Paul Castillo selected as new chief financial officer for U-M Health System

Michigan native leaves Pittsburgh’s top hospital to help UMHS grow and strengthen strategically during challenging times

A Michigan native who has helped lead Pittsburgh’s top hospital will soon return to his home state as the chief financial officer for Michigan’s top health care institution, the University of Michigan Health System. The appointment is pending the approval of the U-M Board of Regents.

Paul Castillo, who will take his new post on November 7, will help guide UMHS through its strategic efforts to grow and become even more financially sound despite the current economic challenges faced by all health care institutions.

Castillo is currently the chief financial officer and vice president of finance at UPMC Presbyterian Shadyside, the flagship hospital of the health system associated with the University of Pittsburgh. He was integrally involved in the merger of two top UPMC hospitals – Shadyside and Presbyterian – which created a clinical enterprise with a $1.9 billion operating budget. He has risen through the financial ranks at UPMC since 1996.

A Detroit native and graduate of Michigan State University, Castillo will now oversee the U-M Health System’s integrated financial operations. That includes the $2 billion operating budget of the U-M Hospitals and Health Centers, the $1.2 billion budget of the Medical School, the clinical services of the U-M School of Nursing, a shared administrative services division and the Michigan Health Corporation, the legal entity that allows UMHS to enter partnerships.

“I am delighted to bring Paul back to Michigan so that his expertise and experience can guide our path forward,” says Ora Hirsch Pescovitz, M.D., U-M executive vice president for medical affairs and CEO of the U-M Health System. “As we continue our strategic efforts to grow, become more efficient and fuel the innovation that will create the future of health care, Paul’s acumen will be a vital factor in our success.”

Pescovitz also offers high praise for Robin Damschroder, MHSA, who has led the recently integrated UMHS financial services division since February after serving as Controller since 2007. “Robin’s ability to step into the interim CFO role without skipping a beat and guide us through a year of many changes and challenges are testament to her skill and dedication to our institution,” Pescovitz says.

Damschroder will now become associate director for operations and clinical services. She was selected for that role this spring by Tony Denton, executive director of university hospitals and chief operating officer of UMHHC.

Pescovitz also offers thanks to the internal CFO search committee, which was ably chaired by U-M Hospitals and Health Centers CEO Doug Strong and included leaders from around U-M: Maria Ceo, Deborah Childs, Tony Denton, Margaret Gyetko, Jay Hess, Benjie Johnson, Timothy Slottow, Quinta Vreede, Andrew Zukowski and staff members Safia Al-Kharsa and Natasha Arnold.

In the past year, UMHS has shifted to a more integrated financial accounting system that will allow for better strategic planning in the future. In the next year, it will begin the multi-year process of implementing MiChart, an entirely new system for managing data from clinical care and clinical revenue.

At the same time, UMHS has embarked on several partnerships with hospitals and physician groups statewide, and is preparing for the opening of a major new inpatient and outpatient facility for children’s and women’s care late this fall. It is also preparing for the advent of state and federal changes that have major financial ramifications, including the Accountable Care Organization model of care, possible reductions to federal medical research funding, and continuing challenges to the state budget that may lead to reductions in revenue for several areas of UMHS.

Under Pescovitz’s leadership, UMHS has recently completed the first phase of a strategic planning process that will guide the institution’s future. Castillo’s arrival comes just as UMHS begins to implement specific strategic initiatives spawned by this process.

“Paul could not be joining us at a better time, and I look forward to having his fresh insights and the perspective he brings from another major integrated academic medical center,” says Pescovitz.

Among his achievements at UPMC, Castillo was a leader in implementing changes to health information systems, negotiating major contracts, assisting in physician recruitment and retention efforts, and developing financial analysis tools.

Before taking on his role at UPMC Shadyside, Castillo held top financial posts in the UPMC Community Medicine physician group, UPMC Corporate Services, and UPMC Mckeesport Hospital, which he helped guide through its process of becoming part of UPMC. In the early 1990s, he was vice president of finance at Saint Vincent Health System in Erie, PA, which he joined after more than a decade with the Arthur Andersen accounting firm.

Castillo will be accompanied by his wife and three daughters. His parents live in the metro Detroit area.

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