Crain's Detroit Business, June 3, 2019 issue by Crain's Detroit Business

Other Voices: Restoring Earned Income Tax Credit benefits all Page 6 Gilda Z. Jacobs, president and CEO of the Michigan League for Public Policy

Southwest Detroit neighborhood gears up for Ford Page 3

JUNE 3 - 9, 2019 | crainsdetroit.com

MACKINAC POLICY CONFERENCE

TECHNOLOGY

‘Fortnite’ maker Epic Games to open office in Detroit

Uncertainty looms for hospitals under new auto insurance law

By Timothy J. Seppala Special to Crain's Detroit Business

Fortnite maker Epic Games is coming to Detroit. Not to shift development of the wildly popular online game from Epic’s headquarters in Cary, N.C., to the Motor City, but to better serve its growing number of automotive clients using Unreal Engine. Unreal Engine is an end-to-end game design toolset capable of rendering photorealistic imagery on the fly. Ford used an Unreal-powered VR

“You can only understand how the industry will develop and what it needs if you’re a part of the project and you’re where the stuff is happening.” DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

Gov. Gretchen Whitmer signs SB 1, the no-fault auto insurance reform bill, on the porch of the Grand Hotel during the Mackinac Policy Conference on Thursday.

Health care, employers, insurance business have decisions to make By Chad Livengood clivengood@crain.com

MACKINAC ISLAND — A Beaumont Health executive says the suburban Detroit hospital system stands to lose “multiple tens of millions of dollars” in annual revenue through the fee schedule imposed by the auto insurance reform law Gov. Gretchen Whitmer signed at the Mackinac Policy Conference last week. “We have early estimates and our estimates are concerning for us — in the multiple tens of millions of

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dollars of loss in revenue for Beaumont Health,” said Carolyn Wilson, chief operating officer of Southfield-based Beaumont Health. “It will be very significant for us and other health systems in the state of Michigan.” Amid the celebration of a monumental legislative achievement by Whitmer and legislative leaders on both sides of the aisle at last week’s annual Detroit Regional Chamber confab, the multibillion-dollar medical industry that’s been built up over four decades around the limit-

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utilizing play therapy. How is that working? Leibert: Often kids don’t have the language to wrap around their experiences. Play therapy is their language. We want to go into their world, instead of sitting in a talk therapy setting—that’s the grown-up world. Burns: What are you seeing with teenagers and college-age people? Are you seeing more anxiety? Leibert: Anxiety is definitely on the increase. Anxiety will come in two forms. It will come with perfectionism—“I'm scared unless I can do things perfectly, because I'm afraid of being judged.” Or it might be that they give up—“I'm giving up, why try?” Burns: That also has something to do with resilience, doesn’t it? Leibert: Some kids are very resilient. That depends on how resourced they are with their support system. Resilience is built through mistakes. When bad things happen we want to resource them with the ability to say, “I can stumble and fall and I can get up. I have the resources I need within me, not only externally, to be able to get back up again.”

the world will converge and it will be a great time for everybody to come to Detroit. Burns: Are you seeing the emergence of Detroit? Alberts: Completely. It takes a village, as they say, or a city, but Dan Gilbert’s been a great leader. Look what he’s done with developing downtown and making it safer. It’s a real experience from beginning to end, but it takes many pieces to really put Detroit out front on a global stage so we can change perceptions. Shinola Hotel is open and we have 180 restaurants in Detroit now. Everything is in walking distance. I think it’s already been changed a lot, but we can do some more. Burns: Will the Charity Preview change? Alberts: The jury’s still out on what we do on that. Maybe make it a little bit more chic, determine whether or not it’s black tie. Tradition is meant to be broken sometimes, and we have to decide whether this is one of those moments. In the end the focus is the attendees having a great time and raising money for children and charities.

Gary Cates, Chief Philanthropy Officer, Promedica Larry Burns: Tell us about ProMedica and how it is evolving as a major integrated health system in the United States. Cates: ProMedica is a health and wellness organization. We’re based in Toledo but have facilities in southeast and south-central Michigan. We have hospitals in Monroe, Tecumseh, Adrian and Coldwater. We recently acquired HCR ManorCare, headquartered in Toledo. That deal put the ProMedica organization in 28 states. We have about 400 facilities around the country in the senior living space. We’re evolving, growing, and taking a look at the overall health and wellness of individuals, which goes beyond hospitals. Burns: The HCR ManorCare is a huge deal. Cates: They’d fallen on tough times. When the deal was first announced, many in the industry wondered why ProMedica was acquiring the nation’s second-largest provider in the skilled nursing, memory care, home health and hospice care. Afterwards, considering the demographics of this nation — what we call the silver tsunami — they realized we were crazy like a fox. On top of it being a good acquisition for ProMedica, it was really a good move for Toledo, hopefully keeping about 1,500 jobs in our community. Burns: What are your thoughts about having a presence, not only in Michigan, but possibly Detroit? Cates: Toledo is Detroit’s neighbor to the south and I think a strong relationship between the two communities is important,

given they are dealing with many of the same types of issues. One of the largest issues facing both communities is the need for pediatric psychiatric services. The need for long-term care is also particularly acute. Burns: Tell us about some of the innovative things you’re doing in Toledo. Cates: There are social determinants of health — hunger, housing, education, employment, transportation — ten dimensions in all. Research has demonstrated that 80 percent of health and wellbeing has to do with social determinants. The other 20 percent is impacted by what we do clinically. So if we’re going to address overall health and wellbeing in our communities, we’ve got to step outside the four walls of institutions like hospitals. Burns: Tell us about prescription grocery facility you have in Toledo. Cates: In our “food pharmacy” we do two things—send people home with several days’ supply of food and plug them into appropriate services in the community. Because it’s one thing to meet an immediate need, but what we really need to do is break the cycle.

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

OPINION COMMENTARY

When the unexpected strikes, culture matters more

ome business leaders — founders and CEOs especially — probably had one of two thoughts last week as news about Dan Gilbert’s stroke spread: When was my last physical? What would happen to my company if I were hospitalized for a serious health issue? A third question circulated throughout the early hours of the Detroit Regional Chamber’s Mackinac Policy Conference last week: “What have you heard about Dan Gilbert?” There was genuine concern, of course. But there was also an implied fear of what might happen if the visionary investor were sidelined. As Detroit News columnist Nolan Finley noted last Monday: “No other city in America is as heavily dependent on the commitment of a single individual as Detroit is on Gilbert’s.” When a privately held, essentially family-owned company loses its highly visible leader, even for a short time, it’s an opportunity for the entire team to rally behind what that leader built and stands for. And for leadership at all levels to emerge even stronger. At the conference last week, Bill Emerson, vice chairman of Quicken Loans and Rock Holdings, the corporate parent of Quicken Loans, took Gilbert’s place on stage in a fireside chat with Dennis Archer Jr. Emerson stressed the experience and long tenure — 20+ years or more — for key leaders, including himself and other CEOs in Gilbert’s “family of companies.” And he took attendees through the litany of projects

When a privately held, essentially family-owned company loses its highly visible leader, even for a short time, it’s an opportunity for the entire team to rally behind what that leader built and stands for.

MARY KRAMER Group Publisher

moving ahead in Gilbertland, including the upcoming PGA event at the Detroit Golf Club. For many, it might have been the first time they had seen or heard Em-

erson. But he embodies the culture that Gilbert and his team have built at all levels of the organization. Gilbert is famous for his “isms” book. When he was named Crain’s Newsmaker of the Year for 2006, he used his speech to describe the culture that empowers employees to take responsibility, go above and beyond to serve customers and co-workers and throw out ideas to make the company better. That culture will serve the “family of companies” well during this crisis. Culture matters. Another example: Jack Roush, founder of Roush Enterprises, an automotive engineering

company that has designed and built cutting-edge engines and more recently, driverless vehicles for Google’s sister company Waymo. In a story earlier this year, Crain’s Dustin Walsh described the culture Roush has built, creating “an allegiance of highly motivated dreamers, tinkerers of all things steel, oil and wheels. And, he was their leader, an automotive Willy Wonka.” He started building the culture on Day 1, and it continued in 2002, the year the small plane he was piloting hit a power line and crashed, sidelining Roush for a time. Culture mattered at Crain Commu-

nications when our second-generation leader, Keith Crain, underwent surgery in 2016 that had unanticipated problems. He was out for months. Our company rallied around the third-generation leader, KC Crain, now president of our company and publisher of Crain’s Detroit Business. Keith always has espoused the mantra of his father, G.D. Crain, who offered this simple formula for his publishing business: “Readers first.” When the corporate and brand leadership of Crain met earlier this year to focus on strategy going forward, we used a different word — Audience — but the diagram was the same. Readers/Audience were the center of our world, and all financial results would come from that center. The best gift you can give a leader is to offer the assurance that the culture he or she has built is so much a part of the DNA that business continues — and thrives. Mary Kramer is group publisher of Crain’s Detroit Business. Listen to her and Managing Editor Michael Lee talk about the week’s stories every Monday morning at 6:15 a.m. Mondays on WJR 760 AM’s Paul W. Smith Show.

SEND YOUR LETTERS J Crain’s Detroit Business will consider for publication all signed letters to the editor that do not defame individuals or organizations. Letters may be edited for length and clarity. Email: mlee@crain.com

Restoring Earned Income Tax Credit benefits workers, businesses T

he federal and state Earned Income Tax Credit (EITC) is arguably one of the most effective and beloved policies on our books today. What other policy boasts a list of supporters that includes presidents Gerald Ford, Ronald Reagan, and Barack Obama, former U.S. House Speaker Paul Ryan, as well as Gov. Jennifer Granholm, former House Speaker Craig DeRoche, former Senate Majority Leader Ken Sikkema, and Detroit Mayor Mike Duggan here in Michigan? And we can add Gov. Gretchen Whitmer, who included doubling the state EITC to 12 percent of the federal EITC in her 2020 budget proposal, to that long list of bipartisan supporters. There’s a reason the EITC is usually looked at so favorably by Republicans and Democrats alike. While the credit benefits families directly, it has a ripple effect on local businesses and communities. And it is available to and utilized by residents in our state’s urban and rural areas — and red and blue legislative districts — alike. The federal EITC was first enacted under Michigan’s own President Gerald Ford in 1975, and the past six U.S. presidents who followed have signed a federal EITC expansion into law.

OTHER VOICES Gilda Z. Jacobs

Michigan’s EITC is available to any state taxpayers who file for the federal EITC, and the credits serve the same purpose. And while they generally share the same bipartisan support, our state EITC hasn’t enjoyed the same steady, upward trajectory as its federal counterpart. In fact, in 2011 it was almost eliminated entirely under Gov. Rick Snyder’s massive tax shift, which asked residents to pay more so businesses could pay less—a shift our workers are still feeling the pain of today. The Michigan League for Public Policy and a broad coalition of advocates— including the Midwest Independent Retailers Association, the Community Economic Development Association of Michigan, AARP-Michigan, and then-Detroit Mayor Dave Bing—

successfully fought to save it. Keeping it alive in our laws was huge, but Michigan’s EITC still took a massive hit. The credit was cut from 20 percent of the federal credit to just 6 percent of the federal credit. Since 2011, Michigan’s EITC and the working families who rely on it have been quietly surviving and waiting for a better political climate to come. That’s why Gov. Whitmer’s proposal to bump it back up is so significant. And a majority of Michigan residents see that as clearly as she does, with 67 percent of Michiganders favoring a state EITC increase, according to an EPIC-MRA poll conducted in March. Boosting the credit is a good step in undoing the damage of the 2011 cut and restoring the state EITC’s impact on Michigan workers, businesses and economy. The credit has a significant impact on the households that receive it. It promotes work and is the best remedy for poverty in our toolbox. The EITC not only improves economic security, but other outcomes, as well. Among kids in families that receive the EITC, there are improvements in nutrition and educational and economic attainment, and a decreased incidence of low birthweight. A re-

cent study by the University of California even found that increasing the EITC could help reduce suicide and drug and alcohol deaths in people who are financially struggling. But beyond the benefits for working families, the EITC has a major impact on the communities they live in, as the money is usually spent on financial needs like bills, groceries, car repairs or a new appliance. For the 2017 tax year, more than 748,500 Michigan households (about 15.6 percent) received the state EITC. At an average credit of $150, that pumped more than $112 million back into the state economy. The total impact for Wayne, Oakland and Macomb counties: about 305,010 taxpayers received the Michigan EITC at an average of $163, spending $49.6 million locally. Looking at Detroit alone, about 110,520 taxpayers (35.1 percent of filers) received an average Michigan EITC of $191. This means the city saw $21.1 million end up in Detroit cash registers and balance sheets. And if Gov. Whitmer’s proposed restoration were in place, it could double the economic impact on families, communities and local economies to the tune of around $224 million statewide.

These are the numbers of greatest interest to Crain’s readers, but the EITC’s impact is felt across the state. A recent study by Michigan State University found that Gov. Whitmer’s proposed increase of the Michigan EITC would result in $95.2 million in added economic activity for an estimated 335,000 rural residents, with the largest economic impact taking place in northern counties of the Lower Peninsula The Michigan EITC’s benefits touch every corner of our state. But it can and should be doing so much more. Gov. Whitmer’s proposed doubling of Michigan’s EITC has rightfully restored the public and political interest in the credit. Now we need action to restore the state credit itself. As the state budget process now shifts into its post-Mackinac Policy Conference gear, it’s incumbent on lawmakers to work with the governor to restore our state EITC, better support Michigan’s struggling families and unleash more of the credit’s purchasing power in metro Detroit and communities around the state. Gilda Z. Jacobs is the president and CEO of the Michigan League for Public Policy.

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COMMENTARY

Patti Poppe: Mackinac plants seeds for state’s future

he Detroit Regional Chamber’s 2019 Mackinac Policy Conference gave us the opportunity to hear from policymakers like our new governor and some potential future national news breakers like Stacey Abrams of Georgia and John Kasich of Ohio. Additionally, hearing from people such as Mayor Mike Duggan, our federal legislators and the quadrant leaders in Michigan solidified how much all our thought leaders want to prepare, grow and love Michigan. We have a lot to do to keep Michigan moving forward, and it is much more likely to happen when we stand for One Michigan. Our state is competing on a global stage for prosperity, opportunity and equity for all of our citizens. We must stand together for our collective futures, for our state’s prosperity and for our children’s opportunities, right here at home. This year’s conference was an opportunity to clarify our mission and take our to-do’s to the next level both today and for the next generation. The first pillar of “Prepare Michigan” aims to carry a thoughtful and focused conversation on education and job readiness as a fundamental attribute of a competitive state. I think of each child in Michigan like a tiny seed in our hand counting on us to prepare the soil for their future. Right now, their soil does not have the proper nutrients to enable them to thrive for future opportunities. We are in an education crisis in Michigan. Our schools are falling behind other states, while America is falling further behind the rest of the world. We let the sun shine on our education gaps during a block of sessions on Thursday featuring a collection of speakers and panels that cultivated the conversation and helped get the message out to the rest of Michigan. Launch Michigan, a broad coalition of labor, business leaders, philanthropists and educators discussed the hard work of staying at the table even when there is disagreement. I am personally hopeful Launch Michigan will deliver on the request of the governor and legislative leaders to present a report with a recommended solution by Dec. 1. There is one point I want to make perfectly clear: Teachers are not to be blamed. We absolutely LOVE Michigan teachers and we sent a postcard from the island via the Donors Choose crowdsourcing campaign from conference attendees to support projects in their classrooms. The tally is not complete, as donations are still coming in, but the goal was to fund at least 500 requests from teachers across the state. Our second pillar of “Grow Michigan” was all about economic development and entrepreneurship. Each of those seeds has the potential to grow into an entrepreneur, like Alisyn Malek, the founder and CEO of May Mobility, a ride-sharing autonomous car service based in Michigan. She shared with us a glimpse into why she picked Michigan, what is working and what isn’t. A great Michigan entrepreneur joined us on stage: Ari Weinzweig, founder of Zingerman’s Community of Businesses in Ann Arbor. Ari doubled down on Michigan and incubated a family of businesses based in

OTHER VOICES Patti Poppe

Ann Arbor. The third pillar of “Love Michigan” stressed the message of sustainability and stewardship to better our state.

Business leaders are often painted with a broad brush of profit maximizers or individualists driven solely by the bottom line. Consumers Energy was a company that set out to dispel that myth through closing seven coal-fueled power plants in 2016, which reduced our carbon emissions by 38 percent — well ahead of any global standard. We balanced caring for our planet and co-workers by assuring they were prepared for the transition with new jobs or retirement. We worked with local communities. This an example of Consumers Energy’s triple

The first pillar of “Prepare Michigan” aims to carry a thoughtful and focused conversation on education and job readiness as a fundamental attribute of a competitive state.

bottom line of serving People, Planet and Prosperity, in action. Throughout the entire week, I was reminded of the Greek Proverb: “Society grows great when people plant trees whose shade they know they shall never enjoy.” Carrying on these conversations with over 1,700 statewide leaders surely helped to plant some trees to prepare, grow and love Michigan for decades to come. Consumers Energy CEO Patti Poppe chaired the 2019 Mackinac Policy Conference.

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Nominate a budding leader, colleague, friend or employee for participation in our fifth cohort. Contact Keenan Covington at kcovington@crain.com or visit crainsdetroit.com/leadershipacademy.

