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New director of Hernando County Health Department welcomes budget challenge

SPRING HILL — Don't call Phil Spence a fixer.

To give the new Hernando County Health Department administrator that label, Spence said, would imply the agency is somehow broken. That's far from the case, he said.

The department just moved into a huge, beautiful new building on Forest Oaks Boulevard that is staffed by dedicated employees, Spence said.

"There is a cadre of good solid people here, and they're eager to do whatever has to be done to make the Health Department successful," Spence said. "But it is no secret that there is some financial … ."

He paused for a moment.

"There is work that has to be done to make the department more financially viable."

The department's budget for the current year, about $7 million, is a quarter of a percent in the red. The reserve fund is empty. And Spence's predecessor, Elizabeth Callaghan, was forced to lay off 10 people last fall.

The department has suffered financial hits on several fronts in recent years. Medicare reimbursements and state and federal funding continue to decrease while the county's high unemployment rate drives more residents to seek services priced on a sliding income scale.

Though Spence doesn't want to be called a fixer, he has developed a reputation for running tight ships at health departments throughout the state. His former mentor — a man who spent years working at the Hernando department — tapped him in large part because of that.

"Hernando is challenged somewhat on the business side of public health, and that's Phil's area of expertise," said Michael Sentman, the state's assistant deputy secretary for health.

Spence's task is to nudge the reserve fund to at least 6.5 percent of the total budget, Sentman said.

"Hopefully without adversely affecting staff," he said, "and still providing the necessary services to the community."

• • •

Spence took an unlikely path to a career in public health. A remark about his diverse, impressive resume draws a smile and a quip.

"What it really means is I'm not sure what I want to be when I grow up," the 64-year-old St. Petersburg resident said in a recent interview with the Tampa Bay Times.

Spence had yet to finish hanging art in his new office. On the floor nearby sat a framed photo of him crossing the finish line at the 1986 New York Marathon.

Born in Chadwell Heath, England, Spence was 12 years old when he emigrated with his parents and brother to Scranton, Pa. He was not yet a citizen when he turned 18 and got a draft notice. He decided to enlist in the U.S. Army.

Spence served as an infantry platoon leader during his first tour in Vietnam, earning a Purple Heart and a Bronze Star. He completed flight school and did a second tour as a helicopter pilot, aviation liaison officer and unit commander, earning a second Bronze Star and a host of air medals and other awards.

Spence earned a bachelor's degree from the University of Scranton while flying helicopters for the National Guard, then went back into the Army. He would later earn two master's degrees.

As a national senior security fellow at the Kennedy School of Government at Harvard University, he researched the role of the military in the drug war. He then took an assignment at the Pentagon, where he started a program to provide military resources to federal, state and local law enforcement agencies to support drug interdiction efforts.

His last role was a chief of staff for the Army National Guard headquarters, where he oversaw 1,100 employees and a budget of more than $5 billion.

Spence retired from the Army in 1996 at the rank of colonel, sold his house in Northern Virginia, bought a 42-foot cabin cruiser and spent 72 days with his wife, Sandy, cruising south on the Intracoastal Waterway. While living on the boat in Punta Gorda, Spence tried yacht brokering and substitute teaching before heading back to Washington to do military and security consulting work. A few years later, the Spences headed to Florida again, this time on a different boat.

After working for a year as director of a nonprofit organization that helped secure resources for homeless veterans, Spence was ready for another change.

"I decided I needed to get back into government work because that seemed to be what I was best at," he said.

He landed a job in 2003 as administrative services director at the Highlands County Health Department.

"As administrative services director, you become the No. 2 person, whether it's official or not," he said. "You have a knowledge and understanding of the entire department."

At the time, Sentman held the same post in Hernando, and Spence came here for a week to shadow the more experienced administrator. The following year, Spence got a trial by wind and rain as hurricanes tore across the state.

In 2006, Spence became administrative services director at the Manatee Health Department, spending a year there before moving to the same role in Seminole County. He was promoted to assistant director in 2009. While there, he started the department's conversion to an electronic records system and oversaw major renovations of the immunization and dental wings.

Last October, Sentman asked Spence to spend a couple of weeks in Franklin County to stand in for the director, evaluate the department's financial condition and offer some ideas for improvement.

Spence was still in Franklin when Sentman called again, this time with an assignment in Hernando. Callaghan, who was approaching 30 years as a public employee, had already announced her retirement.

Spence asked if he would be in Hernando a short time, too.

Permanently, Sentman replied, asking Spence to take a weekend to think about the offer.

He started Nov. 30, officially in an interim capacity because while Callaghan had left, her retirement didn't officially take effect until last week.

"I love a challenge," Spence said.

• • •

Last fall, after serving as Hernando's director for 18 years, Callaghan was about to achieve her final goal, one that had been years in the making: move the department's Spring Hill operations into the new, 57,000-square-foot building on Forest Oaks Boulevard.

The $14 million for construction came from a separate state capital fund. It had taken nearly a decade for the local department to secure the money.

Just days before staffers were to start moving in, Callaghan announced the 10 layoffs. They extended to all areas of the department and included positions in primary health care, purchasing, health education, transportation and clerical work.

In an interview last week, Callaghan said she put off those layoffs for as long as she could, and that she was confident she made the decision at the right time.

"This was the year that we had done everything we could think of to increase our efficiencies and it was a time we needed to go ahead and make that change," Callaghan said.

The downsizing, which also involved shuffling employees to other areas of the department, was strategically planned to minimize the effects on services that are crucial to public health, she said.

About half of the budget is generated locally, mainly by billing Medicare, Medicaid and private insurers. The department this budget year got roughly $1.6 million from the state and about $780,000 from local property taxes. Grant funding, another key component of the budget, has dwindled in recent years.

The department currently has 94 full-time employees and 23 part-time workers in Brooksville and Spring Hill. On Friday, Spence said he was "cautiously optimistic" that the department will stave off more layoffs, at least in the short term. He hopes to look for ways to make the paperwork side more efficient.

"My philosophy is we don't pay a doctor to do a lot of administrative stuff if we can help it," he said.

But he also acknowledged that services will likely be "adjusted," though he said it's too early to offer specifics. He said he has started to work on a corrective action plan, required by the state, to put the budget back in the black.

Services offered to nonpaying clients could be affected, he acknowledged.

"No health department can survive if all of their patients are no-pay and uninsured," he said. "There has to be a delicate balance."

Could that mean turning some clients away?

"I hope not," he replied.

For years, one of the Health Department's strengths has been its partnerships in the public and private sectors, from local hospitals and health providers to local governments, Callaghan said.

Spence has already started meeting with those partners — "making sure we're all working together synergistically to maximize the limited resources we all have, and that we're not providing redundant services," he said.

"I've been encouraged by the reception that I've received."

Tony Marrero can be reached at (352) 848-1431 or

Philip "Phil" Spence

Age: 64

Hometown: Chadwell Heath, England

Resides: St. Petersburg

Career highlights: Spent 31 years in the U.S. Army, retiring in 1996 at the rank of colonel. Has served as administrative services director at the Highlands, Manatee and Seminole health departments. Promoted in 2009 to Seminole's assistant director post.

Education: Bachelor's degree in management from the University of Scranton; two master's degrees, one in public affairs from Indiana University of Pennsylvania, the other in management and human resources development from Webster University.

New director of Hernando County Health Department welcomes budget challenge 01/21/12 [Last modified: Saturday, January 21, 2012 12:52pm]
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