healthy4u: academic medical centers

Finally, An Article in a Large Circulation Medical Journal with Systematic Data about Leaders of Academic Medicine Conflicted by their Service on Health Care Corporate Boards

Background - a New Species of Conflict of Interest Since <a href="http://hcrenewal.blogspot.com/2006/03/new-species-of-conflict-of-interest-in.html">2006</a>, we have posted repeatedly about  what was then a new species of severe <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">conflicts of interest</a>.  This occurs when leaders of academic medical institutions or other health care non-profit organizations or non-governmental organizations (NGOs) also serve as members of <a href="http://hcrenewal.blogspot.com/search/label/boards%20of%20directors">boards of directors</a> of for-profit corporations  whose products and actions have major effects on health care. Most recently, we <a href="http://hcrenewal.blogspot.com/2014/03/american-board-of-internal-medicine.html">discussed </a>the cases of the current CEO of the National Quality Forum and past CEO of the American Board of Internal Medicine who was found to be on the board of for-profit hospital group purchasing organization Premier Inc, and had been on the board of its privately held but for-profit predecessors.  We then <a href="http://hcrenewal.blogspot.com/2014/02/incoming-president-of-iom-outed-as.html">discussed</a> the case of the incoming president of the US Institute of Medicine and former Chancellor of Health Affairs at Duke University who was on the boards of Alnylam Pharmaceuticals, Medtronic and Pepsico.  We next <a href="http://hcrenewal.blogspot.com/2014/03/turnabout-is-fair-play-why-university.html">discussed</a> the case of the current Dean of medicine at the University of Illinois who is on the board of Novartis.  We also recently <a href="http://hcrenewal.blogspot.com/2014/03/better-late-than-never-jama-article.html">posted</a> about the first time these sorts of severe conflicts of interest issue have been addressed in a large circulation medical journal.  A commentary in JAMA called for many such conflicts to be banned. A Small Study of the Prevalence of a New Species of Conflict of Interest Now JAMA has just published a research letter which examined the prevalence of board members of large, for-profit, publicly held pharmaceutical companies who also were among the leadership of academic medical centers. [Anderson TS, Dave S, Good CB et al. Academic medical center leadership on pharmaceutical company boards of directors.  JAMA 2014; 311: 1353-5.  Link <a href="http://jama.jamanetwork.com/article.aspx?articleid=1853147">here</a>.] The authors looked at public data about 2012 board membership of the 47 biggest publicly held companies based on global prescription drug sales. They tabulated those who were also leaders at (apparently only US) academic medical centers.  The most important findings were: - 19/47 companies (40%) had at least one board member who was a leader of an academic medical center (AMC) - 16/17 US based companies had at least one board member who was also a leader of a US AMC -  pharmaceutical company board members included 2 university presidents, 6 deans of medicine, 6 hospital or health system executives, 7 clinical department chairs or center directors -  28 board members were also members of boards of trustees or directors of US hospitals, medical schools, or their parent universities. Comments We have been trying to raise awareness of this issue since 2006.  Now we have some idea of the size of the problem. Keep in mind that this study did not attempt to determine the prevalence of academic medical center leaders on boards of smaller pharmaceutical companies, privately held companies, biotechnology or device companies, or other health care and health care related companies (e.g., for-profit hospital systems, health insurance companies, for-profit contract research organizations, for-profit medical education and communication companies, large companies with major health care components, etc, etc, etc)  It also did not attempt to determine the prevalence of leaders of other important health care non-profit organizations (e.g., hospitals and hospital systems, insurance companies, professional societies, patient advocacy groups, accrediting boards, etc, etc, etc) on health care or related corporate boards.  It also did not address leaders of health care organizations outside of the US.  So this study likely greatly underestimates the overall prevalence of and the number of people involved in what we first called a "new species of conflict of interest." But it is a start.  And publishing it in JAMA will begin to make more health care professionals, policy makers, and researchers, and more of the public at large aware of the problem. As I said before, it is very nice to see that the issue of what we once called a new species of conflict of interest finally has made the big time.  Whether it now gets any more traction remains to be seen.  Unfortunately, since conflicts of interest can be so profitable for the directly affected parties, I fully expect they will continue to oppose any restrictions.  The money they have made will likely be used to deploy marketing and public relations personnel and legal counsel to counter any attempts to try to make this aspect of health care more honest. As we have said again and again, the web of conflicts of interest that is pervasive in medicine and health care is now threatening to strangle medicine and health care.  Furthermore, this web is now strong enough to have effectively transformed US health care into an oligarchy or plutocracy.  Health care is effectively run by a relatively small group of people, mainly professional managers plus a few (lapsed?) health care professionals, who simultaneously run or influence multiple corporations and organizations. For patients and the public to trust health care professionals and health care organizations, they need to know that these individuals and organizations are putting patients' and the public's health ahead of private gain. Health care professionals who care for patients, those who teach about medicine and health care, clinical researchers, and those who make medical and health care policy should do so free from conflicts of interest that might inhibit their abilities to put patients and the public's health first. Health care professionals ought to make it their highest priority to ensure that the organizations for which they work, or with which they interact also put patients' and the public's health ahead of private gain, especially the private gain of the organizations' leaders and their cronies. ADDENDUM (3 April, 2014) - see also comments by Paul Levy <a href="http://runningahospital.blogspot.com/2014/04/how-not-to-set-example.html">on the Not Running a Hospital blog</a>, <a href="http://1boringoldman.com/index.php/2014/04/01/at-first-glance/">on the 1BoringOldMan blog</a>, and by Ed Silverman (welcome back!) on <a href="http://blogs.wsj.com/corporate-intelligence/2014/04/01/why-people-who-influence-reseach-are-popular-in-pharma-boardrooms/">the WSJ Corporate Intelligence blog</a>.

Finally, An Article in a Large Circulation Medical Journal with Systematic Data about Leaders of Academic Medicine Conflicted by their Service on Health Care Corporate Boards

Background - a New Species of Conflict of Interest Since 2006, we have posted repeatedly about what was then a new species of severe conflicts of interest. This occurs when leaders of academic med…

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03 Apr 2014

Better Late than Never - JAMA Article Advocates Banning Academic Medical Leaders from Serving on Many Health Care Corporate Boards