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HEALTH CARE HEROES What makes a health care hero? This year’s Health Care Heroes are health care professionals who have gone above and beyond to change the lives of their patients, their institutions and the communities they serve. Their innovations have improved lives in quantity and quality. Their leadership has guided institutions through meaningful growth and change. Their partnerships have changed neighborhoods from Detroit to Kathmandu. This year’s awardees were selected from nominations by a panel of judges: JJChris Allen, founding CEO of Authority Health; 2018 Health Care Hero JJGreg Auner, Professor, Department of Surgery and Biomedical Engineering and Paul Strauss Endowed Chair, Wayne State University School of Medicine; Founder and Chief Science and Technical Officer, Seraph BioSciences; 2018 Health Care Hero JJTolulope Sonuyi, M.D., M.Sc., Assistant Professor, Wayne State University Department of Emergency Medicine; Detroit Medical Center: Sinai-Grace Hospital/Detroit Receiving Hospital; Founder and Medical Director, Detroit Life is Valuable Everyday (DLIVE); 2018 Health Care Hero JJJay Greene, Senior Reporter, Crain's Detroit Business

An event celebrating the winners will be held in conjunction with Crain’s Health Care Leadership Summit in October.

2019 WINNERS PHYSICIAN this page Richard Keidan, M.D. Elisabeth Heath INNOVATION Page 11 Thomas Forbes Adele Myszenski ALLIED HEALTH Pages 12-13 Kathleen Grobbel Danielle Bastien Philip Muccio ADMINISTRATOR Pages 12, 15 Tina Freese Decker Ewa Matuszewski CORPORATE ACHIEVEMENT Page 14 Lenora Hardy-Foster Richard Boothman

PHYSICIAN

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Richard Keidan, M.D.

President and Founder, Detroit2Nepal Foundation; Surgical Oncologist, Beaumont Health By Doug Henze

Special to Crain’s Detroit Business

Richard Keidan, M.D.

PHYSICIAN

Elisabeth Heath

Associate Center Director of Translational Sciences, Karmanos Cancer Institute, and Professor of Oncology, Wayne State University School of Medicine By Jay Greene jgreene@crain.com

As one of the top oncologists at Barbara Ann Karmanos Cancer Institute in Detroit and associate center director of translational sciences and professor of oncology at Wayne State University School of Medicine, Elisabeth Heath, M.D., sees her role as not only mentoring students and residents, but also cancer survivors. Heath pioneered what is now a national movement called the Prostate Cancer Advocacy Program, a project that trains 10 cancer survivors and caregivers annually to enhance Karmanos’ community education, awareness and screening efforts, especially within the African American community. Heath launched the project in 2009. The cancer survivor advocates, which now number more than 27 and have expanded to other cancers, attend health fairs and community events and talk with people about the importance of seeing a doctor annually to prevent and detect the disease when it is most treatable. Prostate cancer is the second leading cause of cancer-related deaths among males in the United States. One in seven men will be diagnosed with prostate cancer within their lifetime. African American men have a nearly two-fold higher

Elisabeth Heath

mortality rate compared to white men. Heath said African American men often present with higher prostate-specific antigen, or PSA, levels and more advanced disease than other groups, a problem that is not fully understood. “This is the crux of many research endeavors here. It is a statistic, but for me it is reality,” said Heath, who specializes in genitourinary oncology — cancers of the

urinary system that include prostate, bladder and urethra. “I am always flabbergasted. So and so had back pain, shoveling snow. (We test and the) PSA is 3,000,” Heath said. (The normal PSA levels for those age 60 is less than four.) “The message surrounding PSA is so murky. A lot of people don’t know if they need to see a doctor. It’s all about education. We need more of it getting out to the public,” Heath said. “You’d be surprised.” For example, Heath said at health fairs she attends, she meets women who are upset and men who seem confused. “Women ask me, ‘Why can’t I get a prostate screen?’ Some men didn’t even know they had a prostate. The basic level of understanding of what a prostate is (very low),” she said. Heath said this is one of the major reasons why the cancer advocates’ job is so important. Advocates are trained not to give medical advice, but to tell their own story. “Doctors can only advise so much,” Heath said. Heath said other advocacy groups have been formed at leading cancer centers, including Memorial Sloan Kettering Cancer Center, Weill Cornell Medicine Sandra and Edward Meyer Cancer Center and Herbert Irving Comprehensive Cancer Center Columbia University. The next group will form at the Masonic

Cancer Center-University of Minnesota. “Our ultimate goal is to translate this to the community. We have ongoing monthly events that these lovely advocates go to teach others,” she said. The advocates also help present at Karmanos’ annual prostate cancer symposium, usually held in September. The symposium, which is free and open to the public, presents information on genetics, genomics and the latest breakthroughs and treatments of precision medicine. “I am super grateful for the community I am in with collaborative colleagues who are a terrific group of people,” Heath said. “From a research perspective, we are at the cusp of something terrific with precision medicine. Over this year and next year, we will be sequencing people’s cancer, 22,000 genes and millions of RNA, at Wayne State. We have terabytes of data, and have the tools to take it to the next level.” Originally from Bangkok, Thailand, Heath grew up in Jakarta, Indonesia, and then moved to New Jersey when she was 9. She earned her medical degree in 1993 at Thomas Jefferson University in Philadelphia, did her residency in internal medicine at Georgetown University Hospital in Washington, D.C., and completed a medical oncology fellowship at Johns Hopkins in Baltimore.

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SPECIAL REPORT: HEALTH CARE HEROES INNOVATION

Thomas Forbes

Pediatric Cardiologist, Director, Cardiac Catheterization Laboratory (MD, FACC, FSCAI), Children’s Hospital of Michigan By Doug Henze

Special to Crain’s Detroit Business

A birth defect common to the tiniest premature infants can result in traumatic corrective surgery for already vulnerable newborns. But a new effort led by pediatric cardiologist Thomas Forbes at Children’s Hospital of Michigan in Detroit is showing promise as a less intrusive alternative. “I think this is exciting,” said Forbes, who has been on staff at the hospital since 1997 and director of the cardiac catheterization laboratory since 2001. “The surgery approach to this is invasive.” The new procedure addresses a medical condition known as patent ductus arteriosus, in which a connection between the aorta and pul-

Thomas Forbes

monary artery doesn’t close, as it should, at birth. While only about 1 percent to 2 percent of full-term babies suffer from the condition, it affects about 75 percent to 80 percent of babies born at 24 weeks or earlier. “It tends to flood the lungs with extra blood,” Forbes said. “It really causes the lungs to be congested and causes (newborns) to be on a ventilator for a longer period. It can also cause bleeding in the brain and can cause problems with bowels and kidneys.” Doctors first try to fix the problem with a medicine called indomethacin, but that fails 80 percent of the time in the smallest infants, Forbes said. The next step is surgery — doctors perform 10,000 to 13,000 a year nationwide, he said. The procedure requires doctors to

open the child’s tiny chest and then to collapse the left lung to close the opening. It has a mortality rate of up to 10 percent. “It’s traumatic to the infant, certainly,” said Forbes, who holds a medical degree from Creighton University in Omaha. “Of all the complicated procedures we do, this, by far, has the highest complications.” Forbes’ team was one of the first in the nation approved by the U.S. Food and Drug Administration to test the new procedure, which involves insertion of a dumbbell-shaped nickel-and-titanium plug. Instead of opening the chest, doctors run a 1.2-millimeter catheter through a leg vein, completing the procedure in as little as 12 minutes. Doctors have had a 98 percent suc-

cess rate — absent of serious complications — with the procedure, Forbes said. “We’ve not had any morbidity associated with the device closure procedure,” he said. Children’s Hospital began participating in the FDA trial 18 months ago. Nine hospitals across the country now are approved to insert the Abbott Laboratories-designed device. In June, Forbes will begin training medical professionals from outside the hospital on the procedure. Although the treatment is evolving, it’s already providing relief to some of the hospital’s most susceptible patients, Forbes said. “If (there’s) a significant ductus, there’s no question the quality of life is going to improve,” he said.

INNOVATION

Adele Myszenski Physical Therapy Supervisor, Henry Ford Health System By Doug Henze

Special to Crain's Detroit Business

When critically ill patients were admitted to Henry Ford Hospital’s intensive care unit in the past, the physical rehabilitation team faced a hands-off policy. “We thought they were too sick to be worked with,” said Adele Myszenski, a physical therapist and rehabilitation services supervisor at the hospital’s main campus in Detroit. But after weeks on bedrest and a ventilator, ICU patients’ muscles aren’t always functional. “I had a couple patients who were not able to do anything — their muscles were paralyzed,” said Myszenski, a therapist for 18 years. “We knew that waiting until they were too weak to do things wasn’t good for the patient.” Based on her observations and on programs underway at The Johns Hopkins Hospital in Baltimore and Houston Methodist Hospital, Myszenski pushed to try something new. In July 2015, the hospital implemented a pilot program on a single 12-bed ward that allowed the rehabilitation team to get to patients sooner. By September of the following year, the hospital added 56 more beds to the program, known as the Early Rehab Initiative, allowing physical and occupational therapists to see patients within 12 to 24 hours of them being classified as stable. The effort has continued to spread and has involved more than 11,000 patients. “We’ll be doing over 200 beds by the end of 2019,” Myszenski said. No longer bedridden, patients have thrived, she said. “It has dramatically reduced the number of days they spend on a ventilator,” Myszenski said. “These patients are leaving the hospital sooner. We recognize activity is so much better for their physical and mental state.” For the patients, who come to the hospital suffering from life-threatening conditions including sepsis, respiratory failure or overdose, therapy doesn’t have to be intense.

Well done. Well deserved. Congratulations, Tina Freese Decker on being named one of the 2019 Crain’s Health Care Heroes.

Adele Myszenski

“Some patients may be working on orienting — we show them pictures of their family,” Myszenski said. “Some are ready to sit up in chairs, and some are even up walking.” And the 40 therapists who participate in the Detroit location’s program target the mind as well as the body. “If they’re in pain and we distract them with something they like to do, it will motivate them to get back (to activity),” Myszenski said. The team tries to individualize the treatments. A golf enthusiast’s therpay could include watching the Golf Channel, while animal lovers sometimes get time with therapy dogs. Despite requiring additional therapist time, the program saves the hospital an estimated $408 per patient, adding up to $1.3 million over the course of a year, Myszenski said. “A lot of that savings came in reducing the amount of time a patient needed to be on a ventilator,” she said. Henry Ford, which continues to roll the program out to its community hospitals, hopes to share it with competitors, Myszenski said. Today, it is not standard practice in the industry. “We’re planning on publishing our results, because this is the right thing to do,” she said.

Tina Freese Decker President & CEO, Spectrum Health

Spectrum Health is proud to have a leader like you who is fostering a culture grounded in compassion, collaboration, curiosity and courage.

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SPECIAL REPORT: HEALTH CARE HEROES

ALLIED HEALTH

Kathleen Grobbel

Child Life Supervisor, Beaumont Health By Jay Greene jgreene@crain.com

Each night in December, several dozen children and their families look down into the dark winter night from windows in patient rooms at Beaumont Children’s Hospital in Royal Oak and wait for the moment they have been waiting for all day: the moment when more than a thousand flashlights flicker on from the parking lot below. Dubbed “Moonbeams for Sweet Dreams,” the event has become a symbol of hope and a message of togetherness for everyone who participates. At least that is what Kathleen Grobbel hopes for. The event began on Dec. 1, 2017,

when 50 people showed up to shine their flashlights. On Dec. 31, 2018, more than 1,100 people came together. Hundreds of children and their families stuck in the hospital during the holiday season have experienced the 30-minute emotional surge over the program’s two years. “The hospital has been great about this. People thought we were crazy in the beginning,” said Grobbel, who has worked at Beaumont for nearly 30 years and created the hospital’s Child Life program. It now has 10 employees and staff working with patients in multiple departments. For example, child life specialists work with children to create non-pharmacological pain manage-

ment plans. “We can teach them imagery, deep breathing and other skills to help them cope with pain. It has become a big part of what we do,” she said. But Moonbeams, which was inspired by a similar program at Hasbro Children’s Hospital in Providence, R.I., was a project on an entirely different scale. “We didn’t understand how much help from other departments would be needed once people started coming. We needed to park all those cars, hundreds of cars, in a half hour. We needed the sidewalks clear if it snowed,” Grobbel said. “Then employees started donating flashlights for kids. We had security, but also po-

Kathleen Grobbel

lice departments and fire departments come in. Employees volunteered to park cars.” Grobbel, who is there most every Moonbeams night, said it is a long month for employees, “but it is amazing” for patients, their families and the community. As a two-time cancer survivor, Grobbel also understands the importance of family support when a child battles a life-threatening disease. Her career working with children and families has helped them build resilience during their most difficult times. However, her strongest experience in the hospital was when her mother died from Non-Hodgkin lymphoma in 2011. “She would have loved looking out her window at Moonbeams. It would have touched her heart deeply,” said Grobbel.

ALLIED HEALTH

Danielle Bastien

Registered Nurse, Henry Ford Hospital Emergency Department, Henry Ford Health System By Jay Greene jgreene@crain.com

Danielle Bastien, an emergency nurse with Henry Ford Health System in Detroit, sometimes gets down when she thinks of all the work that needs to be done to turn around the lives of peo-

ple who have been victims of human trafficking. As part of her doctorate studies in nursing at Wayne State University, Bastien said she began researching ways to help medical staff identify patients coming into the ERs who were traffick-

Immigration Commercial Healthcare

ing victims. In January 2017, state regulations went into effect that mandated all licensed health professionals, including doctors, nurses and therapists, complete training to identify victims. About the same time, Henry Ford asked her to create a protocol to help staff identify victims of human trafficking, and later to help develop a hospital policy and procedure, Bastien said. “I didn’t know much about trafficking when I started. I first became interested in violence against women and children and then I learned about human trafficking,” she said. Human trafficking, which includes sex and labor trafficking, is a worldwide, multibillion-dollar global industry that is considered modern-day slavery. Every day, men, women and children are forced into prostitution, domestic servitude and other labor for little or no pay. Most likely because of the state’s proximity to the Canadian border, Michigan has the sixth-highest num-

Danielle Bastien

ber of reported human trafficking cases among all states, according to data from the National Human Trafficking Hotline. From Dec. 6, 2017, to the end of February, Henry Ford staff have confirmed 18 victims, including four minors, of human trafficking, Bastien said. The four minors were placed in safe housing. The two adults who accepted help

were given resources, she said. “The rest went back to the traffickers,” Bastien said. “For the adult victim ... it is not mandatory report. The idea is to empower the victim to seek help.” If an adult is found to be a victim of human trafficking and agrees to receive help, the patient is connected with a Henry Ford social worker, who will further assess the victim and report to external agencies such as the National Human Trafficking Hotline, which can make arrangements for clothing, shelter, transportation. They may also contact local authorities. During triage, nurses or doctors first look for outward signs that include suspicious bruises, injuries or other signs of abuse. Other clues can come in the form of fear or submissive behavior. If those red flags are present, the patient’s primary nurse will continue the assessment with specific questions. Once the identification protocol was in place, it led to a formal training and hospital policy for all ER doctors and nurses at Henry Ford. Over the past 16 months, Bastien said she has trained nearly 1,000 doctors, nurses, physical and occupational therapists and other staff within the Henry Ford system in how to identify trafficking victims.

