6:30 am to greet and thank people for coming in. And, during last October’s freak snowstorm, Federspiel recalls, “When we started giving out free food from the cafeteria, the cooks and servers got so overwhelmed that I went behind the counter and started slinging the eggs.”

Says Federspiel, “We pay competitive salaries, but we’re not the highest paying. That’s why we have to make more of an effort to be loyal to our employees and always have things to offer.” For instance, there's free parking and the cafeteria’s prices are substantially subsidized. In addition, HVHC has never had layoffs, as opposed to, say, Westchester Medical Center, which announced that it was downsizing by 250 employees and that it faced a $61 million shortfall in 2012.

Instead, in June 2010, HVHC premiered its four-story, 83,000-square-foot, 84-bed, all-private-room patient tower; 450-space parking garage; new lobby and gift shop; expanded and renovated no-wait emergency department with 39 treatment bays; additional operating rooms; and four new critical-care patient rooms. Last November, the institution completed its second major expansion: a new office building and a $12 million Comprehensive Cancer Center that wooed the world-renowned Ashikari Breast Center and the pioneering New York Group for Plastic Surgery to the hospital.

Federspiel had some medical background in the family. His mother was a nurse, as are his sisters and some aunts and cousins. His father owned and ran a local tavern. “My father put a couple of his kids through college selling ten-cent beers.” Federspiel’s medical career started—well, sort of—when he was a young teen. When his mom was working weekends as a medical-surgical nurse and the staff was shorthanded, she’d ask her son to don a lab coat and fill water pitchers, take specimens to the lab, and do other minor but important chores. He earned a BS in marketing from The Ohio State University. While working towards an MBA in health administration from Temple University (which he earned in 1987), Federspiel made money as an orderly at a number of hospitals. “It gave me great exposure to and an appreciation for how hard hospital staff work and the stress they undergo day in and day out,” Federspiel says.

At 23, he was the youngest employee on the payroll—as the administrator—of a 180-bed nursing home in Pennsylvania. He also worked as associate executive director at two hospitals in New Jersey. He truly earned his stripes when, in 1983 at age 29, he became senior vice president at Saint Mary Hospital, one of 11 hospitals in the Sisters of St. Francis of Philadelphia hospital system. Then, finally, HVHC.

Any plans to move on? None, he says. But, he assures, “the board of directors is attentive to succession planning, as they should be. I would like to say that probably all eight of my direct reports have been groomed to be considered as replacements. They are that good.”

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