Save UTMC Letter to UT President Gaber

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Dear President Gaber,

We have read your February 21 letter to Governor DeWine that was a rebuttal to our letter sent to the Governor with copy to you on February 20.  We note that you chose to write the Governor after we brought the UTMC issue to his attention after you did not respond to our December 14, 2019 letter on the same topic. 

We hope to begin a direct dialogue with you as early as possible, given the precarious nature of UTMC finances reported from the last University of Toledo Board meeting, and the increasing concern among the electorate of south Toledo, Perrysburg, Maumee and other nearby regions that rely on UTMC for health care.  Based on the partial, largely unofficial evidence available to us, it is reasonable to conclude that UTMC financial instability is years in the making and, intended or not, due to a combination of willful neglect and harmful decisions. In this context, we seek additional information specified here.

Decline in Revenue

Effect of UTMC Regulations that Restrict Access of Physicians to UTMC

We appreciate that you are taking actions to revise the regulations that currently restrict non-faculty appointed community physicians from joining the UTMC Medical Staff.  We understand that the UTMC Medical Executive Council approved the necessary bylaw change and that the full UTMC medical staff will vote on the change on Tuesday, March 3.  If the change is approved, we hope that you will urge approval by the UT Board.  Clearly, the removal of this restriction is only one step that should be taken to enable and encourage use of UTMC by non-UTP physicians, whether faculty-appointed or not.

 Question:  Was a proposal to remove the restriction on use of UTMC by non-faculty appointed physicians ever presented to the UToledo Board.  If so:

  1. What was the decision and basis for decision?
  2. Did any UT Board members ever recuse themselves from voting on such a proposal on the basis of actual and/or potential conflict of interest  by virtue of previous or current positions with ProMedica’s legal counsel (Schumaker, Loop & Kendrick),  ProMedica affiliate Welltower and HCR ManorCare?  If so, please provide a complete list of such instances.

Effect of UT Board Decisions that Restrict Budget for UTMC Marketing and Capital Improvements

The marketing budget of $1 million/year that you reported in your letter is substantially lower than the value that would be typical for a hospital with about $300 million/year revenue.  This market budget amounts to 0.33% of revenue which is 3-10 times lower than the typical 1-3%.  Further, the capital improvements budget was <0.5% of revenue, also far lower than recommended.  These observations lead to the following question and request:

Question: Have any UT Board members ever recused themselves from decisions regarding UTMC marketing and capital expenditures budget decisions on the basis of actual and/or potential conflict of interest  by virtue of previous or current positions with ProMedica’s legal counsel (Schumaker, Loop & Kendrick),  ProMedica affiliate Welltower and HCR ManorCare?  If so, please provide a complete list of such instances?

Request: Please provide a copy of marketing plans over the last five years for UTMC, Dana Cancer Center, and other HSC clinical facilities, and an accounting of the costs and measured impacts, and please report whether the marketing plans met their objectives.

Uninformative/Unclear Financial Statements

You provided UTMC financial data (Figure labeled: “UTMC Historical Financial Loss”) to support the assertion that UTMC was losing money at the time of the affiliation and has not significantly worsened over the time of the affiliation.  Importantly, it is unclear whether UTMC budgetary losses between 2015 and 2019 were based on operating income and losses.  In this context, we note that for many years the annual UTMC overhead costs (e.g. human relations, information technology, legal services, and security) as a fraction of annual revenue have been much higher than observed at other comparable hospitals. We conclude that since the merger between UT and MCO, UTMC solvency has been continuously threatened by extraordinary non-UTMC overhead expenses. 

Questions:

  1. Why are the annual costs for HR, IT, legal services, and security costs for UTMC much higher than typical for a hospital with similar annual revenue?
  2. Were UTMC operations balanced or even in the black in 2015 (i.e., at the time the   Affiliation Agreement was initiated) and was a significant fraction of the losses for FY 2015-2019 presented in your graph due to transfer of funds from UTMC to cover overhead costs in other UT departments? 
  3. If UTMC overhead costs were higher than other comparable hospitals:
    1. was the UT Board made aware of this, and if so, what rationale was provided?
    2. was it recognized that the use of UTMC operating income for non-UTMC overhead was harmful to the future of UTMC?
  4. Have any UT Board members ever recused themselves from decisions regarding use of UTMC operating income to cover overhead in other areas of UT on the basis of actual and/or potential conflict of interest  by virtue of previous or current positions with ProMedica’s legal counsel (Schumaker, Loop & Kendrick),  ProMedica affiliate Welltower and HCR ManorCare?  If so, please provide a complete list of such instances?
  5. Was there any consideration at the time of the affiliation that governance of UTMC, which was in direct competition with ProMedica hospitals, should be separated from that of COMLS, which was closely affiliated with ProMedica?