Will wonders never cease? Eight years after we started posting about this issue, it has made it into a large circulation medical journal, albeit not completely A JAMA Commentary Decries Leaders of Academic Medical Centers Serving on Boards of Organizations with Conflicting Priorities A recent JAMA commentary(1) noted the importance of conflicts of interest affecting top leaders of academic medicine, <blockquote class="tr_bq">Conflict of interest is particularly relevant for those in the upper echelons of academic health system leadership—presidents, vice presidents, provosts, deans, chief executive officers, and the senior administrators who report to them. </blockquote> (The article oddly omitted discussing conflicts of interest affecting the boards of trustees of such institutions, who are charged with their stewardship.) Anyway, the authors' rationale was that, <blockquote class="tr_bq">Unlike most faculty and staff, senior institutional officials are involved in financial and business decisions, including purchasing, resource allocation, and development of corporate partnerships, and have fiduciary responsibility to the entire institution. In addition, it is critical that the public, students, employees, and faculty maintain confidence in the integrity of institutional leaders. Leaders have a responsibility to set an example for others in their institution, especially for those training to be health care professionals. Independence and integrity of judgment are core precepts of professionalism. Every employee, faculty member, and student in an academic health system should feel confident that their leaders are making decisions based on the best interests of the institution and not driven by biases secondary to financial connections to outside corporate entities. </blockquote> So, <blockquote class="tr_bq">Having a fiduciary responsibility to 2 separate entities is at best a very difficult situation. Will the leader direct business inappropriately to the outside company on whose board he or she sits? Will the leader inappropriately use information about the institution he or she leads to influence decisions by the outside corporation? It is difficult to separate these types of activities and decisions. In addition, there are administrative costs associated with the management of this level of conflict, and such relationships might have a 'chilling effect' on other companies that could do business with the academic health system. Beyond service on fiduciary boards, undertaking any paid role (consulting, participation on advisory boards, etc) with an outside entity with interests that overlap those of the leader’s institution raises the same issues. </blockquote> The authors stressed that the most intense conflicts are generated by service on the boards of directors of "organizations with interests that overlap those of the academic health system."  Presumably they would have included among such organizations health care corporations that sell goods or services that might be used within academic medical centers, and/or be the subject of teaching or research by faculty at these centers, although the article did not make that explicit. The authors suggested such conflicts are not infrequent, noting a survey by Campbell et al of department chairs in academic medical institutions that showed a majority had some sort of relationships with industry, although they did not specify what these relationships were.  In fact, the Campbell article did report that 11% of department chairs admitted to being on the board of directors of companies that had activities that related to the chairs' academic or administrative responsibilities.(2) Finally, the authors called for banning most such conflicts <blockquote class="tr_bq">the fiduciary responsibilities of presidents, provosts, vice presidents, deans, chief executive officers, and those who report to them should preclude a paid relationship with an outside entity in related and relevant areas,...  </blockquote> Note however that they did offer some loopholes. <blockquote class="tr_bq">unless a case can be made that there is a compelling institutional interest in the leader’s service in such a role, or if the role with the outside organization is outside the scope of the leader’s role at the academic health system.</blockquote> Despite the omissions and loopholes, this is a very significant article.  It is the first challenge to such severe conflicts of interest affecting academic medicine to appear as an article in a major medical journal, at least to my knowledge.  You Heard It Here First However, on Health Care Renewal we have been attempting to challenge such conflicts for at least eight years. In 2006 we first <a href="http://hcrenewal.blogspot.com/2006/03/new-species-of-conflict-of-interest-in.html">discussed</a> a newly discovered species of conflict of interest in health care, in which leaders of medical or health care organizations were simultaneously serving on boards of directors of health care corporations. We posited these conflicts would be particularly important because being on the board of directors entails not just a financial incentive.  It ostensibly requires board members to "demonstrate unyielding loyalty to the company's shareholders" [Per Monks RAG, Minow N. <a href="http://www.amazon.com/Corporate-Governance-Robert-G-Monks/dp/1405116986">Corporate Governance</a>, 3rd edition. Malden, MA: Blackwell Publishing, 2004. P.200.]  Of course, after the global financial collapse of 2008 made us sadder and a little wiser, we realized that many board members actually seem to have unyielding loyalty to their cronies among top management.  However, in any case, the stated or actual interests of a member of the board of a health care corporation, like a pharmaceutical company or medical device company, could be very different and at odds with the mission of an academic medical institution or a non-profit ostensibly dedicated to improving health care quality. Vivid Cases Would Strengthen the Argument It is odd that the JAMA article included very little evidence about the occurrence of such conflicts of interest.  It really is not hard to find.  Since 2006, we have discussed numerous cases of such conflicts of interest. The case that first attracted <a href="http://hcrenewal.blogspot.com/2006/01/california-nightmares-more-troubles-at.html">our attention</a> was that of Marye Anne Fox, the then Chancellor of the University of California - San Diego, a major campus of the state university that includes a medical school.  January, 2006 media reports noted that Chancellor Fox was simultaneously servingon 10 corporate boards, including those of two health care corporations, Boston Scientific, a medical device company, and Pharmaceutical Product Development Inc (PPDI), a for-profit contract research organization.  At the time, I wrote, <blockquote class="tr_bq">having ultimate leadership responsibilities for a medical school and medical center, while also having ultimate fiduciary responsibilities for the management of a medical device company and a contract medical research company amounts to the biggest conflicts of interest I have ever seen.   </blockquote> Nonetheless, beyond local media, the case got little attention at the time.  What attention it did get focused on the magnitude of Chancellor Fox's commitments to outside organizations, not the conflicts they apparently caused (look <a href="http://hcrenewal.blogspot.com/2006/02/academic-medical-leaders-as-corporate.html">here</a>).  Chancellor Fox apparently retired from the PPDI board in 2008 (look <a href="http://www.grace.com/about/leadership/BoardOfDirectors.aspx">here</a>) but did not retire from the Boston Scientific Board until 2011 (look <a href="http://www.massdevice.com/news/boston-scientific-co-founder-john-abele-leave-board">here</a>).  Since then, we found many more striking cases. -  A month later, there was the <a href="http://hcrenewal.blogspot.com/2006/02/tale-of-three-ironies-university-of.html">case</a> of the president of the University of Miami, a board member of for-profit health insurance company UnitedHealth, whose lowest paid employees were on strike to protest their lack of health insurance, among other issues. -  It turned out the UnitedHealth board in particular seemed to be a refuge for multiple academic leaders, at least one of whom seemed partly responsible for allowing the then UnitedHealth CEO to collect many backdated stock options (look <a href="http://hcrenewal.blogspot.com/2006/08/more-entangled-web-unitedhealth-case.html">here</a>).. -  Then there was the 2008 case of the conflict of interest involving an anti-health company.  After Virginia Commonwealth University was criticized for taking money from giant tobacco company Philip Morris for medical research, it turned out that the then president of the university, Eugene Trani, was on the board of another tobacco company, Universal Corp (see post <a href="http://hcrenewal.blogspot.com/2008/05/worse-variant-of-new-species-of.html">here</a>). -  Then, in 2009, some attributed the problems at George Washington University's medical school that caused it to be put on probation to the conflict of interest of its provost and vice president for health affairs, John F Williams, who also sat on the board of Universal Health Services, which owned the university hospital (look <a href="http://hcrenewal.blogspot.com/2009/02/conflicts-of-interest-and-george.html">here</a>).  We posted about a number of other colorful cases since then (look <a href="http://hcrenewal.blogspot.com/search/label/boards%20of%20directors">here</a>) Although this evidence is admittedly case based and therefore anecdotal, it could be used to highlight the importance of the problem and develop support for its solution. A Welcome Addition to Previous Recommendations about Countering Conflicts of Interest For whatever reason, this issue somehow seemed to escape the attention of many of those who have written about conflicts of interest in health care.  Even those who advocated taking a harder line on conflicts of interest have generally avoided this issue. Brennan et al made recommendations about reducing conflicts of interest in 2006, but focused on students and faculty, not top leaders and executives (see post <a href="http://hcrenewal.blogspot.com/2006/02/academic-medical-leaders-as-corporate.html">here</a>).(3)  The 2009 <a href="http://www.iom.edu/Activities/Workforce/ConflictOfInterest.aspx">Institute of Medicine report</a> set relatively tough standards for managing conflicts of interest affecting clinical research and teaching, which unfortunately since have largely been ignored.  It did call for senior institutional officials to disclose their conflicts of interest, and for institutional boards of trustees to form conflicts of interest committees that would exclude conflicted individuals, but otherwise did not address conflicts of interest affecting academic leaders or institutional trustees.  The 2013 <a href="http://www.pewhealth.org/reports-analysis/reports/conflicts-of-interest-policies-for-academic-medical-centers-85899514090">Pew Charitable Trusts Conflicts-of-Interest Policies for Academic Medical Centers </a>suggested restrictions on conflicts affecting faculty, trainees, and students, but again did not mention senior institutional leaders or boards of trustees. Conclusion So it is very nice to see that the issue of what we once called a new species of conflict of interest finally has made the big time.  Whether it now gets any traction remains to be seen.  Unfortunately, since conflicts of interest can be so profitable for the directly affected parties, I fully expect they will continue to oppose any restrictions.  The money they have made will likely be used to deploy marketing and public relations personnel and legal counsel to counter any attempts to try to make this aspect of health care more honest. As we have said again and again, the web of conflicts of interest that is pervasive in medicine and health care is now threatening to strangle medicine and health care.  For patients and the public to trust health care professionals and health care organizations, they need to know that these individuals and organizations are putting patients' and the public's health ahead of private gain. Health care professionals who care for patients, those who teach about medicine and health care, clinical researchers, and those who make medical and health care policy should do so free from conflicts of interest that might inhibit their abilities to put patients and the public's health first.  References 1. Pisano ED, Golden RN,Schweitzer L. Conflict of interest policies for academic health system leaders who work with outside corporations.  JAMA 2014;311(11):1111-1112. doi:10.1001/jama.2014.788  Link <a href="https://jama.jamanetwork.com/article.aspx?articleid=1841978">here</a>. 2.  Campbell EG, Weissman JS, Ehringhaus S et al.  Institutional academic-industry relationships.  JAMA 2007;298(15):1779-1786. doi:10.1001/jama.298.15.1779.  Link <a href="http://jama.jamanetwork.com/article.aspx?articleid=209192">here</a>. 3,  Brennan TA, Rothman DJ, Blank L et al.  Health industry practices that create conflicts of interest.  a policy proposal for academic medical centers.  JAMA  2006;295(4):429-433. doi:10.1001/jama.295.4.429  Link <a href="http://jama.jamanetwork.com/article.aspx?articleid=202261">here</a>.

