An appointment at the largest public healthcare system in the U.S. has created a vacancy at the second-largest, as Los Angeles County Health Agency director Mitchell Katz, MD, has been nominated to take over as president and CEO at NYC Health + Hospitals.

Katz has held his current post since 2010, with his tenure including the county’s response to the expansion of Medicaid and insurance coverage under the Affordable Care Act and the implementation of an electronic health record system, along with erasing the department’s $270 million budget deficit.

“I’m incredibly sad,” he said to the Los Angeles Times. “I love Los Angeles County. It’s been extremely good to me, I’ve had only positive experiences and I’m incredibly proud of how different the Department of Health Services is today than it was seven years ago.”

He faces a greater financial challenge in New York. NYC Health + Hospital has a projected budget deficit of $1.1 billion in 2018 and has already taken steps to reduce costs by cutting 476 positions since the previous president and CEO, Ram Raju, MD, stepped down in Nov. 2016. The system was in the middle of a five-year transition plan to improve its financial position, which has further imperiled by pending cuts to Medicaid Disproportionate Share Hospital (DSH) payments and congressional proposals to reduce Medicaid funding.

Citing Katz’s experience in addressing similar problems in L.A., groups such as the Greater New York Hospital Association and the New York States Nurses Association praised his nomination, as did former healthcare leaders at the federal level.

“It is hard to imagine a healthcare leader better suited to lead NYC Health + Hospitals than Dr. Mitch Katz,” said Cindy Mann, former deputy administrator of the Center for Medicare & Medicaid Services and director of the Center for Medicaid and CHIP Services within CMS during the Obama Administration. “Dr. Katz has an impressive track record for accomplishing real and sustainable change, always grounded by his passion for improving health and health equity for patients and for the community.”

Katz, who was born and raised in Brooklyn, will need approval from the health system’s board before taking over the new role in January. L.A. County said its already begun searching for his replacement.