President and CEO, Spectrum Health

And so many more... visit us at kitch.com

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ADMINISTRATOR

Tina Freese Decker Employment & Labor

By Jay Greene jgreene@crain.com

In 2002, Spectrum Health was a five-hospital system based in Grand Rapids with 9,000 employees. Tina Freese Decker was an administrative fellow from the University of Iowa’s health administration program. She chose Spectrum for her fellowshipbecause she liked the culture, wanted to work in an urban setting and sensed her future and the best possible outcomes for patients lay in integrated health care systems that feature an employed medical group, health plan and a hospital network that reaches across diverse communities. Some 17 years and several promotions later, Freese Decker is president and CEO of Spectrum. And Spectrum has grown to a $6.1 billion system

with 14 hospitals, 30,000 employees, a 1,400-member medical group and an 800,000-member health plan, Priority Health. Freese Decker, who was named CEO in 2018 over about 20 other candidates after a national search, said one of her overarching philosophies is to focus on collaborative projects and encourage transparency. “My second day in my role as CEO, I removed the door in the executive suite” to send employees a message that barriers to communication needed to be eliminated, she said. Freese Decker acknowledged the door probably was there to reduce sound in the executive offices. “It is noisier now. But let’s have a conversation about noise,” she joked. After her fellowship, Freese Decker spent the next eight years working in

Tina Freese Decker

various strategic planning roles. In 2011, she became president of Spectrum United and Kelsey Hospitals; she was hospital group president from 2014 to 2017; then she became COO, which included oversight of

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C R A I N â&#x20AC;&#x2122; S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

SPECIAL REPORT: HEALTH CARE HEROES ALLIED HEALTH

Philip Muccio

President and Founder, AxioBionics By Doug Henze

Special to Crainâ&#x20AC;&#x2122;s Detroit Business

Born with club feet, AxioBionics President Philip Muccio got an early introduction to the world of health care. â&#x20AC;&#x153;I was really impressed with the medical field and how they helped you with your problem,â&#x20AC;? recalls Muccio, who, as a child, endured several surgeries to realign his feet and then healing periods in a full cast. â&#x20AC;&#x153;I wanted to be part of it. I think that early exposure to the medical field built compassion (in) me.â&#x20AC;? That and a propensity for tinkering motivated him to found his Ann Arbor company, which produces wearable, therapeutic gear. Using electrical stimulation, the gear is aimed at pain relief or, for paralysis victims, muscle stimulation. After completing a residency at the Cleveland Clinic, Muccio got involved in research at the Cleveland Veterans Administration Hospital, where researchers were implanting wires in the muscles of paralyzed people to get them to stand and walk. Muccio also worked with Ohio State on electrical stimulation research. In 1993, Muccio formed his company in Columbus, Ohio, and two years later got clearance from the U.S. Food and Drug Administration to begin selling products. Then, Muccio was contacted by the rehabilitation team for a famous customer. â&#x20AC;&#x153;I got asked to make one of my suits for Christopher Reeve,â&#x20AC;? Muccio said. â&#x20AC;&#x153;He was one of my first clients.â&#x20AC;? The actor best known for playing Superman suffered a severe spinal cord injury, resulting in paralysis, in a horseback riding accident. â&#x20AC;&#x153;His spinal cord injury was as complete as it gets,â&#x20AC;? Muccio said. â&#x20AC;&#x153;The rehab team wanted him to have a suit that would keep his body in good health and good shape. It gave me affirmation I was fulfilling a need.â&#x20AC;? Reeveâ&#x20AC;&#x2122;s device couldnâ&#x20AC;&#x2122;t give him body function, but it helped limit muscle atrophy and improve circulation. Since helping Reeve, Muccio esti-

the systemâ&#x20AC;&#x2122;s hospitals and medical group. In her many roles at Spectrum, Freese Decker has been involved in countless projects. In 2017, Spectrum and Priority Health developed a home-based primary care program to help seniors stay longer in their homes and keep them out of expensive emergency departments. Over the last two years, Priority Health has saved $9,000 per person, or 40 percent of annual care costs, by identifying patients who are most likely to be admitted and then making sure they receive case management services. Last year, Spectrum Healthâ&#x20AC;&#x2122;s Comprehensive Stroke Center, one of the largest in the state, exceeded national standards in eight of nine categories, including attaining 93 percent in the critical â&#x20AC;&#x153;door-to-needle time of less than 60 minutesâ&#x20AC;? category. The national average is about 66 percent. But one of Freese Deckerâ&#x20AC;&#x2122;s proudest accomplishments has been the effort to reduce infant mortality rates

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Philip Muccio

mates his 10-employee company has produced about 10,000 â&#x20AC;&#x153;suits,â&#x20AC;? which consist of sleeves for an arm or a leg, for example. AxioBionics doesnâ&#x20AC;&#x2122;t make full-body devices, which are considered too difficult to put on to be practical. Clients, who may own multiple devices, include people with strokes and cerebral palsy. â&#x20AC;&#x153;I also learned, eventually, that electrical stimulation was good for chronic pain,â&#x20AC;? Muccio said. While paralysis patients wear the devices four to 12 hours a day, pain sufferers sometimes sleep in them, he said. When patients wear the devices outside of the home, they can be concealed under clothing. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s therapy behind the scenes,â&#x20AC;? said Muccio. The suits arenâ&#x20AC;&#x2122;t inexpensive â&#x20AC;&#x201D; ranging from $1,000 to $20,000. Michiganâ&#x20AC;&#x2122;s insurance laws, which provide lifetime benefits for traffic accident victims, encouraged Muccio to move his company here in 2010. But they also represent a fixed cost, compared with therapy hours, Muccio said. â&#x20AC;&#x153;Youâ&#x20AC;&#x2122;re wearing your therapy,â&#x20AC;? he said. â&#x20AC;&#x153;You can undergo thousands of hours of therapy a year, and thatâ&#x20AC;&#x2122;s what the body is in need of.â&#x20AC;?

in Kent Countyâ&#x20AC;&#x2122;s African American population. Over the past decade, Spectrumâ&#x20AC;&#x2122;s Strong Beginnings partnership has helped to cut infant mortality by 28 percent with more than 4,000 families served. The partnership includes Spectrum, the Kent County Health Department, Cherry Health and Metro Health Community Clinic. â&#x20AC;&#x153;I am most proud of the work the collaborative has done working with seven or eight organizations in the communities,â&#x20AC;? she said. â&#x20AC;&#x153;We have eliminated disparities and now our focus is to get more people enrolled in the program.â&#x20AC;? In the future, Freese Decker hinted that her knack for challenging the status quo may lead to changes. â&#x20AC;&#x153;As an integrated health system, we have to focus on care and coverage, value and affordability. It is so important now,â&#x20AC;? she said. â&#x20AC;&#x153;We must show our value to employers and focus on this over the next few years. This is what our consumers want.â&#x20AC;?

salutes our CEO Ewa Matuszewski and all of the 2019 Health Care Heroes =ou |_;bu v_-u;7 r-ŕŚ&#x17E;;m|Ĺ&#x160;Cuv| r-vvbomÄˇ leadership and impact on health care in our community For more information about MedNetOne Health Solutions and our provider services, contact CEO Â&#x2030;- -|Â&#x2020;vÂ&#x152;;Â&#x2030;vhb at ;l-|Â&#x2020;vÂ&#x152;;Â&#x2030;vhbĹ l;7m;|om;Äşm;| Ć&#x2018;Ć&#x201C;ŃśÄşĆ&#x201C;Ć&#x2022;Ć&#x201D;ÄşĆ&#x201C;Ć&#x2022;Ć?Ć?

M E D N E T O N E . N E T

INNOVATION IN RESEARCH

CONGRATULATIONS TO OUR

HEALTH CARE HERO

Thomas Forbes, MD

Pediatric Cardiologist Director, Cardiac Catheterization Laboratory Childrenâ&#x20AC;&#x2122;s Hospital of Michigan

ChildrensDMC.org Follow Us: @ChildrensDMC

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

SPECIAL REPORT: HEALTH CARE HEROES CORPORATE ACHIEVEMENT

Lenora Hardy-Foster CEO and President, Judson Center By Jay Greene jgreene@crain.com

Lenora Hardy-Foster has brought a passion for service and more than 40 years of nonprofit experience to the Judson Center, a multi-purpose organization that focuses on helping people with behavioral health problems, autism treatment, disabilities, foster care and adoption. Originally from Selma, Ala., Hardy-Foster moved to metro Detroit in 1978 to live with relatives and finish high school. She graduated from the University of Detroit Mercy in 1988 with a business degree, then earned her MBA there in 1996. Last summer, she also studied at the Harvard Business School Strategic Perspectives for Non-Profit Management. While studying at Detroit Mercy, she planned to be an accountant, with a dreams of working at Ford Motor Co.’s corporate headquarters. But after undergraduate studies she took a job as accounts manager at Southwest Community Mental Health Services, which later became Southwest Solutions, and fell in love with the nonprofit world. “I learned about being a service provider, touching people’s lives. I wanted to do that as my career,” she said. After multiple promotions through the accounting and finance departments, she eventually became executive director in 2000 under longtime CEO John Van Camp, who retired in 2018.

“I learned a lot from John. He was one of the greatest visionary leaders I have ever met. He knows how to think about where you are today but where you need to be in five years,” Hardy-Foster said. “The other thing he knew was how to surround himself with talent. ... With line staff, we had turnover as they had other opportunities. But there was very little turnover at the executive level.” Founded in 1924 by Baptist ministers, the Judson Center has four core programs it offers the community. The largest is its foster care, adoption and family reunification program, which accounts for 51 percent of its $26 million budget. It also has been expanding its behavioral health services and autism services, accounting for 26 percent and 15 percent of budget, respectively. Disability and vocational services account for about 10 percent of budget. Hardy-Foster doesn’t have a favorite service, but Judson’s Autism Connections program has grown the fastest in the past several years as Michigan in 2012 mandated insurance coverage for autism services and began to expand counseling for individuals diagnosed with autism spectrum disorder. Judson expects to serve at least 331 children this year for autism services, up from 245 in 2018 and 235 in 2017. Judson’s comprehensive approach includes family counseling, parent training, occupational therapy and

Lenora Hardy-Foster

speech services. In 2018, Judson introduced “Bridges to Success,” a non-residential program on the Royal Oak campus using ABA therapy to help teens with autism develop relationship, independent living and pre-vocational skills to prepare them for adulthood. “We are very excited about this program that uses ABA therapy to work with teens with autism and prepare them for what happens when they turn 18 or 19,” Hardy-Foster said. “They are getting to that age where they might live independently. Do they have the skills to move forward?” In a home-like setting, teachers show teens how to master laundry, cooking, grocery shopping and money management. But with 14 participants,

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CORPORATE ACHIEVEMENT

Richard Boothman

Owner and Principal, Boothman Consulting Group By Jay Greene CONNECTION TO

COM M U N IT Y We travel your roads and live on your streets so we know well what is important to your community. Local knowledge and personal understanding – it’s all connected.

FISHBECK , THOMPSON, CARR & HUBER engineers | scientists | architects | constructors

jgreene@crain.com

Richard Boothman has helped to change what happens when medical mistakes are made in Michigan — and across the country. As assistant general counsel and chief risk officer at the University of Michigan Health System in the early 2000s, he wanted to stop what he believed was a counterproductive “deny and defend” culture at health care institutions when a patient is injured by medical malpractice or suffers a bad outcome. As an experienced defense attorney, Boothman knew medical errors kill tens of thousands of patients each year and many others suffer injury. He also knew that not all bad outcomes are the fault of doctors and nurses. But the culture at the time — and even today at many hospitals — is to deny when bad things happen and not tell patients or families when a mistake is made. People deny that they have made mistakes mostly out of fear of being sued, punished internally or ostracized by peers. Shortly after joining UM, Boothman introduced what has become known as the “Michigan Model” for handling medical errors — formally called the Early Disclosure and Offer Program — and communicating with patients quickly after a bad outcome. After an immediate quality analysis, the hospital makes a good faith effort to compensate the patient to avoid

costly litigation. Since the program began, the average rate of medical malpractice lawsuits against UM providers has been cut in half to 0.75 per 100,000 patient encounters from 2.13, according to a 2010 study in the Annals of Internal Medicine. New claims each month decreased to 4.52 from 7.03 per 100,000 patient encounters. Claim resolution time also has declined to less than 12 months from nearly 18 months. The average cost per lawsuit decreased to $228,308 from $405,921. Since that 2010 study was published, Boothman said claims levels and numbers have continued to decline. “The dire predictions by the skeptics, some of whom were certain that we would bankrupt the university within five years, have been proved incorrect,” he said. Boothman says he wasn’t the only person at UM to ensure what has also been called the “I’m Sorry” program became ingrained in the culture at the university. He credited Darrell “Skip” Campbell, M.D., a surgeon and the medical school’s former chief medical officer, for his partnership and understanding. He also noted that in 1999 two researchers at a VA hospital in Lexington, Va., published a paper that discussed the potential benefits of being honest about medical malpractice. “The approach (at UM) also immediately resonated with caregivers. They have an intimate relationship with patients and wanted to see this

Richard Boothman

happen, but they were being told by lawyers and insurance people not to” because it was believed more, not fewer, lawsuits would be filed, Boothman said. In 2009, the U.S. Agency for Healthcare Research and Quality conducted a $23 million study and tested the approach at 14 hospitals. The result was the Communication and Optimal Resolution, or Candor, which is similar to UM’s approach for saving money on malpractice litigation while encouraging more robust scrutiny of what went wrong. If that happens, the patient and family are notified of the mistake or poor outcome as soon as possible. A medical-quality review team investigates, and a plan is developed to prevent similar future events. If there was a medical mistake, an

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

SPECIAL REPORT: HEALTH CARE HEROES ADMINISTRATOR many of whom need regular treatment, the program has a waiting list. Judson’s disability support services help dozens of people who are disabled and are seeking employment. “They could stay at home, but to achieve their lifelong dream, we work with those individuals and negotiate with employers, grocery stores, hotels, to give them a chance,” she said. Hardy-Foster is also leading Judson’s efforts to solve a supply-and-demand problem in the foster care system. In Michigan, more than 13,000 children are part of the state’s foster care program, with 3,000 on the waiting list to be adopted. “The biggest challenge we face is recruiting foster care parents,” she said. “Children want to feel loved, and we are always trying to expand the number of parents.” One of Hardy-Foster’s largest recent projects is a partnership with MedNetOne, a Rochester-based physician organization headed up by Ewa Matuszewski (also a 2019 Health Care Hero). Their goal: Create a coordinated care clinic that serves both body and mind. In March, they opened the Judson Center Family Health Clinic in Warren, a one-stop clinic with primary care provided by MedNetOne and behavioral health services by Judson. Hardy-Foster said volume has been slow in the first month, but the clinic already has seen 35 people, mostly to receive primary care. “We are starting to see some additional volume. It will come once the word gets out,” she said. “We are very excited about the possibilities.”

apology is issued to the patient or family. Compensation or settlement is offered if the error caused an injury or resulted in lost work time. “We put caregivers front and center. We don’t wait for a claim. We get right to the bedside and look at it very critically,” Boothman said. But UM has moved beyond simply reporting possible medical malpractice incidents. It is also creating a process to prevent mistakes in the first place. “We are reducing mistakes before they happen. This was only accomplished by creating a non-defensive environment. We moved from having a punitive culture, where people were afraid to speak out, to a culture of patient safety,” Boothman said. Despite the University of Michigan since 2001 more than doubling its clinical activity, the number of malpractice claims has fallen. Last August, Boothman retired from UM after realizing the program he helped to start “was deeply embedded in the caregiver culture at Michigan.” Now Boothman is owner and principal of Boothman Consulting Group LLC in Ann Arbor. He remains adjunct assistant professor at the University of Michigan Medical School’s department of surgery. He is also visiting scholar at Vanderbilt University Medical School’s Center for Patient and Professional Advocacy. He travels around the United States and the world explaining the risk management process and encourages hospitals and doctors to integrate it with existing patient and employee safety programs.

Ewa Matuszewski

CEO and Co-Founder, MedNetOne By Jay Greene jgreene@crain.com

Ewa Matuszewski has been an advocate for integrated medical and behavioral health care long before it was popular and a proponent of patient-centered medical homes before payers started rewarding primary care groups for managing patients’ continuum of care. As CEO and co-founder of Rochester-based MedNetOne Health Solutions, Matuszewski helped physicians navigate the murky early days of managed care contracting since the early 1980s. Then, starting in the late 1990s, Matuszewski and medical leaders in MedNetOne encouraged physicians to analyze health care claims for their practices, and they began to see patients needed more attention and care management programs to treat chronic illnesses such as obesity or diabetes. “We transformed from helping with contracting with payers to supporting the needs of patients and physicians in practice,” Matuszewski said. Over the years, MedNetOne has grown to 60 employees and more than 1,100 providers, including more than 200 nonphysicians, serving 150,000 patients in 208 active practices. MedNetOne was one of the first physician organizations to recruit and accept non-physician members, including behavioral health and population health specialists, chiropractors, psychologists and a variety of advanced practice nurses. “We have to include other types of doctors and health care professionals” to provide comprehensive care, Matuszewski said. Like many physician organizations, MedNetOne is focusing on ways to keep its patient populations healthy. More than 30 of its primary care medical groups are designated patient-centered medical homes, which means they coordinate care with specialty providers and act as a general health coach to patients. Many are also taking steps to improve population health, or managing the health outcomes of a group of people. While Matuszewski has long advocated for population health through co-location of health care services, MedNetOne in February took a major step in the behavioral health area by opening a primary care clinic at one of the Judson Center’s behavioral health clinics in Warren. The 3,000-square-foot Judson Center Family Health Clinic at the Judson health center is staffed by MedNetOne employees, including a physician, a mid-level provider, dietitian, exercise specialist and community health worker and is open six days a week. Earlier this year, Judson received $669,000 in four grants to help open a primary care clinic with MedNetOne. (Judson Center’s President and CEO Lenora Hardy-Foster is also a 2019 Health Care Hero.) Matuszewski said MedNetOne will integrate electronic health records with Judson to ensure a smooth continuum of care with the mental health provider’s other services. Judson annually serves about 1,100 people each year in Warren. MedNetOne, which has signed a two-year evergreen contract with Judson, will ac-

Ewa Matuszewski

cept Medicaid, Medicare and other health insurance policies. “We are looking forward to establishing more relationships with community mental health agencies because there is a disconnect for working with them by providers,” she said. “They don’t share information and have no idea if a patient is treated at one place or another. Data needs to be shared.” Starting last year, MedNetOne-affiliated clinics have asked patients to sign agreements with the practices to allow physical and behavioral health providers to share health information. That’s in addition to the collaborative care agreement that patients sign to participate in a medical clinic’s patient-centered medical home. Still, payer policies need to be ex-

EMPOWERING, E P PASSIONATE, I INNOVATIVE L LEADER. Karmanos Cancer Institute congratulates Elisabeth I. Heath, M.D., FACP, for being recognized among Crain’s 2019 Health Care Heroes. We’re honored to have Dr. Heath among our exceptional team of cancer experts. A compassionate physician, a driven researcher and a trailblazer who engages survivors to help direct the future of cancer research. To us, you’ll always be a hero.

panded to encourage more care coordination between physicians and other health specialists, Matuszewski said. Matuszewski also is the founding principal of Practice Transformation Institute, which delivers continuing education programs for the health care community and has trained over 500 patient care managers. “Payers are starting to recognize the need for using medical assistants and community health workers” to follow up with patients to ensure compliance with care instructions, she said. In March, Blue Cross Blue Shield of Michigan began paying for phone calls to patients to check up on their health status, Matuszewski said. “This is really new and is going to change the dynamics of how we monitor for vulnerable populations,” she said.