Better Late than Never - JAMA Article Advocates Banning Academic Medical Leaders from Serving on Many Health Care Corporate Boards

Will wonders never cease? Eight years after we started posting about this issue, it has made it into a large circulation medical journal, albeit not completelyA JAMA Commentary Decries Leaders of Acad…

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20 Mar 2014

Non-Profit Hospital Executive Salaries Continue to Defy Gravity and Logic

The old saying is that nothing is certain except death and taxes.  In health care, the other near certainty seems to be that compensation for health care leaders is big and always getting bigger.  Over the past few weeks several reports about the compensation of top executives of US non-profit hospitals and hospital systems have appeared.  So it is time to do our latest round-up of incessantly buoyant hospital executive compensation, and argumentative hot air that seems to fuel it.  I will first summarize the latest cases in alphabetical order by state, and then examine some common justifications for the seemingly anti gravitational nature of executive compensation in this part of health care. Arizona On AZCentral.com was an <a href="http://www.azcentral.com/news/politics/articles/20130208maricopa-county-health-care-chief-big-raise.html">article</a> about the CEO of a single relatively small public hospital system: <blockquote class="tr_bq">The leaders of Maricopa County’s public health-care system agreed to raise chief executive Betsey Bayless’ pay by 33 percent, bringing her salary to $500,000.</blockquote> That may not seem like a lot of money as executive compensation goes, but consider the context: <blockquote class="tr_bq">The Maricopa Integrated Health System is a public hospital system that provides care for the Valley’s poor and uninsured. It is funded by federal and state health-care dollars and a special county levy paid by all county property-tax payers. MIHS budgeted $3.5 million for market adjustments and merit raises for its employees in fiscal 2013. Bayless’ salary increase alone will consume one-quarter of the $500,000 the board had allocated this fiscal year to bring all employees’ pay in line with similar positions elsewhere. The health-care system’s rank-and-file employees have received annual merit-based salary increases of no more than 2.9 percent since fiscal 2008.</blockquote> Nonetheless, the CEO did not exactly feel rich: <blockquote class="tr_bq">Bayless said she did not request the raise and was not expecting it. She said she believes MIHS employees will understand that her salary has been comparatively low and that her replacement likely will be brought in at an even higher salary.</blockquote> She justified her pay by comparing it to what she thought the market would bear. <blockquote class="tr_bq">'Any salary information will show you that my salary is always the lowest of any (hospital) CEO currently in the entire state, even the little-bitty hospitals,' Bayless said. 'On any measure, 375 (thousand dollars) is below market. So, do I feel undercompensated? I don’t know. But on any measure, it always comes in below market.'</blockquote> Members of the hospital system's board also justified the pay on the grounds that it was at the market rate: <blockquote class="tr_bq">[Board Members Mary] Harden and [Terence] McMahon said they voted for the pay raise because a national search firm hired to find Bayless’ replacement set $500,000 as a minimum competitive salary for qualified candidates.</blockquote> Another board member also noted how hard CEO Bayless works: <blockquote class="tr_bq">'The lady works 70-plus hours a week. She’s on call 24/7. So, I think the job warrants it. She works very, very hard,'  Dewane said.</blockquote>I am sure health care professionals who also work long hours, and are frequently on call, but unlike managers, have to make decisions with real life and death consequences would understand, or not. California In California a report focused in contrast on the bigger hospitals and hospital systems.  California Healthcare News <a href="http://www.payersandproviders.com/news-article.php?news_id=138&region=3">reported</a> on the best compensated hospital executives in the state.  In general, <blockquote class="tr_bq">More than one in five non-profit hospital chief executive officers in California received compensation totaling $1 million or more in 2010, according to a new pay survey by Payers & Providers. Altogether, 32 CEOs of the 154 surveyed received pay packages that ventured into the seven figures. That compares to 19 CEOs who received seven-figure pay packages in the only prior survey Payers & Providers conducted. That survey was published in June 2010, and relied primarily on data from 2007 and 2008.  </blockquote> Some specifics about the best paid executives: <blockquote class="tr_bq">Kaiser Permanente's George Halvorson is the most highly-compensated hospital system executive in California, receiving $7.74 million in 2010. That included more than $6 million in additional compensation. Halvorson is retiring as Kaiser's CEO in June. Thomas Priselac, the chief executive officer of Cedars-Sinai Medical Center in Los Angeles, was the highest-paid standalone hospital CEO, earning $2.77 million in 2010. That included additional compensation of $1.6 million.</blockquote> The article provided the justification for Priselac's seven-figure compensation: <blockquote class="tr_bq">According to an email response from Cedars-Sinai spokesperson Duke Helfand, Priselac's compensation 'reflects the top-tier clinical, research and educational performance the medical center consistently has delivered in his 19 years of leadership.'</blockquote> He did not offer how this performance was measured, how it compared to that of any other hospital, or whether anyone other than the CEO might have been responsible for that performance. The survey results included the best compensated CEO of a health-district <blockquote class="tr_bq">Michael Covert,  the CEO of the two hospital Palomar-Pomerado Health system in San Diego County, was the highest-paid district hospital CEO, earning $1.09 million in 2010. He was among two district hospital CEOs to earn seven-figure compensation. </blockquote> The survey results also included the best compensated CEO for academic medical centers run by the (state supported) University of California: <blockquote class="tr_bq">David T. Feinberg, M.D., is by far the highest-paid CEO among those who oversee the five research hospitals operated by the University of California. Feinberg, who runs Ronald Reagan UCLA Medical Center, earned $1.33 million in 2010 – the only seven-figure pay package among that cohort of CEOs, and nearly $450,000 more than the second-highest earner in that group, Mark Laret of UC San Francisco Medical Center.</blockquote>Connecticut Becker's Hospital Review <a href="http://www.beckershospitalreview.com/compensation-issues/9-connecticut-hospital-ceos-pay-tops-1m-in-fy-2011.html">provided information</a> on the highest paid Connecticut hospital CEOs: <blockquote class="tr_bq">Here are the nine CEOs who earned at least $1 million in 2011. •    Clarence Silvia, The Hospital of Central Connecticut: $2.76 million •    Marna Borgstrom, Yale-New Haven Hospital: $2.59 million •    Brian Grissler, Stamford Hospital: $2.24 million •    Elliot Joseph, Hartford Hospital: $1.74 million (*CEO is now Jeff Flaks) •    Frank Corvino, Greenwich Hospital: $1.71 million •    Susan Davis, RN, Saint Vincent's Medical Center: $1.48 million •    Chris Dadlez, Saint Francis Hospital and Medical Center: $1.42 million •    John Murphy, MD, Danbury Hospital: $1.08 million •    Christopher O'Connor, Hospital of Saint Raphael: $1.04 million</blockquote>  The report did not provide any justification for the pay levels, and I could find no further news coverage that was relevant. Massachusetts The Fitchburg (MA) Sentinel and Enterprise seemed to be the only media outlet which  <a href="http://www.sentinelandenterprise.com/local/ci_22266835/questions-raised-pay-mass-hospital-execs">noted</a> the compensation of hospital executives reported to the state attorney general.  