Financial Projections

You report that you are thoroughly examining UTMC’s operations and services in the context of economic realities in the current healthcare environment.  We urge you to reassess FY2021 and following year projections after taking the following steps:

  1. Remove regulations that restrict community physicians from using UTMC.
  2. Prepare projections that model a significant increase in UTMC clinical activity based on physicians newly credentialled over the next year, starting with the fourth quarter of this year (April-June), and increasing through FY 2021.
  3. Cease diversion of UTMC operational income to support non-UTMC and non-COMLS overhead.
  4. Re-allocate funds previously diverted to non-UTMC department overhead; use them to increase marketing and capital improvement funds in FY 2021 UTMC budget to to levels commensurate with other hospitals (i.e. >1%).
  5. Establish a marketing plan with measurable benchmarks.
  6. Review governance of UTMC to eliminate conflicts of interest on part of UT Board and/or UTMC administration.

Effect of Affiliation on COMLS

From the standpoint of many Toledo citizens and elected officials that represent them there were many reasons to applaud the vision of the Affiliation, and there is evidence that many of the anticipated benefits are being realized.  Through Affiliation support UT COMLS now provides increased training opportunities for medical students and should enable increased recruitment and retention of medical talent in our region.   However, there are serious concerns that need to be addressed head on.

  1. Concerns regarding current and potential for conflict of interest associated with governance of COMLS, UTP, and UTMC by the same person in the context of the Affiliation (as specified above).
  • Lack of a clearly articulated strategic plan to improve the ranking of COMLS.  A key goal of the signed Affiliation Agreement is to increase the ranking of the UT COLMS among medical schools.  We have been unable to identify public information regarding an Affiliation strategic plan to achieve this goal.  The generally recognized medical school ranking system was developed by US News &World Report.  Using the USN&WR methodology, medical schools may be ranked according to a “primary care” model or a “research” model.  At the time of affiliation, UT COMLS was in fourth quartile according to both of these ranking systems and that is where it remains today. 

Importantly, if the Affiliated partners share a goal to increase ranking according to the “research” model it is key to focus on NIH funding.  USN&WR states that, “NIH funding is viewed as the most verifiable and credible measure of medical school research”.   This is why we specified the decline in NIH-funding to UT COMLS as a metric for lack of success.  In contrast, College of Medicine & Life Sciences Research dollars displayed in the figure that you provided is an inappropriate ranking metric.

In this context, we are concerned regarding absence of a clearly articulated plan to increase COMLS ranking according to the USN&WR methodology that is enthusiastically supported by, and committed to, by both Promedica and COMLS.  Further, there is concern that the recent Promedica acquisition of >$1 billion in debt and reported >$100 million/year negative operations budget has prevented, and will continue to prevent, Promedica from fulfilling its obligation to this goal.

Questions:

  1. In FY 2015-2019, what is total amount of COMLS expenditure of funds provided by Promedica for:
    1. Salaries and start-up support of NIH-funded research faculty currently employed by COMLS?
    2. Research equipment available to COMLS NIH-funded faculty?
    3. Remodeling of research labs currently occupied by NIH-funded investigators in Block Health Sciences and Health Education Buildings?
  2. How does the total amount of money reported in answer to question 1 compare to the total amount of money expended by COMLS for same costs in the prior five years (e.g. 2010-2014)?
  3. How much money is budgeted by Promedica and COMLS for the costs specified in questions 1a-c for FY2021?

The questions we addressed to you in this letter and our letter from December, 2019 deserve a response with candid and direct answers.  We look forward to such a response within seven business days.  Otherwise, we will continue to seek assistance from the Governor and state legislators. 

Thank you very much for your time and consideration.