A succession plan four years in the making is now taking shape at MemorialCare.
Barry Arbuckle, who has led the Fountain Valley-based health system as chief executive for more than two decades, is assuming the new role of executive chairman on July 1.
He’s passing the torch to current President Dr. David Kim, who was recruited back to MemorialCare from a rival health system as part of the succession planning.
“In health systems, it’s rather unique,” Arbuckle told the Business Journal. “If you look at a number of them, when it came time to identify a successor to their current CEO, they went outside their organizations. This can work, but it can lengthen the transition period.”
It’s the second leadership change within the MemorialCare system in recent weeks.
Last month, MemorialCare Orange Coast Medical Center announced that Marcia Manker was retiring May 1 as CEO, with longtime Chief Operating Officer Emily Randle succeeding her.
MemorialCare, founded in 1997, operates four hospitals across Southern California, including Orange Coast Medical Center and Saddleback Medical Center in Orange County, as well as another medical center and a children’s and women’s hospital in Long Beach.
The system generates about $3 billion in revenue annually and employs more than 14,000 staff and physicians.
CEO for More Than 20 Years
Arbuckle joined MemorialCare in 1989 and has led the organization for more than two decades.
During his tenure, MemorialCare expanded to four acute care hospitals, more than 200 ambulatory care sites and a network of more than 2,000 primary care and specialist physicians.
“From what was then really more of an aggregation of hospitals, we moved to a hospital system, then decided to embark to become a health system and then an integrated delivery system,” Arbuckle said. “So, all that evolution over the years is really what kept it interesting.”
Arbuckle said one of the biggest pivots for MemorialCare was its 2011 acquisition of Bristol Park Medical Group, along with three other Southern California physician groups. Bristol Park Medical Group had 10 locations in Orange County with more than 90 physicians, including Kim, who was a primary care physician at the time.
The partnership established the MemorialCare Medical Foundation, the physician division of the organization, and provided patients with access to MemorialCare’s four hospitals.
“Here you have what was then Orange County’s biggest primary care group—it had been around for 50 years and an extraordinary reputation—that’s why we thought what a perfect way to start and seed our medical foundation,” Arbuckle said.
Recent changes in healthcare are impacting hospitals all across the U.S., with 50% of rural hospitals operating in the red, many in states that did not expand Medicaid, according to healthcare advisory and analytics firm Chartis.
It’s been impacting MemorialCare, too.
Arbuckle described recent revenue challenges at MemorialCare as declining reimbursement rates are failing to keep up with rising costs of operations.
“Medicare or Medicaid Medi-Cal in California has not seen an increase for years, although healthcare costs keep going up,” Arbuckle said. “The cost of nurses, supplies and drugs keeps going up, so that is making it more and more challenging.”
Healthcare Policy Advocacy Push
Transitioning to the role of executive chairman will allow Arbuckle to focus on advocating for health policy, which he described as becoming “increasingly complex.”
“We think we can have even more impact if I’m allowed to do more of that, so I’ll be focusing a lot more on those items,” Arbuckle said.
Arbuckle has been on the advisory committee of California’s Office of Health Care Affordability since its inception in 2022.
On the federal level, Arbuckle said that some programs that have existed for decades, such as Medicare Advantage, are receiving unfair critiques and that he’s working with a team in Washington, D.C. to help change the narrative.
Arbuckle will also focus on senior care, following MemorialCare’s recent invitation to meet with and provide input to the leadership team of the Centers for Medicare & Medicaid Innovation (CMII).
Created out of the Patient and Protection and Affordable Care Act, CMMI is preparing to launch several key initiatives in January 2027, according to Arbuckle.
A Four-Year Succession Plan
The succession plan was “very thoughtful, well laid out and deliberate by our board,” according to Arbuckle.
Arbuckle said that he and the board discussed who would succeed him in the case of an emergency; however, conversations around a long-term succession plan began four years ago.
Kim, who was a family medicine physician at the time, was nominated in 2012 to join MemorialCare’s Physician Leadership Academy, which pairs a physician with an administrator.
Arbuckle was selected to work with Kim.
“I was a family doc with no aspirations of doing anything except that for my career,” Kim said. “I think it was that year of going to this academy being mentored by Barry that made me think maybe this administrative side of healthcare is something that I could explore.”
From 2012 through 2015, Kim said that he was given increasing responsibility within MemorialCare.
When he received an opportunity to become the medical director at St. Jude Heritage Medical Group, which is affiliated with Providence St. Jude, Arbuckle said that he encouraged him to pursue it.
The two continued to meet every six months for lunch, as they had during the mentor process.
“While we were each leading different organizations, our relationship extended to how we could work together to improve healthcare delivery in Southern California and beyond,” Kim said.
During one of these lunches, Kim asked Arbuckle what advice he had about gaining more experience on the hospital side of a health system, given his extensive experience on the physician side from his time at St. Jude and Providence.
“When I was talking to our board about planning in terms of my succession, it occurred to me that it would be an interesting opportunity for David and MemorialCare,” Arbuckle said.
The Return to MemorialCare
MemorialCare was able to recruit Kim back after about eight years.
The real “trigger” was when Dr. Mark Schafer, CEO of MemorialCare Medical Foundation, unexpectedly retired in 2023, Arbuckle said.
“The idea of bringing David in to serve that role, even though it was a smaller role than what he had at the time, was with the idea that it would give us three to four years to give him increasingly expanded opportunities where he would become my successor,” Arbuckle said.
Kim said that he was torn at first.
“I really enjoyed my previous job, and I was learning a lot, but it was narrower in scope than what was being offered to me here,” he said.
Another compelling factor was getting closer to family, with MemorialCare serving only Southern California, compared to Providence, which operates across seven states in the U.S.
“I thought I had the ability to go back to a regional health system that I like to say is big enough to matter, but small enough to move,” Dr. Kim said.
Two years after his return to MemorialCare, Kim was appointed president of the organization.
New initiatives he’s been working on are beginning to take shape, making this year the “right time” for the announcement, according to Arbuckle.