It listed compensation of some regional hospital leaders, <blockquote class="tr_bq">Patrick Muldoon, president and CEO of HealthAlliance Hospital, a member of the UMass Memorial Health Care system, received a compensation package of $653,868 in 2010, the most recent year for which compensation data is publicly available. The HealthAlliance system includes a 135-bed community hospital with services on two campuses in Leominster and Fitchburg. Over that same period, Daniel P. Moen, former president and CEO of the 153-bed Heywood Hospital in Gardner, received a compensation package of $386,126. Christine Schuster, CEO of Emerson Hospital in Concord, earned a total compensation package of $669,844. Emerson has 179 beds. Lahey Clinic chief executive Howard Grant, who oversees a facility with 317 beds, was paid a total compensation package of $768,568 in 2010. </blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> The article did not note the justification for the pay of any of these CEOs.  I was unable to find any other recent reporting that took advantage of the data supplied to the state Attorney General.</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">New York</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">SUNY - Downstate Medical Center The New York Daily News <a href="http://www.nydailynews.com/new-york/brooklyn/suny-downstate-bigs-earn-200k-lich-closing-moves-article-1.1257273">reported</a> on compensation given to executives at one state supported university medical center:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">15 SUNY Downstate Medical Center bigs are raking in $200,000-plus salaries even as plans move forward to shut down its Long Island College Hospital campus. Downstate president Dr. John Williams who’s leading the drive to close the Cobble Hill hospital gets the fattest pay of all. He’s paid $650,000 a year salary and gets an annual housing allowance of up to $80,000 and the use of a car.</div></blockquote>It listed the following compensation information for other executives: <blockquote class="tr_bq">Other big hospital administrators’ salaries, 2011 * $552,556.33 — Debra Carey, vice president * $357,379.26 - Grace Wong, vice president * $334,072.19 — Ivan Lisnitzer, vice president * $312,182.24 — Paul Davis, assistant vice president * $286,954.51 Renee Poncet, vice president</blockquote> This should be viewed in the context of the medical center's current dire straits: <blockquote class="tr_bq">SUNY Downstate — which has a hospital and medical school in East Flatbush — is in such bad financial shape it could go broke by March, SUNY chairman Carl McCall has said.</blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Of course, despite these financial threats, a "spokesman" defended these payments again as market-based:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"><blockquote class="tr_bq">[Robert] Bellafioire defended the brigade of big salaries — though the controller’s audit suggested Downstate should consider cutting the number of high-paid administrators. </blockquote><blockquote class="tr_bq">'We have to offer competitive compensation, particularly when we’re up against any number of the country’s best hospitals and medical schools just across the bridge and in the metropolitan area,' Bellafiore said.</blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Rural Hospitals in Upstate New York On the other hand, the Plattsburgh (NY) Press-Republican <a href="http://pressrepublican.com/0100_news/x1303545809/Salaries-of-hospital-CEOs-detailed">reported</a> on the compensation given to hospital executives in rural northern New York state.  These included Alice Hyde Medical Center:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">John Johnson, president and chief executive officer, was paid $339,539 in 2010. He retired in the fall of 2012. He was replaced by Douglas DiVello, who is paid $246,682 in salary and benefits.</div></blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> Then there was CVPH Medical Center in Plattsburgh </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Hospital President Stephens Mundy has been at CVPH for 10 years and was paid $749,563 in salary, bonuses and other compensation in 2010. His base salary for 2013 is $478,421,...</div></blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">In addition, there was Elizabethtown Community:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Rodney Boula, president and chief executive officer at ECH, was paid $229,902 in 2010.</div></blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Note that later the article explained that this hospital has no more than 25 beds. However, the reporter was unable to find out the compensation of the CEO of the Adirondack Medical Center in Saranac Lake:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Chandler Ralph, president and chief executive officer for 16 years, is not employed by the hospital or its umbrella organization, Adirondack Health. She is paid through a contract with a management company, Health Tech Management Services, said Joe Riccio, AMC communications director. Her salary is a confidential employment contract, 'just like any other vendor that does business' with the hospital, he said. Because of that, her salary was not available through IRS records. The Press-Republican pressed Ralph to release her salary, noting that it was publishing the pay of all other area hospital CEOs, but she refused, citing confidentiality.</div></blockquote><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Parenthetically, this seems to be an unusual case of the actual outsourcing of top leadership. This compensation information again should be considered in the context.  These are all relatively small hospitals in a rural area with low costs of living.  In addition, these hospitals were facing substantial financial challenges:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><blockquote class="tr_bq"><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Numerous jobs were cut in 2012 at the area’s five hospitals, some the first substantial layoffs in decades. One hospital recorded an operating deficit, and at some, programs and services were reduced. Adirondack Health, parent company of Adirondack Medical Center in Saranac Lake, and CVPH Medical Center in Plattsburgh, each laid off 17 employees last fall and eliminated vacant positions. Alice Hyde Medical Center in Malone let 12 people go in September and had closed down more than a dozen vacancies.</div></blockquote> <div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Nonetheless, the justifications for these compensation levels included the usual suspects.In an introductory discussion not specific to any hospital, we find:</div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> <blockquote class="tr_bq">'The responsibilities of a CEO have exploded in the last four years,' said William Van Slyke of the Healthcare Association of New York State, an organization that represents hospitals and health-care systems across the state.</blockquote>Similarly, <blockquote class="tr_bq">'Being a hospital CEO, you are ‘all in,’ all the time, every hour. It’s a tremendous responsibility.'</blockquote>  This is the familiar argument about how hard seemingly all hospital CEOs work.  As noted above, it is particularly incongruous in a health care setting in which numerous health professionals are also "all in," and these professionals bear the responsibility of making decisions and taking actions that can directly affect patients' health, safety, and even survival.  Following this were the equally familiar arguments that the compensation of CEOs is determined by the market, and so to retain CEOs one must pay at this market rate: <blockquote class="tr_bq">'Being a hospital CEO, especially in the state of New York, is complex and demanding job. There is an extraordinarily limited pool of candidates, and that increases their value.' 