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

CRAIN'S LIST: LARGEST MICHIGAN PHYSICIAN ORGANIZATIONS

Ranked by number of physicians Company Address Rank Phone; website

1 2 3 4 5 6 7 8 9 10 11 12 13

Top executive(s)

Physicians Jan. 2019/ 2018

Full-time employed physicians Jan. 2019/ 2018

Part-time employed physicians Jan. 2019/ Type of 2018 organization Physician hospital affiliations

Beaumont Care Partners LLC 26901 Beaumont Blvd., Southfield 48033 (947) 522-0039; www.beaumontcarepartners.org

Ryan Catignani, interim executive director; David Walters, interim CMO

3,921 3,892

0 NA

CIN

Beaumont Dearborn, Beaumont Farmington Hills, Beaumont Grosse Pointe, Beaumont Royal Oak, Beaumont Taylor, Beaumont Trenton, Beaumont Troy, Beaumont Wayne

Trinity Health ACO 20555 Victor Parkway, Livonia 48152 (734) 343-1000; www.trinityhealthaco.org

Emily Brower, SVP, integrated clinical and physician services; Daniel Roth, EVP Michael Williams, president and CEO; Diane Slon, EVP, COO

2,882 2,654

1,444 1,093

NA NA

ACO

Mercy Health, Muskegon; Mercy Health, Lakeshore Campus; Mercy Health Saint Mary's

2,629 2,472

NA NA

IPA

McLaren Physician Partners 2701 Cambridge Court, Suite 200, Auburn Hills 48326 (248) 484-4928; www.McLarenpp.org

Gary Wentzloff president and CEO

2,351 2,275

850 719

0 0

PHO

Beaumont Health, Beaumont Health Farmington Hills, Children's Hospital of Michigan, Crittenton Hospital and affiliates, Detroit Medical Center hospitals, Pontiac General Hospital, Garden City Hospital, Henry Ford Health System, Karmanos Cancer Center, McLaren Health Care Corp., Oakland Regional Hospitals, Select Specialty Hospitals, St. John Providence Health System, St. Joseph Mercy Health System, St. Mary Mercy Hospital of Livonia, Triumph Hospital of Detroit, UM Hospital, others McLaren Health Care Corp., Karmanos Cancer Center

The Physician Alliance LLC 20952 12 Mile Road, Suite 130, St. Clair Shores 48081 (586) 498-3555; www.thephysicianalliance.org

Michael Madden president and CEO

2,279 2,293

563 421

0 0

IPA

2,102 1,933

0 0

Group practice

1,901 1,944

1,302 1,312

0 0

CIN

Henry Ford Health System, others. Includes 1,302 employed physicians in the Henry Ford Medical Group.

1,700 NA

NA NA

CIN

Saint Joseph Mercy Health System

1,216 1,084

0 0

ACO

Beaumont hospitals in Royal Oak, Dearborn, Farmington Hills, Grosse Pointe, Taylor, Trenton and Wayne

1,061 959

0 NA

CIN

Mercy Health Saint Mary's, Mercy Health Hackley, Mercy Health Muskegon, Mercy Health Lakeshore

1,055 990

NA NA

Group practice

St. Joseph Mercy Ann Arbor, St. Joseph Mercy Livingston, St. Joseph Mercy Chelsea, St. Joseph Mercy Oakland, St. Mary Mercy Livonia, Mercy Health Muskegon, Mercy Health - Lakeshore Campus, Mercy Health Saint Mary's

985 1,095

0 0

IPA

925 915

NA NA

Group practice

United Physicians Inc. 30600 Telegraph Road, Suite 4000, Bingham Farms 48025 (248) 593-0100; www.updoctors.com

Timothy Johnson, senior University of Michigan Faculty Group Practice associate dean for clinical 4101 Medical Science Building I, Ann Arbor affairs 48109-0624 (800) 211-8181; medicine.umich.edu/medschool/ patient-care/u-m-medical-group Bruce Muma, CMO and Henry Ford Physician Network interim president and 1 Ford Place, Detroit 48202 (313) 874-1466; henryfordphysiciannetwork.com CEO Paul Harkaway, chief SE Clinical Network LLC accountable care officer; 5333 McAuley Drive, Suite 4005, Ypsilanti 48197 Michelle Ilitch, executive director Walter Lorang, executive Beaumont Accountable Care Organization director and COO 26901 Beaumont Blvd., Southfield 48033 (947) 522-0037; www.beaumont-aco.org David Van Winkle, Affinia Health Network CIN executive medical 1675 Leahy St., #200B, Muskegon 49442 director; Shaun Raleigh, (231) 672-3882; www.affiniahealth.com executive director Daniel Roth, EVP, chief Trinity Health Medical Groups and Provider clinical officer Services B 20555 Victory Parkway, Livonia 48152 (734) 343-1000 Ewa Matuszewski MedNetOne Health Solutions CEO 4986 N. Adams Road, Suite D, Rochester 48306-1416 (248) 475-4701; www.mednetone.com Daniel Frattarelli Beaumont Medical Group president 26901 Beaumont Blvd., Southfield 48033

Ascension St. John Hospital, Ascension Providence Hospital, Ascension Providence Park Hospital, Ascension Macomb-Oakland Hospital, Ascension River District Hospital, Children's Hospital of Michigan, Detroit Receiving Hospital, Beaumont Health, Henry Ford Health System, McLaren-Macomb, Harper Hospital, Karmanos Cancer Institute, Ascension Providence Rochester Hospital Michigan Medicine (formerly University of Michigan Health System)

Ascension Providence Rochester, Henry Ford Health System, Beaumont Health, Mercy Memorial Monroe, McLaren Health System, St. John Providence Health System, Detroit Medical Center Beaumont Dearborn, Beaumont Farmington Hills, Beaumont Grosse Pointe, Beaumont Royal Oak, Beaumont Taylor, Beaumont Trenton, Beaumont Troy, Beaumont Wayne Henry Ford Main, Henry Ford Wyandotte, and hospitals designated by health plans with which UOP physicians are contracted

United Outstanding Physicians LLC 18800 Hubbard Drive, Suite 200, Dearborn 48126 (313) 240-9867; www.uopdocs.com

Yasser Hammoud medical director and CEO

921 926

0 0

IPA

McAuley Health Partners ACO LLC

Michelle Ilitch, executive director; Martha Walsh, regional director

893 NA

462 NA

NA NA

ACO

Saint Joseph Mercy Ann Arbor, Saint Joseph Mercy Chelsea, Saint Joseph Mercy Livingston

Paul MacLellan CEO

800 900

100 100

0 0

IPA

Statewide hospital affiliations

Consortium of Independent Physician Associations (CIPA) 101 North Main Street, Ann Arbor 48104 (800) 594-6115; www.medicaladvantagegroup.com

Jacqueline Rosenblatt executive director

659 639

254 211

0 52

IPA

Henry Ford Macomb Hospital-Clinton Township

GMP Network 43411 Garfield Road, Suite A, Clinton Township 48038 (586) 842-0870; www.gmpnetwork.org

Jerome Frankel medical director

658 681

NA NA

IPA

Oakland Southfield Physicians PC 29200 Northwestern Highway, Suite 325, Southfield 48034 (248) 357-4048; www.ospdocs.com

Beaumont Dearborn, Beaumont Farmington Hills, Beaumont Trenton, Children's Hospital of Michigan, Henry Ford Health System, Huron Valley-Sinai Hospital, McLaren Oakland, Sinai-Grace Hospital, St. John Providence Health System, St. Joseph Mercy Health System, St. Mary Mercy Hospital Livonia

IHA Health Services Corp. C 24 Frank Lloyd Wright Drive, Lobby J2000, Ann Arbor 48105 (734) 747-6766; www.ihacares.com

Mark LePage, MD CEO

503 503

467 432

36 71

Group practice

Olympia Medical LLC

Randall Bickle president and CEO

500 500

95 85

10 10

IPA

Frank Lloyd Wright Drive Lobby J, Ann Arbor 15 24 48105

Five Mile Road, Suite 210, Livonia 48154 20 33300 (313) 357-1215; www.olympiadocs.com

St. Joseph Mercy Health System, Michigan Medicine

Beaumont Farmington Hills, Garden City, St. Mary Mercy Livonia, Providence Park, St. Joseph-Ann Arbor

Want the full Excel version of this list Ñ and every Crain's list? Become a Data Member: CrainsDetroit.com/data This list of physician organizations encompasses physician hospital organizations and independent practice associations and is an approximate compilation of the largest such groups in Michigan. IPA = Independent practice association. PHO = Physician hospital organization. ACO = Accountable care organization. CIN = Clinically integrated network that includes physicians, hospitals other providers. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the organizations. NA = not available.

B Trinity Health employed physicians in state of Michigan Ñ includes IHA, providers employed by St. Joseph Mercy Health and providers employed by Mercy Health. C IHA is a partner of St. Joseph Mercy Health System and a member of Trinity Health. LIST RESEARCHED BY Gerald Schifman

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

CRAIN'S LIST: LARGEST MICHIGAN HOSPITAL COMPANIES

Ranked by 2018 net patient revenue Rank

Company Address Phone; website

Top executive(s)

LicensedNet patient Uncompensated bed revenue care capacity/ $000,000) ($000,000) occupancy 2018/2017 2018

Number of employed physicians Jan. 2019

Full-time equivalent Number of Michigan hospital/ employees ambulatory Jan. 2019 facilities Major facilities

Beaumont Health 2000 Town Center, Suite 1200, Southfield 48075 (248) 213-3333; www.beaumont.org

John Fox president and CEO

$4,425.1 $4,173.9

$51.2

3,429 68.3%

941

27,587

8 145

Beaumont hospitals in Dearborn, Farmington Hills, Grosse Pointe, Royal Oak, Taylor, Trenton, Troy and Wayne

Ascension Michigan 28000 Dequindre Road, Warren 48092 www.ascension.org/michigan

Joseph Cacchione, ministry market executive

3,760.8 B 3,615.2

0.0

NA NA

21,190

NA NA

Henry Ford Health System 1 Ford Place, Detroit 48202 (800) 436-7936; www.henryford.com

Wright Lassiter III president and CEO

3,581.7 3,275.0

125.8 C

2,495 NA

26,079

NA NA

St. John Hospital & Medical Center, Providence and Providence Park Hospital, St. John MacombOakland Hospital, St. John River District Hospital, Brighton Center for Recovery, Borgess Medical Center, Borgess-Pipp Hospital, Borgess-Lee Memorial Hospital, Genesys Regional Medical Center, St. MaryÕs of Michigan, St. MaryÕs of Michigan Standish and St. Joseph Health System, Crittenton Hospital Medical Center Henry Ford Hospital and its campuses: Macomb, West Bloomfield Township, Wyandotte and Kingswood and Henry Ford Allegiance

Trinity Health 20555 Victor Parkway, Livonia 48152 (734) 343-1000; www.trinity-health.org

Richard Gilfillan D, CEO

3,361.1 3,250.7 E

54.9

2,289 61.0

24,304

8 NA

Michigan Medicine (formerly University of Michigan Health System) 1500 E. Medical Center Drive, Ann Arbor 48109 (734) 936-4000; www.med.umich.edu

Marschall Runge EVP for medical affairs

3,267.5 3,070.0

112.9

1,043 83.0

17,468

1 40

McLaren Health Care Corp. One McLaren Parkway, Grand Blanc 48439 (810) 342-1100; www.mclaren.org

Philip Incarnati president and CEO

2,791.0 2,777.3 F

131.4

3,189 NA

534

22,613

14 350

Spectrum Health System G 100 Michigan St. NE, Grand Rapids 49503 (616) 391-1774; www.spectrumhealth.org

Tina Freese Decker H president and CEO

2,370.5 2,291.5

74.2

1,884 53.5

969

22,282 I

14 230

Detroit Medical Center 3990 John R, Detroit 48201 (313) 745-5146; www.dmc.org

Anthony Tedeschi group CEO

1,924.0 B 1,850.0 B

0.0

NA NA

9,802

NA NA

Sparrow Health System 1215 E. Michigan Ave., Lansing 48912 (517) 364-1000; www.sparrow.org

Joseph Ruth J, acting president and CEO

1,002.5 988.2

65.2

820 NA

363

6,841

5 80

MidMichigan Health 4611 Campus Ridge Drive, Midland 48640 (989) 839-3000; www.midmichigan.org

Diane PostlerSlattery, president and CEO

806.6 762.4

78.7

721 39.1

335

6,688

6 27

MidMichigan Medical Centers in Alpena, Clare, Gladwin, Gratiot, Midland, Mt. Pleasant and West Branch

Covenant HealthCare 1447 N. Harrison, Saginaw 48602 (989) 583-0000; www.covenanthealthcare.com

Ed Bruff president and CEO

631.3 604.1

0.0

NA NA

205

3,894

NA NA

Covenant HealthCare

Metro Health - University of Michigan Health K 5900 Byron Center Ave. SW, Wyoming 49519 (616) 252-7200; www.metrohealth.net

Peter Hahn president and CEO

401.1 348.0 L

0.0

NA NA

1,976

NA NA

Hurley Medical Center 1 Hurley Plaza, Flint 48503 (810) 262-9000; www.hurleymc.com

Melany Gavulic president and CEO

394.6 414.8

21.0

443 70.8

2,645

1 11

Metro Health Southwest; Rockford; Cascade; Community Clinic; Sports Medicine; Internal Medicine; MidTowne Ambulatory Surgery Center; Metro Health Park East; and The Cancer Center at Metro Health Village Hurley Medical Center

Holland Hospital 602 Michigan Ave., Holland 49423 (616) 392-5141; www.hollandhospital.org

Dale Sowders president and CEO

243.5 233.0

12.4

NA NA

Holland Hospital

Garden City Hospital 6245 Inkster Road, Garden City 48135 (734) 458-3300; www.gch.org

Saju George CEO

156.6 NA

0.0

167 NA

NA NA

Garden City Hospital, GCH Specialty Centers of Westland

3 4 5 6

8 9

Saint Joseph Mercy Health System and its campuses in Ann Arbor, Chelsea, Oakland and Livonia. Mercy Health and its campuses in Grand Rapids, Muskegon and Shelby. University Hospital, C.S. Mott Children's Hospital, Women's Hospital, UM Cancer Center, UM Cardiovascular Center, UM Depression Center, Kellogg Eye Center Bay Region, Bay Special Care, Central Michigan, Greater Lansing, Orthopedic Hospital, Lapeer Region, Clarkston, Flint, Macomb, Oakland, Northern Michigan, Northern Michigan Cheboygan, Proton Therapy Center, Port Huron, Karmanos Cancer Institute, McLaren Home Care, McLaren Medical Group Spectrum Health hospitals: Butterworth, Blodgett, Reed City, United, Kelsey, Special Care, Gerber Memorial, Zeeland Community, Helen DeVos Children's, Big Rapids, Ludington, Pennock, Lemmen-Holton Cancer Pavilion, Meijer Heart Center, Tamarac Medical Wellness and Fitness Center, Wheatlake Cancer Center. Also Spectrum Health Lakeland Children's Hospital of Michigan, Detroit; Children's Hospital of Michigan, Troy; Detroit Receiving Hospital; Harper University Hospital; Hutzel Women's Hospital; Cardiovascular Institute; Rehabilitation Institute of Michigan; Sinai-Grace Hospital; Huron Valley Sinai Hospital. Sparrow Hospital, Sparrow Carson Hospital, Sparrow Ionia Hospital, Sparrow Clinton Hospital, Sparrow Specialty Hospital

Want the full Excel version of this list Ñ and every Crain's list? Become a Data Member: CrainsDetroit.com/data This listing is an approximate compilation of the leading hospital companies based in Michigan. Net patient revenue listed is operating revenue, excluding bad debt. Uncompensated care is charity care plus bad debt at costs. These are medical services for which no payment is received or expected. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the companies directly or from state and federal filings. Companies with headquarters elsewhere are listed with the address and top executive of their main Michigan office. NA = not available.

B Crain's estimate. C From financial statement ending in Dec. 31, 2018. D To step down in June and will be succeeded by Michael Slubowski on July 1. E Michigan only. F From annual report year ending in September 2017. G Spectrum and Lakeland Health merged Oct. 1. H Succeeded Richard Breon effective Sept. 1. I Figures are FTE counts. J Succeeded E.W. Tibbs who was put on paid leave on March 13, pending further investigation by the board for harassment while he was an official at a Virginia hospital system. K Merged with University of Michigan Health System in 2016. Under the merger, Metro Health became a subsidiary of University of Michigan System. L Net patient revenue for 2016 and 2017 is from Medicare report ending in June 30, 2015 and June 30, 2016. LIST RESEARCHED BY SONYA D. HILL

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

MACKINAC POLICY CONFERENCE

TAKE YOUR HARDWARE TO MARKET Learn from Michigan startups about how a product or technology gets noticed — and ultimately purchased — by companies with a nationwide footprint.

