What's Mike Fernandez's Encore?

Critical Homecare, says Fernandez, serves 19,000 patients from 65 branches and has before-tax earnings of $43 million. The fourth-largest home infusion provider in the country, the company has better margins than its three larger rivals and is moving toward higher-margin therapies. The four largest providers have only 25% of the total market share, he says, meaning there’s plenty of room to grow.

In an interview, Fernandez is solicitous, self-effacing and relaxed — the antithesis of the driven entrepreneur. “My doctor will tell you that I internalize it,” he smiles. And, he adds, “My personal life has suffered.” A father of five, he shows off a picture of his young son, whom he brought to a business meeting. He loved it when the youngster asked, “What is selling short?” The ringtone on his cell phone is a quack — programmed by one of his children. But the beaming father also is thrice divorced.

Last year, Fernandez’s high school invited him to give the school commencement address at St. Patrick’s Cathedral. He says he usually refuses speech-making but made an exception. “I think it’s good for (students) to see that a guy of mediocre intelligence can get ahead. I’m not that smart, and I made my mistakes, and I almost went broke once, and I had to move in with my parents and I still pushed ahead.” While there, he also came clean to Moroney, who’s now retired, about his ulterior motive for attending the philharmonic. Did any of Moroney’s intended enrichment stick? Fernandez smiles. “After listening to these things for four years, I do like classical music today.”

Healthcare System Rx

“If I had a solution as to what ails the healthcare system in the U.S., I would be the next president — oops! I can’t be, as I was not born here.”

So says (actually, e-mails) Mike Fernandez. But press him for a cure, and he has a few ideas. First, as a private-market guy, he’s not in favor of universal government insurance. “The system obviously is not working right,” he says, but he also notes the long waits in Canada for an MRI, even for tumor cases (a median of 10 weeks, according to the Fraser Institute, an independent research organization). “Our system is still a very good one.”

He favors national reinsurance to cover insurers for customers’ catastrophic conditions. He argues that insurance is so expensive because 20% of cases generate 80% of costs. This pushes up premiums, leading the young and healthy to skip coverage, which in turn leads to the risk pool being distorted by too many ill and old. If government reinsured for the expensive minority of cases, everyday health insurance would drop in cost, leading more healthy people to purchase it and therefore spreading the risk. As a bonus, insurers could concentrate on preventive care, further lowering costs.

One other thought. Even now, “very few go untreated.” Those without insurance may suffer through long waits at a public hospital, but they receive care. Unfortunately, the cost is passed on to taxpayers and insurance-covered patients. “There is a financing mechanism in place to take care of the uninsured, but it’s all screwed up.”

Tags: Miami-Dade, Southwest, Healthcare