'I can’t speak for the hospitals in your area,' he told the Press-Republican, 'but a qualified and successful CEO can go anywhere in the country and make equal or higher salaries.'</blockquote> The Press Republican also elicited very similar articles justifying pay for individual hospital CEOs, for example, regarding the CEO of the Alice Hyde Medical Center, here is the "compensation is determined by the market" argument from "Dean Johnston, president of the Board of Trustees, and member of the hospital's Compensation Committee" <blockquote class="tr_bq">'It’s important that the salary is competitive with other institutions because it’s difficult to attract professional leaders who will improve the quality of care.'</blockquote> And from the same person, here is the "CEOs work very hard" argument <blockquote class="tr_bq"> 'It’s difficult being CEO,' Johnston continued, 'because you’re the head of a complex and multi-faceted institution.'</blockquote> Very similar arguments were made to justify the compensation of the CEO of CVPH Medical Center.  The Usual Talking Points and Logical Fallacies So, to summarize, hospital executive compensation, at least such compensation that gets noted in the media, seemingly never has been better.  CEOs at even the smallest, most rural, non-profit community hospitals can make well into the six figures.  CEOs at public hospitals can make over half a million dollars.  CEOs at larger hospitals, even those that are state supported, can make even more, up to millions a year for CEOs of moderate to large non-profit hospital systems.  Even hospitals that are facing financial challenges, or that are laying off employees still pay substantial amounts. In previous posts, we noted that whenever anyone bothers to try to justify extravagant executive compensation at hospitals, and for that matter, other health care organizations throughout the US, they seem to repeat the same set of talking points.    We first listed the talking points <a href="http://hcrenewal.blogspot.com/2011/09/talking-points-sans-original-thought-to.html">here</a>, and then provided additional examples of their use <a href="http://hcrenewal.blogspot.com/2011/09/more-repeats-of-talking-points.html">here</a>, <a href="http://hcrenewal.blogspot.com/2012/03/example-of-how-complex-takes-control.html">here</a> and <a href="http://hcrenewal.blogspot.com/2012/12/health-care-hired-managers-not-playing.html">here</a>.   The talking points are: -  we pay what everyone else pays -  CEOs work hard and are brilliant, and so deserve high pay -  high pay is needed to attract and retain competent, if not brilliant people. None of the examples of these talking points we have seen so far explain why these apply to CEOs and other top hired managers, but not to other kinds of employees.  So it should be no surprise that the justifications for the largesse to hospital executives found in the cases above follow the talking points yet again. We Pay What Everyone Else Pays  Another way to put this is that some market determines CEO pay.  We saw versions of this to support the compensation of the CEOs of Maricopa Integrated Health System in Arizona, and SUNY - Downstate Medical Center and Alice Hyde Medical Center in New York. Note that almost never is this argument supported by data about whether comparisons were actually made to a representative peer group.  In any case, as we <a href="http://hcrenewal.blogspot.com/2012/12/health-care-hired-managers-not-playing.html">asserted before</a>, this justification may be a logical fallacy, an <a href="http://www.nizkor.org/features/fallacies/appeal-to-common-practice.html">appeal to common practice</a>. CEOs Work Hard and Are Brilliant  This is an especially frequently used talking point.  I have yet to see an instance in which any hospital official would omit a CEO was anything other than supremely diligent and totally brilliant.  We saw versions of this to support the compensation of the CEOs of Maricopa (AZ), Cedars-Sinai Medical Center in California, the Alice Hyde Medical Center and CVPH Medical Center in New York, and generically to support all New York State hospital CEOs. As we noted above, this justification is almost never accompanied by any evidence that CEOs work harder or are more brilliant than the numerous health care professionals who actually make it possible for the hospital to operate.  I would guess it would be very hard to show that CEOs work longer hours, are under more stress, make more consequential decisions, are smarter or better trained than typical doctors, nurses and other health care professionals.  This justification thus appears to be another kind of logical fallacy, an <a href="http://www.nizkor.org/features/fallacies/appeal-to-authority.html">appeal to authority</a>. High Pay is Needed for Retention  We saw versions of this to support the CEOs of Maricopa, SUNY - Downstate, Alice Hyde, CVPH, and generically again to support all NY hospital CEOs.  </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Note that this justification is also almost never supported by any evidence.  As we noted <a href="http://hcrenewal.blogspot.com/2012/10/more-reasons-to-doubt-how-ceos-are.html">here</a>, while this argument, probably like the others, comes from the generic business management literature, there is little data in the larger business world to show that CEOs are very mobile, or likely to succeed when transplanted to a new environment.  In fact, a recent report looking at the mobility of CEOs worldwide called this a "self-serving myth."  (See <a href="http://www.huffingtonpost.com/2013/02/11/ceo-pay_n_2661438.html">this summary</a> for a link to it.) </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;"> </div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">It is too bad that no one ever seems to get the opportunity to challenge these talking points when they are offered as justifications for outlandish executive compensation.  <div style="color: black; font: 10pt sans-serif; height: 1px; overflow: hidden; text-align: left; text-transform: none; width: 1px;"> Read more here: http://www.charlotteobserver.com/2013/02/06/3835851/charlotte-hospital-pay.html#storylink=cpy</div><div style="color: black; font: 10pt sans-serif; height: 1px; overflow: hidden; text-align: left; text-transform: none; width: 1px;"> Read more here: http://www.charlotteobserver.com/2013/02/06/3835851/charlotte-hospital-pay.html#storylink=cpy</div> </div></div><div style="background-color: white; border: medium none; color: black; overflow: hidden; text-align: left; text-decoration: none;">Summary</div> As we have <a href="http://hcrenewal.blogspot.com/search/label/executive%20compensation">shown again and again</a>, the pay of top health care leaders seems to endlessly increase, without clear justification, regardless of the vicissitudes affecting the organizations they lead, their employees, their patients and society.  This suggests that health care organizations, like many other organizations, seem to be run primarily for the benefit of their executives and their cronies, regardless of what happens to anyone else.   As we have frequently said, current policies about paying hired health care managers leave the managers unaccountable for the effects of their actions on patients' and the public's health, and worse, fail to deter and may even encourage ignorance of the health care mission, frankly mission-hostile behavior, self-interest, conflicts of interest, and outright corruption.  Meanwhile, paying nearly all top managers as if they were brilliant, while setting much harsher standards for the employees who actually take care of patients, including health professionals, demoralizes those on whom patients actually depend for care. As we have said endlessly,....   Health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research. On the other hand, those who authorize, direct and implement bad behavior ought to suffer negative consequences sufficient to deter future bad behavior. If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.