FREE WEBINAR for entrepreneurs

NOON – 1PM • Wednesday, June 12 Featuring live Q&A with panelists Register today at crainsdetroit.com/MEDCtechwebinar

PANELISTS

DETROIT RIVERFRONT CONSERVANCY

Delta Dental of Michigan is donating $5 million toward construction of a five-acre children’s play garden in the planned 22-acre Ralph C. Wilson, Jr. Centennial Park on Detroit’s West Riverfront. The donation will be Delta Dental’s largest corporate gift ever.

Chris Chance Aerotronic SPONSORED BY

Charlie Tyson MEDC

Shadi Mere Bedestrian POWERED BY

Delta Dental donates $5M to playground at new riverfront park By Chad Livengood clivengood@crain.com

Delta Dental of Michigan is donating $5 million toward construction of a 5-acre playground along Detroit’s west riverfront in the Ralph C. Wilson Jr. Centennial Park, where construction is scheduled to begin next year. The Delta Dental Play Garden “is going to be a game-changer for the families in Detroit and for folks who live in this region,” said Mark Wallace, president and CEO of the Detroit Riverfront Conservancy. Goran Jurkovic, CEO of Delta Dental of Michigan, said the donation will be the largest in the dental-benefits management company’s 62-year history. “It will activate that area and hopefully bring a lot of kids to the riverfront,” Jurkovic said in an interview at the Detroit Regional Chamber’s Mackinac Policy Conference. New York City landscape architect Michael Van Valkenburgh and his firm Michael Van Valkenburgh Associates will design the play garden. Van Valkenburgh’s previous major park projects include Gathering Place in Tulsa, Brooklyn Bridge Park in New York City and Maggie Daley Park in Chicago along Lake Michigan. Van Valkenburgh is bringing in Copenhagen-based design firm Monstrom, which will design an “enormous” 20-foot brown bear structure in the park for kids to play in, Wallace said. “This play garden is going to be designed with the best understanding of childhood development and our best understanding of landscape architecture,” Wallace said. “We would expect this play garden is going to be a place where every kid dreams of going to every day and that parents within a one-hour, two-hour radius of Detroit are going to have their kids bugging them every Saturday to

DETROIT RIVERFRONT CONSERVANCY AND MICHAEL VAN VALKENBURGH ASSOCIATES

The Ralph C. Wilson Jr. Foundation donated $40 million toward construction of a $60 million park along Detroit’s west riverfront. The foundation also pledged $10 million toward an endowment to sustain the park’s operations.

come down here and play.” Construction of 22-acre Ralph C. Wilson Jr. Centennial Park, which is being underwritten by a $40 million donation from the Ralph C. Wilson Jr. Foundation, is expected to begin in 2020 and be complete by 2022. The park is envisioned as a public space to connect Corktown, Mexicantown and other neighborhoods of southwest Detroit to the riverfront walkway through downtown and the East Riverfront. “It’s a park we really do think is going to be transformational for our entire region,” said Matt Cullen, chairman of the Detroit Riverfront Conservancy and principal at Rock Ventures LLC. The conservancy has estimated the total cost of construction at $55 million to $60 million. The Wilson Foundation has committed $40 million toward construction of the park and $10 million toward an endowment to support ongoing operations that will be man-

aged by the Community Foundation for Southeast Michigan, Wallace said. Additional donors to the project will be announced later this year, Wallace said. “We are reaching out to a broad cross-section of the community and we’ve had a really favorable response from funders,” he said. The Delta Dental Play Garden will be one of four main areas of the park. The others will include “The Cove,” a beach and swimming area surrounded by fishing piers, and a sports house and park house, which will be designed by Sir David Adjaye, a world-renowned British architect and principal of Adjaye Associates. “It’s kind of a mind-blowing dream team,” Wallace said. “I worked in real estate for 10 years. Having David Adjaye and Michael Van Valkenburgh working together, it feels like having Diego Rivera do the murals.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

MACKINAC POLICY CONFERENCE

Education advocates plan push for after-school millage

COMMENTARY

By Sherri Welch swelch@crain.com

DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

Gov. Gretchen Whitmer makes her opening remarks at the Mackinac Policy Conference on Wednesday on the stage of the theater at the Grand Hotel on Mackinac Island.

Can Whitmer parlay no-fault kumbaya into a roads deal? MACKINAC ISLAND — Gov. Gretchen Whitmer is trying to capitalize on a rare moment of bipartisan cooperation in Lansing to get a road funding deal as she prepares to sign legislation Thursday that makes sweeping changes to Michigan’s no-fault auto insurance law. Two weeks ago, Capitol pundits were betting there would be a political meltdown between the Democratic governor and the Legislature’s Republican leaders Mike Shirkey and Lee Chatfield, resulting in either a Grand Hotel standoff at the Mackinac Policy Conference or Whitmer’s veto pen nixing a bill she had no role in shaping. But something funny happened as everyone was gearing up for the annual sojourn to the island — history didn’t repeat itself. Instead of a Republican-controlled Legislature sending a Democratic governor a bill they knew she’d deepsix, the two sides started talking. And kept talking. With little to no upside in making good on her veto threat, Whitmer negotiated with Shirkey and Chatfield and helped secure lopsided majorities in both houses for a bill that both bans insurers from using most no-driving factors in setting rates and frees motorists to choose their level of medical coverage in the event of an auto accident. “Divided government can be totally dysfunctional, as we see in Washington, D.C., right now,” Whitmer said last week in a podcast interview with Crain’s. “Or it can be incredibly productive as, I think, we’ve demonstrated in the first five months of this year.” “All of the goodwill and trust that’s been built up is going to serve us well as we tackle these next issues,” the gov-

CHAD LIVENGOOD clivengood@crain.com

ernor said on her 149th day in office. Finding a resolution on the next issues — balancing a state budget and resolving the multibillion-dollar shortfall in road funding — may make the yearslong slog to get auto insurance reform look easy. With auto insurance, legislators had a pent-up urge to take a whack at the auto insurance industry and the hospitals, medical providers and trial attorneys — after years of basically being under the spell of those special interests that have been able to maintain the status quo by controlling bipartisan factions of the Legislature. Unlike their predecessors, the Republican leaders decided to strike and strike fast — before the lobbyists with a vested interest in the status quo could move in like they’ve done many times before. “It’s always easier to poison a well than it is to dig one,” Chatfield said in an interview. “In the last 30 years, many stakeholders have been telling us why a bill wasn’t the right fix. And in the meantime, we have the highest car insurance rates in the nation.” But with road funding, there’s no trial attorney or insurance industry CEO to throw under the bus. Getting more money for roads involves either gutting large sums of discretionary spending in the $10.7 billion general fund — think slashing

Medicaid rolls, closing prisons and even more disinvestment in higher education — or raising taxes. As Chatfield and other lawmakers have boasted about their achievement of overcoming three decades of divisions on auto insurance reform, that stalemate is not much different than the impasse on road funding that has taken root in Lansing. Higher taxes on users has the backing of Business Leaders for Michigan, the Michigan Chamber of Commerce, the Detroit Regional Chamber and even the Livonia Chamber of Commerce, which recently turned some heads by endorsing Whitmer’s 45-cent gas tax increase proposal. Dow Chemical CEO Jim Fitterling, a member of BLM, supports Whitmer’s call for $2.5 billion more annually for roads. “You can’t expect the governor or any administration to try to fix this when the revenue won’t cover it,” Fitterling said. “I don’t think the numbers are unrealistic. It is going to take the kind of money that they’re talking about to get the quality of the roads up to where it needs to be.” Shirkey hasn’t ruled out higher taxes. And he’s seemingly ready to go all-in on resolving the road funding conundrum that has escaped his predecessors. “I want you to imagine for a moment the same kind of energy we’ve applied in both chambers on insurance reform, now turning and being focused on roads,” Shirkey told reporters Friday after passage of the auto insurance bill Whitmer signed Thursday. “That’s the only picture I need to paint for you.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

and geared to high school students. That research also explored revenue models to pay for those programs, including sales tax, a “sin tax” on marijuana and a millage, Egner said, but landed on a millage as the best option. “That raises the question of if you were going to mount a campaign, who would lead it?” Egner said. He said who would disseminate the millage revenue is also an open question. Private foundations cannot lobby if it involves a specific piece of legislation. Nonprofits, however, have the ability to organize and promote a ballot question, if it’s with a limited amount of their resources and related to their mission. It’s “very early in this discussion,” said Egner, who credits his own participation in Junior Achievement as a teenager with his success and interest in entrepreneurship.

MACKINAC ISLAND — A broad coalition of education advocates is pushing forward to place a countywide millage to support after-school programs on the Wayne County ballot in 2020. The coalition includes the Skillman Foundation, Ralph C. Wilson Jr. Foundation and city of Detroit. Timing for a vote and the amount of millage sought are not determined, but Mayor Mike Duggan revealed the plans Wednesday morning in a private meeting with attendees at the Mackinac Policy Conference. The initiative follows a successful millage campaign in November in Kent County, near Grand Rapids, to support early childhood programs. The Wayne County effort is modeled on successful dedicated tax campaigns in Philadelphia, Florida, Missouri and other “The research and best practices states. “Skillman’s in- across the country said make it credible work in ed- countywide, focused ucation has led them to this notion on millage of after-school is opportunities, and important ... (it) you’ve got to find an could be a real agency of some type chance to help kids focus,” said Dave that’s the collector Egner, president and the coordinator.” and CEO of the Wil- — Dave Egner, president and CEO of son foundation. the Ralph C. Wilson Jr. Foundation Only so much can be done inside the formal K-12 “The research and best practices system, given all of the demands on across the country said make it it, he said. countywide, focused on millage opAs Wilson and Skillman have portunities, and you’ve got to find an watched Hope Starts Here, a $50 mil- agency of some type that’s the colleclion early childhood education effort tor and the coordinator,” he said. launched by the W.K. Kellogg FounIn Kent County, an independent dation and the Kresge Foundation, nonprofit was created to manage and “we’ve been trying to make sure we’re oversee the millage revenue. adding value,” Egner said, noting “I have no idea where this is gosome of that work is still in formation. ing,” Egner said. “We just know what “We need to find our unique niche the data says.” to add value,” he said. A pilot program that includes 10 high A spokesman for the mayor de- schools in the area surrounding the ferred all questions about the effort Northwest Activity Center on Detroit’s west side has been operating since fall to the Skillman Foundation. “The Skillman Foundation has been with funding from Skillman, Wilson and encouraged by many in the communi- others, Egner said. Enrollment in those ty to look at ways for after-school pro- schools have gone up 500 students. “Duggan said this morning, ‘It’s grams to receive more attention and funding,” said Natalie Fotias, director parents saying it’s because (they) feel like (their) kids have a safe place to of communications for Skillman. “We’ve heeded this call, exploring go, and it’s useful things they’re doa myriad of ways the community ing,’ ” Egner said. could go forward to garner more supAllen has said the issue polls really port for the after-school system.” well and will pass, Kresge President Skillman has looked at what can be Rip Rapson said. He supports the done to strengthen funding and idea but also said there’s a need for a quality for after-school program- larger conversation about the comming, she said, “but at this point, no munity’s educational needs. decision has been made.” “There’s a lot to be said for spendThe Wilson and Skillman founda- ing more money on ‘out-of-schools’ tions funded research to look into the but as we think about … possible supbest-practice models around the port for young people in Detroit, there country on after-school or out-of- are other needs,” Rapson said. “But I school programs for high school stu- worry we haven’t thought as a comdents that foster emotional and social munity about how to support kids.” learning and provide 21st century job “It would be nice for us to have a … skills in areas such as robotics, literacy conversation on how to fund a specor finance and entrepreneurial pro- trum of youth-related needs,” includgrams delivered by nonprofits including work on issues such as class size ing Junior Achievement and FIRST and lack of school supplies, he said. Robotics. These are programs that grab interest and continue education. Sherri Welch: 313 (446-1694) They’re usually discipline-focused Twitter: @SherriWelch

SPONSORED CONTENT

Delta Dental Invests $5 Million in the Detroit Riverfront Conservancy

Crain’s Q&A: Delta Dental’s Detroit Riverfront Conservancy Investment Delta Dental and the Detroit Riverfront Conservancy have announced a $5 million corporate investment in a five-acre playground on the west riverfront in what will be Ralph C. Wilson, Jr. Centennial Park.

What is the overall vision of the Detroit Riverfront and for the future site of Ralph C. Wilson, Jr. Centennial Park? Matt Cullen, Chairman, Detroit Riverfront Conservancy The Detroit Riverfront Conservancy’s vision is to transform 5.5 miles of riverfront from the Ambassador Bridge to MacArthur Bridge, and to create a gathering place for our entire community. Ralph C. Wilson, Jr. Centennial Park is a major part of this vision, and it will be one of the most significant projects undertaken in our region in decades. Delta Dental’s remarkable gift of $5 million to support the new Play Garden within the park speaks to their strong commitment to healthy, smart, vibrant communities. It will be an unforgettable place in our city where children can connect with nature and develop a lifetime love for active living and recreation.

Why would a dental benefits company like Delta Dental invest in a playground on the Detroit River? Goran Jurkovic, President and CEO, Delta Dental of Michigan

Mark Wallace, President and CEO, Detroit Riverfront Conservancy; Goran Jurkovic, President and CEO, Delta Dental; and Matt Cullen, Chairman, Detroit Riverfront Conservancy

How did the Conservancy involve the community in the design process for the Play Garden at Ralph C. Wilson, Jr. Centennial Park? Mark Wallace, President and CEO, Detroit Riverfront Conservancy When we started to think about the future of West Riverfront Park, we wanted Detroit to dream big. We received support from the Ralph C. Wilson, Jr. Foundation to start a community-driven international design competition that has been recognized as one of the most inclusive processes that has been undertaken anywhere. Our design team led by Michael Van Valkenburgh Associates and Monstrom met with Detroit students in workshops to imagine animals they would like to see in the Play Garden. Projects like this are only possible when corporations like Delta Dental make an investment in communities. We are proud to partner with an organization that believes in the power of public space.

Delta Dental is grateful for the opportunity to provide benefits to nearly 6 million people in southeast Michigan. In return, we believe that we must be a force for good in the region every day. Placemaking is one way that we can build healthy, smart, vibrant communities where families can live, work and play. Our customers need talented workers to keep the region moving forward; talent goes to the coolest, most welcoming places. It just makes sense to invest in something that will engage families in healthy and fun activities for decades to come. The Delta Dental Play Garden represents the largest company investment in Delta Dental’s 62-year history and reinforces its commitment to supporting the communities in which it does business. SPONSORED BY DELTA DENTAL OF MICHIGAN

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

MACKINAC POLICY CONFERENCE

Nessel vows to move on shutting down Enbridge’s Line 5 pipeline in 30 days Crain’s Mackinac Policy Conference podcasts

By Chad Livengood clivengood@crain.com

MACKINAC ISLAND — Attorney General Dana Nessel is vowing to take legal action to shut down Enbridge Energy’s controversial Line 5 within 30 days if Gov. Gretchen Whitmer is unable to reach a deal with the company to decommission the 66-year-old oil pipeline. “If there is a not a resolution sometime very soon, then I have every intention of moving forward on this. ... In the next month,” Nessel said last week in a podcast interview with Crain’s at the Detroit Regional Chamber’s Mackinac Policy Conference. Whitmer, a fellow Democrat, has been trying to negotiate a faster timeline for Enbridge to shut down the twin 20-inch oil pipelines laying on the bed of Lake Michigan west of the Mackinac Bridge, just a short distance from the Grand Hotel where business, political and nonprofit leaders are gathered for this week’s annual confab. On Wednesday, the governor told Crain’s she is on board with the one month deadline. “I’ve been keeping the attorney general very close and up to speed on where that is headed and I don’t think that’s an unreasonable thing for her to suggest that we need to have a strategy that’s public within the next month or so,” Whitmer said in a Crain’s podcast interview at the Mackinac Island conference. “We’re moving forward and if we don’t have a resolution, it’s going to play out, I think, in court. I don’t think that’s a good thing. But, ultimately, that might be where it’s headed.” The governor has said she’s still open to allowing Enbridge to build a utility tunnel in the bedrock of Lake Michigan to house a new pipeline, but wanted to get the oil transportation giant to complete the project and decommission the existing pipeline faster than the projected sevento 10-year timeline. Peter Holran, director of U.S. government affairs for Enbridge, said Wednesday that the company’s engineers now project the tunnel can be bored underneath the 3.5-mile-long Straits within five years.

To hear podcast interviews with Gov. Gretchen Whitmer, Senate Majority Leader Mike Shirkey, Dow Chemical Co. CEO Jim Fitterling and many others recorded at last week’s Mackinac Policy Conference, go to Crainsdetroit.com, or search for Crain’s Detroit on iTunes, Apple Podcasts, Stitcher or wherever you find podcasts.