Non-Profit Hospital Executive Salaries Continue to Defy Gravity and Logic

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13 Feb 2013

The Parts of Professionalism We Are Not Supposed to Discuss

A recent article in a a relatively obscure medical ethics journal dared to approach some important aspects of medical ethics that medical ethicists fear to discuss, but did not address the reasons for this fear or what to do about it. (Glenn JE. The eroding principle of justice in teaching medical ethics.  HEC Forum 2012; 24: 293-305.  Link <a href="http://link.springer.com/article/10.1007%2Fs10730-012-9199-4">here</a>.) The Basic Ethics Case - A Prescription for the Patient's Spouse? Glenn began with a case typically discussed in medical school ethics courses: <blockquote class="tr_bq">a scenario where a standardized patient asks the student at the end of the examination if his prescription can be written in his spouse’s name as the spouse has health insurance which includes prescription drug coverage while the patient does not.</blockquote> This <blockquote class="tr_bq">poses the question as to whether it is ethical for physicians to deceive third party payers to secure coverage for their patients.</blockquote> The Politically Correct Way to Teach the Case Glenn stated that there is a politically correct way for faculty to teach this case: <blockquote class="tr_bq"> Though we are never expressly instructed to tow [sic] a party line, there is a 'correct' answer to this ethical quandary as far as the institution we work for is concerned. Students who express a willingness to practice deception of third party payers for the good of their patients are to be commended for having their heart in the right place. However, we discuss many reasons why this action would not be a good solution to the problem. One of the issues is that to do so would be committing fraud.</blockquote> Now, of course, writing a prescription for a patient who does not actually need the drug in question, understanding that the patient will give the drug to someone else who does not have insurance coverage to pay for it, is dishonest.  However, the larger point that Glenn made is that it is not politically correct to allow discussion about why the patient made such a request in the first place, and that this ought to be troubling. Note that Glenn did not explain how he inferred what the "correct" answer was, nor its actual source within the institution. <blockquote class="tr_bq">Over the first few years of having this conversation with young medical students, I have always come away feeling empty and flat. Framed as a session on the ethics of 'truth telling,' the conversation and the readings we provide to prepare for it works to obfuscate the much larger ethical issue impossible to tackle in an hour’s time. In essence, 'truth telling' is only a secondary ethical issue at play. The more important ethical issue is a question of social justice: what commitment do doctors have to poor patients and making sure that they get the health care services that they need?</blockquote> Social Justice as Part of Professionalism, and its Avoidance The article by Glenn then emphasized that some of the original conceptions of physicians' professionalism included social justice.  A definition promulgated by Herbert Swick in 2000 expressly included these relevant competencies.  Physicians ought to: -  subordinate their own interests to the interests of others -  respond to social needs and work toward the benefit of the communities in which they live and serve -  adhere to the core humanistic values of honesty and integrity, compassion, altruism, empathy, respect for others, and trustworthiness. Glenn noted that these three competencies, however, have been turned into a more narrow imperative, that <blockquote class="tr_bq">doctors should treat patients with an equally high quality irrespective of their race, ethnicity, gender, religion or cultural background according to what is best for them. In most codes of professionalism, however, class is not expressly implicated.</blockquote> Note that Glenn did not question why the issues of race, ethnicity, gender, religion, or cultural background became important in this context.  He did further question why the issue of class did not.  While <blockquote class="tr_bq"> The professionalism code adopted by the American Board of Internal Medicine in 1999 was bolder and specifically states that doctors are to advocate for 'the best possible care [for their patients] regardless of the ability to pay'</blockquote> Glenn asked <blockquote class="tr_bq"> But where in the medical school curriculum do we teach medical students to be strong patient advocates and take on third party payers and hospital administrators? We now discuss the importance of prescribing generic drugs and we warn against the influence of big pharma, but when do we teach students to rebel against the high cost of medical education that drives students toward boutique medicine and fields of specialty care that offer the most money and most comfortable lifestyles?</blockquote> Furthermore, he noted, <blockquote class="tr_bq"> When it comes to justice in medical ethics instruction, the parameters of the discussion are usually constricted to focus on the conservation of health care resources and rationing care rather than providing more care to more patients.</blockquote> So, now seemingly getting to the key question, <blockquote class="tr_bq">We have created an entire system where all the middlemen that stand between a patient and her health care are expecting to get rich. No oath or professionalism curriculum is structured to teach medical students how to ethically and morally navigate through that. How did the terms of the debate get so co-opted by the health care economists?</blockquote> The Key Question also Avoided However, after this build up, Glenn then had trouble grappling with that question.  He noted that the prices of various parts of US health care are rarely questioned, and wrote about some of the particular issues in pricing new technologies, including the costs of development of new drugs, the tax treatment of drug development, and whether the licenses drug companies obtain from universities to develop drugs are fairly priced.  He also touched on the rising cost of medical school tuition and students' consequent assumption of large levels of debt.  This was interesting, and provided some useful references, but never really directly addressed the key questions above: why was the discussion framed in terms only of current health economics, and more importantly,  why did he and other ethicists feel they could not openly discuss any larger issues? Only at the very end of the article did this appear <blockquote class="tr_bq">the structure of our current medical system has created a network of health care providers, researchers, purveyors and administrators who have strong financial incentives to work against the best interests of patients. This situation makes it difficult to talk with students about the ethical principle of justice in any meaningful way that is not hypocritical, leaving it seldom emphasized relative to the other three core principles of medical ethics.</blockquote> Glenn did not further explain these "financial incentives," detail further who had them, explain how they "work against the best interests of patients," and most importantly, explain how these incentives make "it difficult to talk with students about the ethical principal of justice in any meaningful way that is not hypocritical."  He concluded only <blockquote class="tr_bq"> How can we cultivate within our students an understanding of the threats to medical professionalism posed by the conflicts of interest inherent in the various financial and organizational arrangements in the practice of medicine?  We start by not shying away from the conversation.</blockquote> Summary So Professor Glenn argued that social justice has been considered part of health care ethics, and that ethicists should teach about it by questioning the current economic arrangements within the health care system.  He then suggested that ethicists have been somehow pressured not do raise such questions, and that this pressure has something to do with <a href="http://hcrenewal.blogspot.com/search/label/perverse%20incentives">perverse incentives</a> and <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">conflicts of interest</a> prevalent within health care.  However, he never actually addressed who pressured the ethicists, how the pressure was applied, and how that pressure was related to conflicts of interest. Thus, it seems that authors in scholarly health care journals may now hint that there are certain things one must not discuss, that are taboo to discuss in health care, but cannot actually say what exactly is taboo, and why it became that way.  Thus, the article by Glenn seems related to what we sometimes coyly call the "<a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a>,"  that the issues we discuss on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal</a> often do not seem to be considered topics of polite conversation.  But in a strange recursive way, the article never could quite manage to discuss what it is it said others cannot discuss, which in a way just further validates the importance of the anechoic effect. The Glenn article is reminiscent of another article we <a href="http://hcrenewal.blogspot.com/2012/01/elephants-we-can-notice-but-cannot-name.html">posted</a> about.  That article, by Souba and colleagues,  found that there are many "elephants," that is,  unmentionable subjects, in academic medicine,  However, that article also never clearly defined what these unmentionable subjects actually are, other than subjects that displease those in power.  Thus this too reinforced just how taboo these topics are.  Even those willing to admit that taboo topics exist are still unable to name them. At least the Glenn article did suggest, however vaguely, a relationship between conflicts of interest and the anechoic effect.  We have documented that <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">individual </a>and<a href="http://hcrenewal.blogspot.com/search/label/institutional%20conflicts%20of%20interest"> institutional</a> conflicts of interest are rampant in health care, including, and probably particularly academic medicine.  For example, pharmaceutical companies (and also all sorts of other health care corporations) may pay medical school faculty members and administrators (as consultants, <a href="http://hcrenewal.blogspot.com/search/label/key%20opinion%20leaders">"key opinion leaders,"</a> speakers, advisers, even board members).  The leaders of academic medicine seem particularly prone to such conflicts. For example, a majority of US medical school department chairs have significant financial relationships with health care corporations (see post <a href="http://hcrenewal.blogspot.com/2007/10/medical-school-leaders-conflicts-of.html">here</a>).  We have shown how top medical school leaders may simultaneously serve on the boards of directors of health care corporations (see post <a href="http://hcrenewal.blogspot.com/2006/03/new-species-of-conflict-of-interest-in.html">here</a>). Such health care corporations may now also support various aspects of medical academia (through research grants, "unrestricted" and other educational grants, other gifts to hospitals and universities, etc).  Financial conflicts of interest may help to directly enrich many faculty and academic leaders, and indirectly enrich them by enriching their organizations. People who are personally profiting from relationships with health care corporations are unlikely to question such relationships.  The leaders of organizations which depend on funding from such corporations are unlikely to question whether conflicts of interest might lead to corruption.  People whose colleagues, friends, family members, or supervisors are personally benefiting from conflicts of interest may hesitate to challenge such relationships.   Since these relationships permeate the economics of health care, is it any wonder that the entire topic has become taboo?   So the first step in challenging this taboo is to acknowledge it exists, and to not "shy away" from discussing it, as Glenn suggested.  People are beginning to acknowledge there is an elephant in the room.  Now we have to describe the elephant, discuss the elephant, and eventually figure out how to get the elephant out of the room.      Hat tip - to the <a href="http://blog.abimfoundation.org/recommended-reading-november-3-9/">Medical Professionalism Blog</a>.

The Parts of Professionalism We Are Not Supposed to Discuss

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06 Dec 2012

Health Care Academics' Unrest and Bad Health Care Leadership?

Last month we <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">discussed</a> a recent, large scale study of physician burnout, and wondered whether it would finally inspire some discourse about why physicians are really so upset.  In particular, we hypothesized,  based on some real, if limited data, that physician angst, dissatisfaction, burnout, etc may mainly be a response to the problems with leadership and governance of health care organization we post about on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal.</a> After that post, one of our scouts found a very interesting and relevant article from earlier this year which got little attention at the time, but deserves more.  [Pololi LH, Krupat E, Civian JT, Ash AS, Brennan RT. Why are a quarter of faculty considering leaving academic medicine? A study of their perceptions of institutional culture and intentions to leave at 26 representative U.S. medical schools. Acad Med. 2012; 87: 859-69. Link <a href="http://www.ncbi.nlm.nih.gov/pubmed/22622213">here</a>.] Study Design This was a cross-sectional survey of faculty at 26 medical schools in the US, selected to be similar to the general population of medical schools in the country.  At each school, 150 faculty were randomly chosen stratified by sex and age, and then the sample was enriched to include additional minority faculty and women surgeons, for a total of 4578. The faculty were sent a multi item survey to assess their perception of the organizational culture of their institutions, and asked about their intentions to continue in or leave their current positions and academic medicine.  Responses to each survey item were allowed to be from 1 = strongly disagree, to 5 = strongly agree.  The items on the survey were combined into various scales.  A number of items on the survey seemed to be related to issues we frequently discuss on Health Care Renewal.  These items ended up in three different scales, entitled Relatedness/Inclusion, Values Alignment, and Ethical/Moral Distress.  The survey items are listed below, grouped by issue, with the scales into which they were combined noted. Issue: <a href="http://hcrenewal.blogspot.com/search/label/mission-hostile%20management">Mission-Hostile Leadership</a> Administration only interested in me for revenue   (Reverse coded) (Values Alignment) Institution committed to serving the public (VA) Institution's actions well-aligned with stated values and mission (VA) Institution puts own needs ahead of educational/clinical missions (RC) (VA) My values well-aligned with school's (VA) Institution awards excellence in clinical care (VA) Institution does not value teaching (RC) (VA) Have to compromise values to work here (Ethical/Moral Distress) Issue: <a href="http://hcrenewal.blogspot.com/search/label/deception">Deceptive</a>, Unethical Leadership Felt pressure to behave unethically (Ethical/Moral Distress) Need to be deceitful in order to succeed (EMD) Others have taken credit for my work (EMD) Issue: Generation of the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">Anechoic Effect</a> by  Suppression of <a href="http://hcrenewal.blogspot.com/search/label/free%20speech">Free Speech</a>, <a href="http://hcrenewal.blogspot.com/search/label/academic%20freedom">Academic Freedom</a>, Dissent, <a href="http://hcrenewal.blogspot.com/search/label/whistle-blowers">Whistle-Blowing,</a> Feel ignored/ invisible (RC) (Relatedness/Inclusion) Hide what I think and feel (RC) (R/I) Reluctant to express opinion/ fear negative consequences (RC) (R/I) So in summary, the survey contained quite a few questions about mission-hostile management, comprising nearly all of the Values Alignment scale, some questions about deceptive or unethical leadership, all in the Ethical/Moral Distress scale, and some about generation of the anechoic effect by suppression of free speech, academic freedom, dissent, and whistle-blowing, all in the Relatedness/Inclusion scale. Results The response rate was 52% (N=2381.) Unfortunately, the article did not include the distributions of the responses to individual survey items, and only included the mean and standard error of the scale scores.  The values for the scales of most interest were: Relatedness/Inclusion  3.56 SE= 0.022 Values Alignment  3.25 SE=0.028 Ethical/Moral Distress 2.36 SE=0.022 Note that the article did not address the degree individual items, especially those listed above, contributed to variation in the scale scores. A small majority of faculty indicated their intentions to stay at their institutions (57%).  Of the remainder, 14% were considering leaving their school due to dissatisfaction, and another 21% were considering leaving academic medicine due to dissatisfaction.  The remainder were considering leaving due to personal/ family reasons or to retire. The authors did complex multinomial logit modeling to assess the relationships among the various scales, demographic factors, and intention to leave.  Most relevant to us, Relatedness/Inclusion was significantly related to intention to leave the institution due to dissatisfaction (Coefficient -0.69, p lt 0.001, OR =0.50), as was Values Alignment (-0.39, p=0.04, OR=0.68), but not Ethical/ Moral Distress.  Furthermore, Relatedness/Inclusion was related to intention to leave academic medicine due to dissatisfaction (-0.48, p lt 0.001, 0.62), as was Ethical/Moral Distress (0.60, p lt 0.001, OR =1.82). The article did not address whether individual survey items, including those of most interest listed above, were related to intention to leave.  The article also did not address whether responses to the survey or intention to leave varied across faculty characteristics, medical school characteristics, or individual medical schools.  Summary and Comments This very large survey of faculty from multiple US medical schools showed that more than one-third were considering leaving their institutions or academic medicine due to dissatisfaction, indicating a striking prevalence of faculty distress.  Their responses to questions about perceived organizational cultural and leadership problems, including those possibly related to leadership's perceived hostility to the mission, leadership's perceived dishonesty or unethical behavior, and leadership's suppression of dissent, free speech, academic freedom, and whistle-blowing were related to their intentions to leave due to dissatisfaction. These results suggest the hypothesis that much of faculty angst may be due to the sorts of problems with leadership and hence organizational culture that we discuss on Health Care Renewal.  Since this was a cross-sectional survey, it certainly does not offer scientific proof of this hypothesis.  Note that there is other evidence from numerous cases discussed in Health Care Renewal, qualitative studies and our much smaller study published only in abstract form that also supports this hypothesis (look <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">here</a>).  One part of the author's discussion of their findings was particularly relevant: <blockquote class="tr_bq">Our findings are congruent with metaanalyses of 25 years of organizational justice research outside medicine. These studies suggest that employee perceptions of organizational justice and an ethical climate are related to increased job satisfaction, trust in leadership, enhanced performance, commitment to one’s employer, and reduced turnover.  The scale of ethical/moral distress (see Table 1) reflects reactions to the prevailing norms and possible erosion of professionalism and increased organizational self-interest. There is a growing belief that organizations influence and are responsible for the ethical or unethical behaviors of their employees.To our knowledge, faculty perceptions of 'moral atmosphere' and 'just community' embedded in our survey have not been previously investigated in academic medicine, even though the ethical concepts of professionalism and justice can be used to guide the pursuit of excellence in the missions of medical schools. Several scholars have called for academic medicine to attend to its social justice and moral mission. Faculty perceptions of organizational justice are pivotal to the critical issue of professionalism in medicine. The ethical/moral distress scale in the survey reported here included items such as 'the culture of my institution discourages altruism' and 'I find working here to be dehumanizing.' (See Table 1 for other items in this scale.) In that ethical/moral distress was more strongly related to intent to leave academic medicine entirely than intent to leave one’s own institution, these negative feelings among faculty must be particularly disheartening to them and may color major career decisions.</blockquote>I believe that the study by Pololi et al adds to the evidence that physician distress is a symptom of a dysfunctional system in which major health care organizations have been taken over by leaders more devoted to self-interest and short-term revenue than the values prized by health care professionals and academics.  This applies obviously to academic medical institutions, but also to other organizations that might have been expected to defend such professional and academic values, such as professional associations, accrediting organizations, and health care foundations.  As we <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">said before</a>, if physicians really want to address what is making them burned out and dissatisfied, they will have to regain control of their own societies, organizations, and academic institutions, and ensure that these organizations put core values, not revenue generation and providing  cushy compensation to their executives, first.

Health Care Academics' Unrest and Bad Health Care Leadership?