KELLY ROSSMAN-MCKINNEY VIA TWITTER

Attorney General Dana Nessel, right, and Crain’s senior reporter Chad Livengood discuss her plan to shut down a controversial oil pipeline within 30 days if Gov. Whitmer and the pipeline’s owners, Enbridge Energy, fail to reach an agreement to decommission it.

ENBRIDGE VIDEO SCREEN SHOT

Underwater video taken last year shows what appears to be damage to Enbridge’s Line 5 oil pipes from the April 1 anchor strike.

“We firmly believe this is no longer a seven-to-10-year project — rather this is a 4- to 5-year project,” Holran said in a podcast interview with Crain’s. “We certainly can do it much faster than even we thought we could.” The timeline for construction will

depend, in part, on Enbridge gaining the necessary state and federal permits and using a custom-built boring machine that can cut through the bedrock at a rate of 40-feet per day, Holran said. “Assuming we work through a normal permitting timeline, we should

be under construction by 2021,” he said. Enbridge has committed to paying for the $500 million utility tunnel. Until Tuesday, Nessel had not publicly put a deadline on Whitmer’s negotiations with Enbridge. “I’m not going to discuss what our legal tactics are going to be, although I’ll tell you that whatever we do, I’m sure you’ll be able to read it for yourself,” Nessel told Crain’s. “But I will say I did want to allow the governor some space to see if there was a way that she could get Line 5 shut down in a quicker fashion that wouldn’t take years and years of litigation.” Nessel said the attorney general has a constitutional duty “to protect our natural resources and to protect the Great Lakes — and I have every intention of doing that.” Whitmer said she’s working to get “a date certain” for shutting down Line 5, which has worried environmentalists and Mackinaw City and Mackinac Island businesses for years because of the threat of the pipeline rupturing and spilling oil into the Great Lakes. Attention on the underwater pipe-

lines ramped up in April 2018 after a boat anchor struck and damaged underwater electric cables and oil pipelines in the waterway that connects Lake Huron and Lake Michigan, causing about 600 gallons of mineral oil insulation fluid to leak from two electric cables. In October, then-Gov. Rick Snyder’s administration and Enbridge announced an agreement to replace the crude oil pipes that critics have long described as an environmental disaster waiting to happen in a crucial Great Lakes channel. But Whitmer ordered state agencies to stop work on the project in March after Nessel deemed unconstitutional a law that the state’s Republican-led Legislature hurriedly passed during a lame-duck session in December authorizing the construction. The state of Michigan granted Enbridge an easement in the early 1950s to run the oil pipeline through the Straits of Mackinac. Line 5 carries 540,000 barrels of oil and natural gas liquids daily from Canada through Michigan’s Upper and Lower peninsulas. The oil is piped to the Marathon Petroleum Corp. refinery in Detroit, the BP refinery in Toledo and refineries in Sarnia, Ontario. Nessel suggested revoking Enbridge’s easement rights to operate Line 5 would involve a lawsuit, but she declined to elaborate. “There are a number of legal theories and I think you will enjoy — whenever there is a court filing, in the event there is one — reading each and every paragraph that will lay that out,” Nessel said. “It’s legal majesty.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

Duggan wants $200 million in bonds for blight removal By Chad Livengood clivengood@crain.com

MACKINAC ISLAND — Detroit Mayor Mike Duggan said Thursday that he’ll ask City Council to place a $200 million bond issue on the March 2020 presidential primary ballot to fund residential blight removal after federal funds run out. The bond proceeds would be dedicated toward razing all remaining abandoned homes by 2024, Duggan said. “We’ve paid down so much debt, we can actually sell this bond issue with no tax increase,” the mayor said during his annual address at the Detroit Regional Chamber’s Mackinac Policy Conference. The new debt is needed to fund the demolition or possible renovation of 18,000 homes that remain aban-

“In five years, by the end of 2024, we will not have a single abandoned house in any neighborhood in the city of Detroit.”

Dave Massaron, chief financial officer for Duggan. The city’s improved credit profile nearly five years since emerging from a Chapter 9 municipal bankruptcy allows Detroit to borrow money for funding neighborhood blight removal, Massaron said. Detroit will run out of federal funding for blight removal by the end of this calendar year, Massaron said. Since Duggan took office in 2014, contractors have torn down more than 17,900 structures in Detroit, which had neighborhoods riddled with blighted and abandoned homes following decades of population decline from 1.8 million in 1950 to an estimated 673,000 in 2018.

— Detroit Mayor Mike Duggan

doned, Duggan said. “In five years, by the end of 2024, we will not have a single abandoned house in any neighborhood in the city of Detroit,” the mayor said, garnering an applause in the Grand Hotel’s theater. The proposed bond issue would be Unlimited Tax General Obligation bonds, debt the city services with an existing 9-mill property tax, said

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Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

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A groundskeeper on Tuesday drives past grandstand scaffolding set up at Detroit Golf Club for the Rocket Mortgage Classic at the end of June.

Detroit’s first PGA tournament boosts local business, nonprofits By Kurt Nagl knagl@crain.com

The upcoming Rocket Mortgage Classic PGA tournament has been good for business at the Detroit Golf Club — despite disruptions — and for local nonprofits seeing an upswing in participation. The tournament is less than a month away from teeing off June 25. The skeletons of grandstands are strewn across the grounds of the private club in northwest Detroit while groundskeepers hustle to rearrange the layout of the course. Private hospitality is sold out and grounds passes are still selling quicker than anticipated, tournament director Jason Langwell said. Langwell was joined by Quicken Loans Inc. CEO Jay Farner and Detroit Golf Club President Andy Glassberg during a media preview of the event Tuesday. Renee Fluker, president of nonprofit Midnight Golf, and Paula Love, executive director of First Tee of Greater Detroit, also delivered comments about the positive impact the golf tournament has already had on their organizations. “There’s no question that just as this tournament is raising the visibility of this city and what’s going on, it’s raising our visibility as well,” Glassberg said. “Our membership had been growing before, and I think the pace of that has picked up quite a bit.” The Quicken Loans-backed Rocket Mortgage Classic will be the city of Detroit’s first PGA event and the first in Michigan since the Buick Open folded in 2009. Some of the world’ best golfers — excluding Tiger Woods, at least for the time being — have committed to the event. It’s being lauded as a plus for the city’s profile and a way to showcase how it has recovered. Glassberg said his 700-member club has seen a big increase in enrollment, interest and website visits since news of the tournament went public in July. He declined to say exactly how many new members have signed up. Setup at the course began about a month ago. Hosting a PGA tournament can mean a lot of disruption and wear and tear, from professional-sized divots in the fairway to matted grass from excessive foot traffic. “There is, of course, an element of inconvenience, but frankly it has been thrilling to watch all of the hospitality structures and the sheer logistics of pulling off this event,” Glassberg said. Dan Totonchi has been a member at the club since 2005. These days, he said, the parking lots are extra packed and there are a lot of new faces in the

club house. He said the club seems to have capacity for the growth, and he hasn’t had an issue getting a tee time at either of the club’s two courses. Nor has tournament set up caused any big conveniences so far, he said. Members are generally embracing the tournament not just because it is raising the club’s profile, but because it has moved along course investment, including improvements to the grounds. “I’m not certain that would have happened if there hadn’t been an impetus with this tournament,” Totonchi said. \Participation in the First Tee’s spring classes is up 30 percent-50 percent, Love said. The organization offers free lessons to children in Oakland, Macomb and Wayne counties, with a focus on Detroit youth. About 230 kids have been registered so far this year. The average is 160. “Before the tournament is even here, we’ve noticed even in our spring registration, enrollment has gone up, with parents calling in and wanting to get their kids to participate in the First Tee and really just to learn about golf because they hadn’t been exposed to it before,” Love said. First Tee, Midnight Golf, the Detroit Golf Club Caddie Scholarship Fund and Detroit Children’s Fund are among the charities to benefit from the PGA tournament. Langwell said net proceeds from the tournament will be donated directly to the nonprofits. He said similar-size golf tournaments raise anywhere from $500,000 to more than $1 million, but he was unsure how much would be raised as this is the first year for the tournament. “The money we receive from the (Rocket Mortgage Classic), we would use that money to keep them in college,” Fluker said of the youth enrolled in the nonprofit program. She said the nonprofit helps kids learn golf and life skills. It launched in 2001 with 17 participants and has seen more than 2,500 go through the program since. Dozens of other businesses in the area will also benefit from the tournament as organizers contract with companies to produce the event. Troy-based Forte Belanger was tapped to cater the tournament. Around 50 companies will be hired — 50 percent are expected to be Detroit-based and 25 percent are minority-owned, Langwell said. “We’re adding them every day,” he said. Kurt Nagl: (313) 446-0337 Twitter: @kurt_nagl

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

MACKINAC POLICY CONFERENCE

Michigan Gov. Gretchen Whitmer addresses onlookers at the signing ceremony for the no-fault reform bill on the porch of the Grand Hotel on Mackinac Island.

LAW

FROM PAGE 1

The new law contains a complex and variable fee schedule that would go into effect July 1, 2021, and start ranging from 200 percent to 240 percent of Medicare rates and then be reduced to 195 percent to 235 percent of Medicare in 2022, followed by an additional reduction to 190 percent to 230 percent of Medicare rates in 2023. Hospitals with Level 1 or 2 trauma centers would get the higher rate, and hospitals in Detroit, Flint and Saginaw would receive a reimbursement rate of 250 percent of Medicare rates. “It’s a vast improvement on the original bills that came out of the House and the Senate,” Whitmer said Friday. “I worked with the hospitals to make sure in our rural and urban centers where these facilities are, that we’re mindful of keeping them open.” The law signed Thursday by Whitmer on the porch of the Grand Hotel will allow motorists to begin opting out of unlimited personal injury protection medical coverage in their auto insurance plans on July 1, 2020.

Motorists will have an a la carte menu of options that require insurers to reduce premiums for eight years: $500,000 of PIP, $250,000, an unlimited plan or $50,000 for certain Medicaid recipients. Motorists, including Medicare-eligible seniors, will be able to completely opt out of PIP coverage only if they have a qualified health care plan that covers auto injuries. And that may pose some new challenges for employers and their health care benefits managers as exposure to medical bills from auto accidents shifts to their health insurance plans. Most federally regulated self-funded plans automatically exclude auto injuries, posing even greater challenges for motorists who may want to shed PIP coverage. The one-year implementation timeline for the new law was added to the bill to give businesses time to make changes to their health care plans, said House Minority Leader Chris Greig, D-Farmington Hills. “There’s going to have to be a complete review of health care plans that businesses offer as well ... and see are we shifting costs or are we actually

just having more options?” Greig said. One potential issue is employer health care plans run on a calendar year with open enrollment in the fall. Auto insurance plans run on sixmonth cycles that start when the motorist purchases the plan, which could complicate implementation of the new law and when motorists start seeing mandated savings to the PIP portion of the auto insurance premiums, Greig said. “Here’s just a lot of things that we really have to spend the time and work with both business and consumers to make sure we’re rolling this out appropriately,” she said. Quicken Loans Inc. and its family of companies have a self-funded health insurance plan for its 17,000 employees that doesn’t cover auto injuries. Jared Fleisher, vice president of government affairs for Quicken Loans, said the Detroit mortgage company would be adding auto injury coverage to its health care plan to adapt to the auto insurance reform law the company advocate for in the Legislature. “As soon as a I take my horse and buggy back down to the ferry and get to Detroit, our first meeting is with

our benefits people,” Fleisher said. “We plan to be at the head of the curve in making that change.” Quicken Loans and affiliated companies owned by businessman Dan Gilbert have not historically covered auto injuries because employees were required to purchase unlimited medical PIP coverage under the 1973 no-fault insurance law, Fleisher said. “Anything that we did through our company health plan we believed would have had certain additional costs for our team members without certain cost savings to offset them,” Fleisher said. “And now that we are sure that by Quicken Loans covering auto-related accidents, folks can save hundreds and in many cases thousands of dollars, you better believe we’ll be at the forefront of adding that to our plan.” Fleisher downplayed the potential cost shift to employers, calling it “indiscernible.” In its work on auto insurance reform, Quicken Loans employees studied the cost of auto injuries for employers in other states that rely on health insurance plans to cover auto injuries instead of the separate and unique insurance Michigan has long

DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

required motorists to purchase. “We believe — having studied the issue extensively — that the cost shift onto employers will be marginal,” Fleisher said. While the benefits managers of employers study the implications of auto insurance reform, the businesses that have long charged no-fault carriers their highest rates are preparing for a change in their business model. Hospitals are uncertain about whether private health insurance plans will reimburse for the expenses they incur treating patients critically injured in a vehicle or motorcycle accident who opted out of personal injury protection coverage on their auto insurance. “The more pertinent part of that question relates to what will happen to the bill on the back end,” said Wilson, the COO of Beaumont Health. “... We are worried that Michiganders will end up with large copays, large unpaid bills by their insurance companies that could impact their financial situation in the long run.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

Gilbert pledged road-funding support day before his stroke By Chad Livengood clivengood@crain.com

MACKINAC ISLAND — Quicken Loans Inc. founder and Chairman Dan Gilbert sent Democratic Gov. Gretchen Whitmer text messages Saturday pledging to be “all in” on helping her secure a road-funding deal with the Republican-run Legislature on the day after lawmakers sent the governor sweeping Gilbert-backed changes to the state’s auto insurance law, according to aides for both camps. The next morning, the influential billionaire mortgage and Detroit real estate mogul was hospitalized for what his company described as “stroke-like symptoms” and later that

day suffered a stroke requiring an emergency catheter procedure. Gilbert’s lobbyist said his boss relayed his promise to the governor the day before his health scare unfolded. “We are all in on the effort to fix the roads,” said Jared Fleisher, vice president of government affairs Fleisher for Quicken Loans. “And if you know one thing about my boss, he gave us these marching orders.” Fleisher added of Gilbert: “He’s resting at the moment, but on that Saturday he let the governor know that he was all in on this issue, and he let us know this was our next charge.”

Fleisher detailed Gilbert’s “marching orders” for his team to pivot to lobbying for a long-sought solution to Michigan’s underfunded roads during an interview with Crain’s at the Detroit Regional Chamber’s Mackinac Policy Conference. An aide to the governor confirmed Fleisher’s account of the text messages exchanged between Whitmer and Gilbert the day before he was hospitalized. Gilbert’s companies have not provided a public update on his health condition since Tuesday. Fleisher helped engineer the auto

insurance reform legislation on Gilbert’s behalf, lobbying lawmakers on both sides and using the threat of a ballot initiative as a carrot to prod GOP leaders, Whitmer and businesses with a stake in the multibillion-dollar no-fault industry to reach a deal in the matter of three weeks. With the no-fault reform bill now law — an outcome that seemed unfathomable just a month ago — Gilbert’s team is planning to put the same amount energy into pushing a divided state government to reach an equally unfathomable deal on investing more money in roads and infrastructure. In his last public statement before being hospitalized about the Legislature’s passage last Friday of the no-

fault bill, Gilbert said, “it is time to move on to the next big one and fix Michigan’s roads and bridges.” Quicken Loans is not taking a formal policy position on Whitmer’s proposed 45-cent gas tax increase or her line-in-the-sand demand that the Legislature come up with a plan that generates $2.5 billion more annually for roads and bridges. “It’s not our place to say 45 cents, some cents, this number, that number — I’m not an engineer,” Fleisher told Crain’s. “We know there has to be a major step taken to solve this problem — and that’s what we stand for.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

MACKINAC POLICY CONFERENCE

Foundations could set path to funding DPSCD’s capital needs By Sherri Welch swelch@crain.com

Foundations could be in position to help the state’s largest school district address its long-deferred capital issues. The idea was floated by the Kresge Foundation during a Wednesday meeting of the funders supporting Detroit’s Strategic Neighborhood Fund and city officials, convened by Detroit Mayor Mike Duggan. Detroit Public Schools Community District estimates it has $500 million in capital needs, but it can’t seek state-secured debt to fix its buildings under the 2016 state legislation that separated the new school district from the old DPS and its liabilities. Duggan told the foundations the district needs a fix, Kresge President Rip Rapson said. And Aaron Seybert, social investment officer at Kresge, promptly reminded everyone that there was $40 billion in the room that could be used to guarantee bonds. The power of Seybert’s statement was that at least locally, “no one had even thought about that,” Rapson said. Foundations could back the bonds through their assets, taking the highest risk “in hopes we’d never pay a dime and the schools would repay it,” he said. That, in turn, would help attract private investors.

The philanthropic guarstatement. antee model is something “It is encouraging to Kresge is looking at to supknow that the business and port the cradle-to-college philanthropic communiconcept on the Detroit ties are increasingly campus of Marygrove Coldemonstrating the willinglege, he said, and someness to solve the problem.” thing it’s working on naKresge has been incubattionally. ing the “guarantee bank” or Kresge is assembling a Community Investment “guarantee bank,” Rapson Montgomery Guarantee Facility as an efsaid. fort to launch the first, doTabron It’s secured $27 million mestic, multi-investor pool in commitments from five other of guarantees for community develfoundations for that national effort, opment, said Kimberlee Cornett none of them in Michigan, he said. managing director of Kresge’s social There are a lot of details to be investment practice, in an email. worked out, “but the concept of philThe bank will make guarantees in anthropic guarantees to support the housing, climate and small busibond issues is an innovative way of ness sectors to accelerate investment getting some financing,” said La June into low income communities. It’s Montgomery Tabron, president and expected to make its first guarantee CEO of the W.K. Kellogg Foundation. commitments this year, Cornett said. “I think we’re ready, (and) I think “Guarantees are a less-utilized, but it’s time,” she said. “I am happy to see powerful tool by philanthropy (that) investments back in the city of De- are highly efficient at crowding in troit at the level where something like capital that otherwise, might not inthis can even be feasible. vest,” Cornett said. “We have to be creative around fiAs part of its impact investing nancing. This could definitely be an commitment, Kresge’s board has alopportunity to figure out how to located $150 million in guarantees, make it happen.” she said, and approximately $100 DPSCD is considering all options million of that is already dedicated. to provide its students with facilities they deserve, DPSCD Superinten- Sherri Welch: (313) 446-1694 dent Nikolai Vitti said in an emailed Twitter: @SherriWelch

Regional CEO group pushes to get Detroit students workforce-ready By Sherri Welch swelch@crain.com

The group of Southeast Michigan CEOs that launched a new regional economic development group and took a stand on regional transportation last year has swung back around on workforce development. The group is coordinating 200 higher-level internships for Detroit youth who are ready to enter the workforce. At the same time, it’s beginning efforts to create career pathways for high-demand jobs — like dealership technicians — that don’t have programs at community colleges and/or marketing to make people aware of those opportunities. “In the education and workforce space, we’ve been doing some good work … particularly in career and technical schools,” said group chair Gerry Anderson, who is chairman and CEO of DTE Energy Co. The CEO group is also continuing its support for the city’s summer youth employment program, Grow Detroit’s Young Talent. “But we’re employers, not educators,” Anderson said. “We’re looking for ways as companies to help on the education front without positioning ourselves as experts to fix the system.” The most natural place to do that, he said, is to look at how companies can pull high school graduates into their companies. “We want to build the muscle to make this something we do within

our own organizations ... (as) part of the way we do business,” rather than through an outside nonprofit or organization, he said.

Career pathways

At the same time, the CEO group is working with companies — starting with those represented by its members — to identify jobs in demand but tough to fill and then creCareer academy ate pathways to them. Those jobs include lineThe group is working workers and tree trimmers at with the city and Detroit Anderson DTE and technicians at auPublic Schools Community District on a “career academy” that tomotive dealerships, Anderson said. has set a goal to line up 200 high-lev- There’s significant need but not a ready el internships for high school stu- flow of training to fill them. There are other examples in health dents approaching graduation. The positions are not about giving care, utilities and coding in the inforkids the basics, but would be geared mation technology realm, he said. To address the gaps, the CEO group to those who are ready for a job that will help them build real job skills, plans to work with local community colleges and Detroit Mayor Mike DugAnderson said. These internships will build on the gan’s workforce development board to early, more routine jobs offered identify curricula and training to prethrough Grow Detroit’s Young Talent pare people to enter those jobs, creatby giving students a chance to use ing a chain after high school. The companies would need to identheir computer or project management skills or to learn basic finances, tify end points and ensure the right curriculum is in place to train people he said. “Some of the early jobs are about for those jobs and to market those opshowing up … and being able to do portunities, Anderson said. “At the end point, we can provide some routine work,” he said. “That’s OK, but as you get closer to graduat- positions in our companies for those ing and getting into the workforce, people,” he said. Economic development pulls on you need more serious skills.” Students identified by the schools workforce development, which is fed go through a program to prepare by youth employment, Anderson said. “There’s a chain there from educathem for the internships, Anderson tion all the way to economic developsaid. To date, the CEO group has lined ment.” up 170 or more eight- to 10-week internships with local companies, he Sherri Welch: (313) 446-1694 Twitter: @SherriWelch said.

TIMOTHY J. SEPPALA

Epic Games is targeting its 3-D software known as the Unreal Engine toward the automotive industry with its new Detroit office.

EPIC

FROM PAGE 1

It also has competition from another game design tool that’s being adapted to industry, the Unity Engine from San Francisco-based Unity Technologies. Epic sees a Detroit location as a competitive advantage, and expects its presence in the region will help win new clients. “You can only understand how the industry will develop and what it needs if you’re a part of the project and you’re where the stuff is happening,” said Heiko Wenzcel, head of the Epic Detroit Innovation Lab. Before joining Epic this March, he spent 11 years as president of Stuttgart-based

MERGER FROM PAGE 3

Common platforms “would give both companies a lot more freedom in manufacturing,” Sam Fiorani, vice president of AutoForecast Solutions, told Reuters. “They could mix brands and vehicle sizes on the same assembly line, switch vehicles between plants to balance production, and even shift production from one country to another, depending on changes in demand, tariffs or other considerations.” That’s good or bad news depending on a supplier’s ability to secure new work. “The general economics of the thing naturally creates winners and losers,” said Richard Hilgert, senior equity analyst for Chicago-based Morningstar Research Services LLC. “That means some suppliers are going to be getting more volume and others will lose out on volume eventually. But that will depend largely on the suppliers’ footprint.” Local suppliers with large footprints in Europe may hold an advantage if FCA and Renault merge, as the two automakers would likely share new common model platforms, thus allowing a supplier to supply the same part for models that are branded under FCA in the U.S. and Renault in Europe, said Hilgert. “What the (merged) company will need to do to get the most bang for its buck is find the Tier-Ones that can provide the same product across geographic regions where the companies share facilities,” Hilgert said. But any supplier consolidation likely wouldn’t happen for several years, said Daron Gifford, partner and strategy consulting services leader for the automotive industry unit of Plante Moran. “The more aggressive suppliers,

CGI effects house Mackevision at its Troy location. Armen Kabodian, vice president of business development at creative agency Texel Logic in Dearborn, which has used Unreal Engine, agreed. “You have to physically be here to be a part of the automotive industry,” Kabodian said. “It’s not a fly in, fly out industry.” Currently, Wenzcel is taking part in workshops, dubbed Unreal Academy, that teach interested programmers how to use a game engine for auto design. He's also attending related conferences and scouting office spaces. Wenczel said Epic is currently hiring to fill 10-15 expert-level support staff positions, with a goal to open an office here by year’s end. trying to think ahead, are already meeting and talking about a plan,” Gifford said. “But it will be 2022-2023 before you see much impact on operations because it’s not easy for any of the automakers to switch tooling and resource parts in the middle of the current production cycles.” In the U.S., where FCA’s mainstays Jeep and Ram reign supreme for the automaker, the merger is unlikely to have much downside for suppliers down the supply chain, said Steve Wybo, senior managing director of Birmingham turnaround and adviso-

“The general economics of the thing naturally creates winners and losers. That means some suppliers are going to be getting more volume and others will lose out on volume eventually.” — Richard Hilgert, senior equity analyst for Morningstar Research Services LLC

ry firm Conway MacKenzie Inc. “Most local suppliers don’t have a lot of crossover in Europe, outside of the large Tier-Ones,” Wybo said. “I don’t see a rationalization of the supply base. Sure, there will be economies of scale but that won’t happen in the U.S. There’s just limited opportunity in this merger and certainly no real down side for suppliers here. I see this as really a non-event for local suppliers.” Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

Selling’s on table as Southwest businesses consider Ford’s impact By Annalise Frank afrank@crain.com

Hygrade Deli owner Stuart Litt is getting older and his Michigan Avenue restaurant could soon be ripe for a sale. “Somebody’s gotta come knocking” on the door of the shop known for its corned beef as investors seek stakes on Michigan Avenue near Ford’s planned Corktown campus investment, said Litt, 63. And he’s strongly considering handing the 65-year-old restaurant at 3640 Michigan Ave. to the highest bidder. “I’m thinking in terms of: It’s time for me to go,” he said. “With Ford coming in, they’re telling me ‘Oh, this place is gonna be filled up.’ Being as though I’ve already put in 47 years, maybe it’s time to possibly think about selling to someone who wants to take this place … and maybe take it beyond what I can do …” Last year Litt saw his best sales since the 1970s, he told Crain’s. But he’s not hurrying to cash out. He said he’s waiting for a “peak” sometime in the next couple of years. He pointed to the extra traffic he’d see if planned restaurants from Sugar House owner Dave Kwiatkowski and George Azar, the chef behind Flowers of Vietnam, materialize near him on

SDBA FROM PAGE 3

They’re seeking funding that would aim to help revitalize Michigan Avenue — a corridor seen by some as having the best business argument for attracting investment that pushes outside the Ford-Corktown footprint. Southwest Detroit Business Association President Robert Dewaelsche declined to disclose the amount the groups are seeking. SDBA is also seeking other funders and has seen interest but no commitments yet. The proposal would fund staff and programming to extend the SDBA’s facade improvement and business assistance to Michigan Avenue between Detroit’s border with Dearborn and Michigan Central Station in Corktown. Its programs now focus largely around West Vernor Highway and Bagley Street. If they got the money, Dewaelsche said, they’d start small while reaching out to Michigan Avenue businesses and communities on ideas for eventual projects with a “greater impact,” such as larger real estate developments. The SDBA has also worked on property rehabilitation and is a development partner in a $12 million mixed-use project on Vernor. In joining the pitch, the Corktown Business Association wants revitalization work to be carried from its own neighborhood — including streetscape improvements and redoing Roosevelt Park in front of Michigan Central Station — west along Michigan Avenue, said business association president and McShane’s Pub co-owner Bob Roberts. “So what is Corktown going to look and feel like with Ford in its presence? And take that look and run that west to the city limits all along Michigan Avenue. That’s the CBA’s interest in it,” Roberts said.

the Southwest thoroughfare. It links Ford’s Corktown plans just east of Hygrade, centered around Michigan Central Station, with its Dearborn headquarters. Litt is among a host of Southwest Detroit business owners Crain’s spoke with about fears, plans and hopes as Ford navigates its train depot renovation, expecting to finish by 2022. Here’s a selection of comments. Gloria Rosas Baiocco of Xochi’s Gift Shop, 3437 Bagley St. “Ford coming in is a huge asset … but it’s not like they’re here to save the day. We have maintained our business vitality and resident vitality (through the years) … Things that have affected many communities, we worry about that happening to us. But on the same hand, Detroit needed new investment, Detroit needed new residents ... “We just have to be prepared to be flexible with the needs of the new market, whether it be new residents or different tourism. We’ve noticed some of our newer residents have a taste for X merchandise ... We are taking part in doing some upgrades to our facades. We have a mural coming soon to our building.”

Jason Ghannam of Paul’s Pizza, 7635 Vernor Highway “With Ford, everyone’s realizing that the neighborhood is changing, and some people think for better and some people think for worse. “The businesses that didn’t get themselves prepared for this are going to become overwhelmed with people and population. People and population will then flow to the businesses prepared for it. (We’re) taking this two to three years to wind up to get us prepared for when those days happen … The truth is, Ford hasn’t brought an employee to that building yet.” Bertin Garita (son of owner Norberto Garita) of El Barzon, 3710 Junction Ave. “I think the way it’s going, it’s going to be a while (before we see investments materialize along Michigan Avenue), but at the end of the day, what I hope for, you know, for Livernois and Michigan all the way down to Corktown, I think there’s going to be a lot of other businesses opening. It’s just a matter of time.” Annalise Frank: (313) 446-0416 Twitter: @annalise_frank

More shaping efforts

Not alone

Investment to spur commercial and residential development along Michigan Avenue could complement Bill Ford Jr.’s previously stated vision of making the stretch a “transportation invention corridor,” as Crain’s reported last summer. The Detroit section is about four miles from Michigan Central Station to Wyoming Avenue, with its share of blighted and boarded-up buildings as well as much-loved, longtime businesses and several incoming redevelopments. The bulk of it sits in between two areas the city of Detroit is focusing on through planning strategy frameworks: greater Corktown and the West Vernor corridor. It’s not yet clear whether the Ford Fund will grant SDBA’s funding request. But it’s an “ongoing discussion” to determine if the proposal aligns with the Ford Fund’s mission to improve lives and social mobility, said Pamela Alexander, director of community development for the Ford Fund. “We hope that (Ford’s Corktown campus) will be a catalyst to help spur development by any number of individuals along the (Michigan Avenue) corridor,” she said. Other actions taken by the Southwest Detroit Business Association in the wake of the Ford-Corktown reveal last year include absorbing the Michigan Avenue Business Association and electing Dave Dubensky, the chairman and CEO of Ford real estate arm Ford Land, to its board. Dubensky stepped down from the board earlier this year “due to his heavy travel schedule,” a Ford representative said in an email. He has been replaced by Paula Roy Carethers, Detroit development manager for Ford.

The Corktown and Southwest associations aren’t the only ones positioning themselves as players on Michigan Avenue. Around 28 businesses, property owners and neighborhood representatives along the corridor are working to revive a Western Market Commercial District, the collective’s leader, Christopher Hájek of The Hájek Firm PLLC, said in an email. They incorporated a nonprofit for the purpose and aim, initially, to make streetscape improvements between I-75 and West Grand Boulevard. Those could be funded in part by creating a business-improvement tax assessment zone. And nonprofit Southwest Solutions is preparing a multi-pronged neighborhood development strategy for the Chadsey-Condon neighborhood on the north side of Michigan Avenue and the edge of Corktown. Dewaelsche, the Southwest Detroit Business Association president, said the SDBA isn’t “actively working” with either the Western Market or Chadsey-Condon groups on Michigan Avenue plans, though he’s had preliminary talks with Western Market. But he said he sees the efforts as complementary and would like to either collaborate or “at least share information.” Southwest Solutions is putting together a “robust” plan that would aim to “recreate a neighborhood,” likely stitching together affordable housing, workforce and entrepreneur development, blight removal and vacant lot development with the goal of building prosperity, said Hernandez of Southwest Economic Solutions. It hasn’t yet identified partners, but does have seed funding in Chadsey-Condon through a $2.5 million donation announced in September for affordable housing. There’s a “good value proposition,”

As the value of his business rises with excitement surrounding Ford Motor Co.’s planned $740 million Corktown campus, Hygrade Deli owner Stuart Litt thinks he may sell to the highest bidder within the next couple of years. Hygrade serves breakfast and sandwiches on Michigan Avenue in Southwest Detroit. ANNALISE FRANK/CRAIN’S DETROIT BUSINESS

Hernandez said, in building attractive neighborhood necessities along Michigan Avenue to cater to future employees at Ford-affiliated suppliers who want to live close to their jobs but may not earn enough for higher prices in Corktown. “... Obviously nobody is going to do that alone,” Hernandez said. “At some point we’ll (need partners), but somebody has to create this concept (to pitch) folks ... then there’ll be natural gaps identified so we can invite others into it.”

Not a no — a ‘not now’ According to Hernandez, Southwest Solutions' Chadsey-Condon strategy could include elements of an affordable housing initiative it presented to Ford in summer 2018. The nonprofit met with Ford Fund and Ford real estate arm representatives to discuss both Ford’s impact on the community and to pitch a $1 million-$2 million development plan Ford could invest in, Hernandez said. Ford would not confirm the talks. It was “cordial” and Ford didn’t say no, Hernandez said, just “not now.” Hernandez said his impression was that Ford wants to make sure it “deliver(s) on the promises and commitments they made to the Corktown community.” He said he understands, but thinks development could occur in other areas of Southwest on a “parallel track” with Corktown. He added he wants to eventually restart the discussions, as Ford could play an "anchor role" in revitalizing Michigan Avenue. These various plans would help shape Southwest’s future, in large or small ways, as discussions swirl around how move forward equitably. “Obviously there’s going to be more effect (from Ford’s presence) beyond a small geographic area,”

said City Council member Raquel Castañeda-López of District 6, which includes Southwest and Corktown. “Unfortunately some neighborhoods are more prepared ... it’s just making sure that those needs are incorporated to the extent that it falls in Ford’s responsibility and jurisdiction.” An overarching concern for Corktown and the wider region is rising land values, as excitement builds surrounding Ford’s campus. “People are being priced out already, and it’s only going to get worse,” Hernandez said. The Detroit Free Press reported last year on rising home values in Southwest. Crain’s has reported on the Corktown “gold rush.” And the lack of affordable housing across Detroit is expected to worsen before it gets better, according to a report released in early May by Lansing-based nonprofit Michigan League for Public Policy. Housing is generally considered affordable when it consumes no more than 30 percent of household income. Detroit's median household income is $27,838, the nonprofit reported in February, and nearly half of households spend more than that 30 percent. “In my opinion, if you don’t want gentrification to take place in terms of pricing people out of what they’re used to paying or literally displacing them ... build more housing,” Dewaelsche said in an interview earlier this year. "That works for both the market-rate side and the affordable housing side." It takes two to three years to develop affordable housing, according to Hernandez. If plans don’t beget action soon, there could be a squeeze if Ford’s plans to bring 2,500 employees by the end of 2022 — and more in later years — come to fruition. “I think we see it as a critically important time,” Hernandez said. “If we

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

CENSUS FROM PAGE 3

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Wider benefits Hernandez and Castañeda-López, among others, lauded Ford’s community engagement efforts surrounding the Corktown project. They range from public meetings to a newsletter and creating a project-focused information center in The Factory on Michigan Avenue by the train depot. Castañeda-López added that there’s fear with any Detroit development about who benefits and who’s left out, but that Ford has been more “genuine and respectful” of community than many other developers. Ford and the city agreed that the automaker would invest $10 million in workforce education and training, Invest Detroit’s Core City Strategic Fund and the Affordable Housing Leverage Fund as part of a community benefits agreement that’s required for projects getting certain public financing or property. Parts of it center around a designated “impact zone” that includes Corktown, North Corktown and a section of the Hubbard-Richard neighborhood, but much of Southwest is excluded. However, Ford is engaging with the region, not just Corktown, said Alexander, the Ford Fund’s director for community outreach. “It’s not a situation where you draw a line that says, ‘OK, well, we’re not going to cross the street,’” Alexander said. “That’s not the case at all.” She referenced Ford Volunteer Corps work, as well as events that target attendees from across the city and metro Detroit — its winter festival in front of Michigan Central Station, for example. She noted the automaker organization isn’t new to the area. It has exist-

ing relationships with Southwest Solutions and others through its Ford Resource And Engagement Center, which opened in 2013 in the Mercado building on Bagley Street just southwest of the train depot. Ford Land CEO Dubensky spoke with Crain’s last year about “involving the community” to assure the campus doesn’t become a “corporate island.” Alexander said preserving culture and responding to concern about rising housing prices starts with listening to locals — something she called a “centerpiece” of Ford’s development strategy.

‘Culture and community’ Public feedback Ford received fueled a new Ford Fund grant program that culminated in a Thursday pitch competition for a total of $250,000. The Southwest Detroit Business Association was among eight finalists announced in Ford’s May Corktown newsletter. Their ideas needed to “celebrate culture and community” in the greater Corktown impact zone designated under the Ford community benefits agreement. Winning nonprofits, picked by the public and a judge panel, will be announced June 15. SDBA’s pitch with the Corktown Business Association and Gaelic League would revive the Irish-Mexican Fiesta held in the early 2000s, Dewaelsche said. Others included the Detroit Police Athletic League for a Corktown youth journalism program and Heritage Works with community space activation. “I’ve heard that over and over again, that (the theme of celebrating culture and community) is a very important part of what this region is,” Alexander said. Annalise Frank: (313) 446-0416 Twitter: @annalise_frank

After facing several legal challenges, the citizenship question is now before the U.S. Supreme Court. The U.S. Census Bureau seeking a response by June in order to finalize census forms, according to a National Public Radio report in April, but could extend its deadline as late as Oct. 31 if Congress approves additional funding. If the question stands, it will be the first time the question will be asked of all U.S. households since 1950, according to NPR. As home to the country’s largest Middle Eastern communities and significant Latino populations in Detroit and Grand Rapids, Michigan could face significant undercounts in immigrant and undocumented populations, according to the Michigan Nonprofit Association, which is aligning nonprofits to provide census education and outreach in hope of increasing census participation. “Especially in this political environment of polariziation, (with) this unfortunate debate about immigration that has taken a nasty turn, I think that will impact all immigrant communities that are historically hard to count,” said Hassan Jaber, CEO of the Arab Community Center for Economic and Social Services in Dearborn. Latino populations fear if they fill out the forms, U.S. Immigration and Customs Enforcement is going to come looking for them, said Jane Garcia, who is chair of Latin Americans for Social and Economic Development in Detroit and a former, longtime community partnership specialist for the U.S. Bureau of Census. By law, census data can't be shared across federal departments for 70 years, said Jaber, who served for six years on the U.S. Census Bureau’s National Advisory Committee on Racial, Ethnic and Other Populations up until late 2018. National advocacy groups are starting to form a consensus that anyone who is worried should just skip the citizenship question, he said. But there are still fears. “I fully understand their hesitation, (but) I fully believe the Census Bureau will do everything (it) can to ensure confidentiality of data and uphold the law on this,” he said.

High cost of counting Michigan actually saw a slight overcount during the last census, due to double counts of, for example, the mother-in-law living in a cottage in the backyard, said Eric Guthrie, state demographer for Michigan. But within that, populations of people who often rely on federally funded programs like Head Start or housing and food assistance, underreported, due to reticence to report, lack of ability to do so or errors such as forgetting to count a newborn child, Guthrie said. Populations that are typically undercounted include low-income, minority, immigrant, rural, renter and young children populations. Ensuring accurate population counts is important, with federal funding for programs ranging from food and housing assistance to Head Start and highway construction hanging in the balance. For each person who is not counted, Michigan will lose an estimated $1,800 per year, Guthrie said. The state’s most recent population

estimate for 2018 is just shy of 10 million, according to the Census Bureau’s Annual Population Estimates program, said Kurt Metzger, founder of Data Driven Detroit and mayor of Pleasant Ridge. And about 7 percent or 703,806 of the state’s residents were foreign-born in 2017, the most recent year available for those Census Bureau estimates. Of the state’s foreign-born residents, 49 percent were not citizens, Metzger said. But that doesn’t mean they were illegally in the country; some may have been here on work visas or refugees allowed into the U.S. Based on the estimate that the state will lose $1,800 per person annually for each person not counted, Michigan would lose about $621 million a year in federal funding, if all noncitizens elect not to fill out the census form. Michigan’s total budget for the current fiscal year is $58.2 billion. Federal allocations account for $22.8 billion or 39 percent of that, said Kurt Weiss, a spokesman for the Michigan Department of Technology, Management and Budget.

Nonprofit outreach The state will have just five area census offices statewide for the 2020 census, in Detroit, Lansing, Midland, Macomb County and Oakland County, though outreach will take place in other areas, the bureau said. It will have no sites on the state’s west side, in the northern Lower Peninsula or the Upper Peninsula. MNA has been ramping up its outreach efforts since 2017 to help fill the Census Bureau gaps around the state. Chaired by MNA President Donna Murray-Brown and Jaber, the campaign launched with a seed grant of $600,000 from the W.K. Kellogg Foundation to give nonprofits the funding, training and tools needed to encourage hard-to-count populations that are typically underreported to take part in the census. It was focused on Detroit, Dearborn, Flint and Grand Rapids. But since then, over 40 foundations and the state of Michigan have contributed a total of $5.4 million to what is now a statewide effort, Gustafson said. MNA has designated 13 large nonprofits to serve as “hubs” around the state to serve as regional managers for the statewide campaign and fiduciaries for pools of microgrant funding they’ll distribute to community-based nonprofits. The hubs, whose reach will extend to 56 of the state’s 83 counties, are now in the process of creating mini grant strategies, issuing grant proposal requests and reviewing those submitted, Gustafson said. Outreach will be focused on educating the public on why it’s important everyone is counted, dispelling myths and providing translation services and internet access to people who need it to fill out the forms, she said. Outreach could range from town halls to educate local populations to hosting computers or Wifi at set locations in the community to distributing information at community events, Gustafson said. To address outreach in the counties not already covered by large nonprofit fiduciaries in each region, MNA plans to make a grant to Michigan Community Action, the association for the state’s community action agencies. Sherri Welch: 313 (446-1694) Twitter: @SherriWelch

H crainsdetroit.com Editor-in-Chief Keith E. Crain Publisher KC Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Associate Publisher Lisa Rudy, (313) 446-6032 or lrudy@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Product Director Kim Waatti, (313) 446-6764 or kwaatti@crain.com Digital Product Manager Carlos Portocarrero, (313) 446-6056 or cportocarrero@crain.com Creative Director David Kordalski, (216) 771-5169 or dkordalski@crain.com Assistant Managing Editor Dawn Riffenburg, (313) 446-5800 or driffenburg@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Special Projects Editor Amy Elliott Bragg, (313) 446-1646 or abragg@crain.com Design and Copy Editor Beth Jachman, (313) 446-0356 or bjachman@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687, TIP LINE (313) 446-6766

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 3 , 2 0 1 9

THE WEEK ON THE WEB

RUMBLINGS

As Dan Gilbert recovers from stroke, business goes on

New Greyson Clothiers high-end golf shop opens

MAY 24-30 | For more, visit crainsdetroit.com

Quicken Loans Inc. Vice Chairman Bill Emerson sought to assure Detroit business leaders last week that Dan Gilbert’s family of companies are running smoothly while the online mortgage mogul recovers from a stroke he suffered May 26. “There’s two things I know about Dan: One is he is one tough human being — and he will come back as fast and as strong as anybody can in this particular situation,” Emerson said during an on-stage appearance last Wednesday at the Mackinac Policy Conference, where he subbed for Gilbert. Emerson said Gilbert has built “an incredible team” of CEOs who run Quicken Loans, Rocket Fiber, the Cleveland Cavaliers, StockX and the dozens of other businesses in Gilbert’s portfolio. “So if there’s anybody out there concerned that business isn’t going to happen as usual, they should stop being concerned about that,” said Emerson, who also is CEO of Bedrock LLC, Gilbert’s real estate management and development company. “We know what the mission is, we know what to do, we’re executing on that mission.” Gilbert was taken to an undisclosed hospital early Sunday for “stroke-like symptoms” and suffered a stroke at the hospital that required “a catheter-based procedure,” Quicken Loans CEO Jay Farner said in a statement released last Monday. The Detroit News reported it was Beaumont Hospital in Royal Oak. Emerson, who visited Gilbert in the hospital last Monday, said his boss is “taking a break.” “He’s taking a hiatus,” Emerson told interviewer Dennis Archer Jr. “And when he comes back, things are going to be as good as ever as they were when he left. We’re going to give him the opportunity and we’re going to give his wife the opportunity to spend the time she needs to spend with him.” Gilbert’s wife, Jennifer, is founder and creative director of dPOP, an interior design firm in Detroit that’s part of the Quicken Loans family of companies. Gilbert is Detroit’s most prominent and influential cheerleader. With a fortune valued by Forbes at $7.3 billion as of May 27, Gilbert has been buying Detroit real estate at a steady clip since moving Quicken Loans to downtown from the suburbs in 2010. The billionaire owner of the NBA Cleveland Cavaliers and major investor in downtown Detroit real estate is just coming off a big political victory following the Legislature’s passage May 24 of major reforms to Michigan’s no-fault auto insurance law, which Gilbert had advocated.

BUSINESS NEWS J Fiat Chrysler Automobiles NV proposed a merger with Renault SA to create the world’s third-biggest carmaker as manufacturers scramble for scale to tackle an expensive shift to electrification and autonomous driv-

CRAIN’S FILE PHOTO

Quicken Loans Inc. Vice Chairman Bill Emerson says that Dan Gilbert, above, has left his family of companies well prepared to weather his absence as he recovers from a stroke.

Detroit digits A numbers-focused look at last week’s headlines:

$200 million Amount of bonds Mayor Mike Duggan wants to issue for blight removal

280,000

Number of residents welcomed by Detroit Institute of Arts last year

$5 million Delta Dental’s donation toward a playground at Detroit’s west riverfront park

BLOOMBERG

The Jeep Jeepster concept vehicle is seen on display during the 52nd Annual Moab Easter Jeep Safari in Detroit last March.

ing. The transaction would be structured as a 50-50 ownership through a Dutch holding company. Renault shareholders, including the French government, would get an implied premium of about 10 percent. J The world’s largest hair salon company completed one of its largest sales to date with a 190-store acquisition by Birmingham-based private equity firm Vision Growth Partners. The equity firm’s Super C Group LLC purchased the salons from Minneapolis-based salon giant Regis Corp. in a deal signed last month. The addition of the stores — 13 in Michigan and the rest in Ohio — makes Super C Group the largest Supercuts franchise in the Midwest, said Michael Sarafa, managing partner of Vision Growth. Terms of the deal were not disclosed. J Delta Dental of Michigan is donating $5 million toward construction of a 5-acre playground along Detroit’s west riverfront in the Ralph C. Wilson Jr. Centennial Park, where construction is scheduled to begin next year. The Delta Dental Play Garden “is go-

ing to be a game-changer for the families in Detroit and for folks who live in this region,” said Mark Wallace, president and CEO of the Detroit Riverfront Conservancy. J More than 280,000 residents of Wayne, Oakland and Macomb counties visited the Detroit Institute of Arts last year, up about 5,000 from 2017, according to Community Engagement Reports released last week. J Michigan’s congressional delegation will travel to Illinois this summer to see a crucial choke point in a waterway between an Asian carp-infested river and Lake Michigan. Sen. Debbie Stabenow, Rep. Fred Upton and other delegation members announced the trip last Wednesday at the Mackinac Policy Conference. J A hair salon company with locations in Oakland County is swooping into downtown Detroit while the city’s retail prospects continue improving. George Nikollaj, owner of 6 Salon, is planning to open a new 3,900-square-foot store at 1441 Woodward Ave. in September. He said a $600,000 build-out is scheduled to begin in the next two weeks. J The Michigan Animal Rescue League plans to tear down its more than 65-year-old shelter in Pontiac to make room for a $6 million, 15,000-square-foot facility. The new shelter will be three times the size of its current 5,000-square-foot facility at 790 Featherstone St., which is scheduled to be demolished starting this week.

RESTAURANT NEWS J Poke Burri is replacing Le Petit Zinc in the Strathmore Apartments building in Detroit’s Midtown neighborhood. The Atlanta-based sushi restaurant that creates things like sushi pizza, sushi corn dogs and sushi doughnuts in addition to its poke bowls and sushi burritos, is leasing about 900 square feet in the rehabilitated building, said Seven Chan, who co-owns the restaurant along with Ken Yu. J Southfield-based chain Wing Snob, a fairly new player to the chicken wing space, is in rapid expansion mode with plans to open more than 30 locations in Michigan and beyond over the next two years. The small fast-casual chain is quickly picking up steam, securing franchise dealsin markets including Ohio, Texas and Canada, while bringing in an average of 15 franchise inquiries per week.

igh-end golf attire retailer Greyson Clothiers officially opened its doors Wednesday in downtown Detroit, its first step in relocating its home base from New York to Detroit. The store opens ahead of the Rocket Mortgage Classic PGA golf tournament that is set to kick off at the Detroit Golf Club at the end of June. The store, on the ground floor of the First National Building on Woodward Avenue, is Greyson’s only brick-andmortar retail outlet in the U.S. The 3,500-square-foot pop-up, which will run until Aug. 31, will offer Rocket Mortgage Classic-branded clothing, polos, sweaters, outerwear, shorts and trousers, along with accessories and Res Ipsa shoes, which are handmade from vintage Turkish rugs. The Hawthorne, N.Y.-based company plans to move its headquarters to either a building owned by Bedrock LLC or at another location in the city.

“Getting out of the infancy stages was important for us as a company, and now we have the opportunity to really establish ourselves and create a community,” Greyson owner Schaefer Charlie Schaefer said. “This is the beginning.” The space is dotted with vintage, mid-century chairs, artwork and a walnut coffee table, which gives off a living-room style feel. The floors are layered with hides and Turkish rugs. “We’re nimble,” Schaefer said. “We create our own spaces ourselves with our hands and do it all. I had a lot of confidence that with a space like this; we could really do something special.” Schaefer declined to say how much is being invested in the store, or the terms of his agreements with Bedrock and Quicken Loans Inc.

CITY OF OAK PARK

Alexander Bishai plans to open a gastropub at 14691 11 Mile Road in Oak Park in early fall. The restaurant will feature a menu of New American cuisine.

Oak Park’s first gastropub to open later this year O

ak Park is set to get its first gastropub later this year. Oak Park Social LLC, led by Alexander Bishai, received liquor license approval last week after getting a site plan approved earlier this year, the Oakland County city said in a release Tuesday. Bishai, 37, said he has a name for the 2,340-square-foot restaurant at 14691 11 Mile Road, but is not releasing it at this time. He anticipates opening sometime in the early fall. The restaurant will be able to seat 84 indoors, with another 60 people outside and employ 10 people, Bishai said. It will boast a menu of New American cuisine that features unique shareables, a “humungous charcuterie board,” entrées and vegetarian options, according to the release. Menus are expected to be finalized soon. Sunday brunch is also in the plan as is an outdoor dining area with activities. Bishai has not finalized who will be leading the kitchen. The restaurant’s general manager, who Bishai would not name, has 17 years of bar restaurant management and kitchen experience. Bishai will serve in a corporate adminis-

trator role and offer support for city correspondence. The total investment for the restaurant is $600,000, according to Bishai, adding that he is in the process of purchasing the Bishai property. The architecture firm on the project is Shelby Township-based JMP Design & Build Inc., and Bishai is still in the process of locking down a general contractor. Previously, Bishai worked as an engineer in the aerospace, automotive and private military manufacturing industries for nine years. After that, he owned a general contracting business for three years. But Bishai is no stranger to the restaurant business. Growing up, he was exposed to the world of catering through his mother’s Mediterranean gourmet catering business that she has operated for more than 27 years out of Okemos.

HEALTH

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global.cmich.edu 877.268.4636 Central Michigan University is accredited by the Higher Learning Commission (www.hlcommission.org), a regional accreditation agency recognized by the U.S. Department of Education. CMU, an AA/EO institution, strongly and actively strives to increase diversity and provide equal opportunity within its community. CMU does not discriminate against persons based on age, color, disability, ethnicity, familial status, gender, gender expression, gender identity, genetic information, height, marital status, national origin, political persuasion, pregnancy, childbirth or related medical conditions, race, religion, sex, sex-based stereotypes, sexual orientation, transgender status, veteran status, or weight (see http://www.cmich.edu/ocrie). 3788991 5/19