Last month we discussed a recent, large scale study of physician burnout, and wondered whether it would finally inspire some discourse about why physicians are really so upset. In particular, we hypo…

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03 Oct 2012

The Case of the Vanishing Graduate Medical Education Funds

While primary care falters in the US, those who teach it seem to feel increasingly poverty stricken.  Now it appears that one reason for this is an amazing example of multiple failures of transparency and accountability.  Let me work through it, begging your pardon for a little bit of "inside baseball," medical education style.  The results suggest how we desperately need some medical disciples of Sherlock Holmes. Background My personal experience and increasing data suggests that most medical school faculty believe that their teaching is not valued by their institutions because teaching brings in no external funds.  In 2004, Dr Catherine DeAngelis, then the editor of JAMA, wrote "few medical schools provide adequate, if any, reimbursement for teaching time."(1)  (See<a href="http://hcrenewal.blogspot.com/2005/01/medical-schools-charge-more-for.html"> this 2005 post</a>.)   This seems absurd on its face, since what are medical schools for if it is not to provide teaching.  However, there is evidence of this mission-hostile behavior.  In 2007, we <a href="http://hcrenewal.blogspot.com/2007/04/medical-schools-to-faculty-show-me.html">quoted </a>from a revealing interview with Dr Lee Goldman, Executive Vice President for Health and Biomedical Sciences at Columbia University,(2) who stated that "taxpayers," faculty who "generate more [money] than they cost," are valued most, and implied that faculty who focus on teaching are regarded as "welfare recipients," who bring in less external funding, and are valued least.  In 2010, we <a href="http://hcrenewal.blogspot.com/2010/12/american-medical-schools-are-only-in-it.html">noted</a> the results of a large-scale survey presented by Dr Linda Pololi in which 51% of faculty felt that the administration only valued them for the money that they brought in, and half felt that their institutions did not value teaching.(3) Yet while faculty seem to believe that educational institutions receive little if any money to pay for teaching, it is not clear why the believe something so counter intuitive, and it is less clear what money actually goes to pay for medical education. US Government Funding for Graduate Medical Education However, several recent publications affirm that actually a lot of money goes towards one important form of medical education, yet the specifics of the money flows are shrouded in secrecy.  In the May, 2012, SGIM Forum, Dr Mark Liebow and colleagues summarized some of what is known about federal support of graduate medical education, that is, education of interns, residents, and other house officers.(4)  There are two streams of money that flow from Medicare to US hospitals: <blockquote>Direct GME (DGME) payments help hospitals pay the salaries of residents, teaching faculty, and support staff. DGME is the product of three numbers: a per resident amount that varies by hospital, adjusted annually for inflation; the number of residents in the hospital (capped for each hospital at 1997 levels); and the fraction of discharges from the hospital that are Medicare beneficiaries. The Indirect Medical Education (IME) payment is a percentage amount added on to each DRG payment. The percentage is calculated via a complex formula (the only US statute containing an exponent!), where the key factor is the ratio of interns/residents to beds (IRB ratio).</blockquote> These two streams are of considerable size: <blockquote>Of the $9.2 billion Medicare paid for GME in 2010, $3 billion was for DGME and $6.2 billion for IME. The money is paid to hospitals sponsoring training programs rather than to the training programs or other hospitals where training occurs. While about 1,100 hospitals receive GME payments, 66% goes to the 200 hospitals that have the largest numbers of residents.</blockquote> So, the 200 largest hospitals get about $2 billion in direct GME money (and presumably about another $4 billion in indirect money). This averages then to about $10 million DGME and $20 million indirect GME per hospital. Thus, teaching, at least the teaching of interns, residents, and other house-staff does pay, and much more than trivial amounts. (Note that these amounts are not for teaching of medical students, which ought to be supported by other funding streams.) Why then do faculty think that teaching does not bring in any money? The GME Money Vanishes An article by Dr Saima I Chaudhry and colleagues in the American Journal of Medicine begins to explain, although the explanations are found between the lines.(5) First of all, while the graduate medical education money is paid by the government to the hospitals, the government does not publish what it pays to individual hospitals: <blockquote>It has been previously reported that the amount of GME funding individual hospitals receive is not publicly reported by the Centers for Medicare and Medicaid Services,.... </blockquote> The government also does not hold the hospitals accountable for how they spend this money, nor for the quantity or quality of education they supply in exchange for it. Remarkably, Chaudhry et al imply that that the people who run graduate medical education teaching programs also may not know how much money their hospitals receive from the government to fund their programs. The introduction to their article noted: <blockquote>It is unclear how much program directors know about the amount and flow of DME funds to their programs. Program directors' beliefs about the transparency of funding to their programs, or their desire to influence how funds are distributed to them, also are unknown.</blockquote> The article reported on a survey of internal medicine residency program directors which asked about "their knowledge of D[G]ME funding for their programs, the transparency with which funds are distributed to them, and their desire to influence this disbursement." The researchers sent surveys to 372 member programs, representing 97.1% of all US internal medicine residencies. They got 268 responses, a 72.0% response rate. The main results were that only 159/268 (59.3%) of program directors had tried to find out how much DGME money their programs received, and of those, only 84 (52.8% of those enquiring, but only 31.3% of all respondents) actually knew how much money their programs got. Of the 92 program directors who did not even try to discover how much money their programs received, approximately 21% said that "no one would tell me," 21% said that the "information would be inaccurate," 14% said they "don't know who to ask," and 2% were "afraid to ask." Summary US medical school faculty, especially those in primary care, increasingly feel pressured to perform activities that they perceive brings in money from external sources. They tend to believe that their own teaching somehow does not bring in any money, and that their careers will fail if they do not put more emphasis on other activities that the institution views as more profitable. However, literally billions of US government dollars go to support the education of house staff, including the salaries of faculty who teach interns and residents, who probably are the majority of physician faculty. Faculty probably do not know this, because the government does not publish the amounts given to individual hospitals, nor demand of the hospitals any accountability for how they spend the money they receive. Presumably, the top executives of each hospital know how much money the government gives them. Nonetheless, the majority of physician leaders of residency programs are never told these amounts, apparently because their hospital executives kept the amounts secret. Many of those educators who have tried to find out the figures were unsuccessful. Some did not even try to find out based on beliefs that their attempts would be unsuccessful, any amounts they discovered would be inaccurate, the people who knew the amounts were hidden, or that it would be dangerous to their careers to even try. Thus billions of dollars of money flowing from the government to fund graduate medical education seems to have vanished in an amazing example of widespread deficiencies in accountability and transparency. There are many people who blame government for many social ills. In this case, one can blame the US Congress for not writing a law that makes the money flows transparent and hospitals accountable for providing good educational value for the money provided. One can also blame the executive branch, particularly the Center for Medicare and Medicaid Services (CMS) of the US Department of Health and Human Services (DHHS) for not making the money flows and the values received for them transparent. There are a few people, including this author, who also blame the leadership of health care organizations for many of the problems besetting health care. In this case, one can blame top leadership, presumably CEOs and chief financial officers (CFOs) of hospitals for hiding the amounts of money they receive from Medicare to finance graduate medical education. One can also blame the physician leaders of residency programs for not insisting that they know the true sources of financial support for their programs, obtain budgets that reflect this support, and recognition that their faculty really do bring in external funds for their teaching of house staff (and are thus valuable "taxpayers" in Dr Goldman's parlance.) It is amazing that such amounts of money have been flowing for years mostly in secret. The secrecy has fueled incorrect, and in retrospect, bizarre ideas about the funding of medical education, and the value of medical educators to their institutions. This secrecy, in turn, has helped suppress the morale of medical educators, support the control of managers of health care professionals, and distort the flow of money within academic institutions and to compensation for certain favored individuals. Would our dysfunctional health care system not be better off if we demanded transparency and accountability from its leaders?  In particular, the US government should make payments to hospitals for graduate medical education completely transparent, and develop a system to hold these hospitals accountable for how they spend the money.  Meanwhile, top leaders of hospitals receiving this money should make the amounts transparent, first to the people who are supposed to be doing the education that the money pays for, and to the public at large.  This would allow those running the relevant educational programs to develop reasonable and realistic budgets, to treat their faculty with respect, and to demonstrate what value they provide for the money received.  The ongoing anechoic effect, and related deception and secrecy fostered by leaders in health care are major reasons our health care system is so dysfunctional, that costs are so high, and access and quality so poor.  True health care reform would ensure health care leaders put the mission before their personal enrichment, and act ethically with accountability, transparency, and honesty.  References 1.   DeAngelis CD. Professors not professing. JAMA 2004; 292: 1060-1.  Link <a href="http://jama.ama-assn.org/cgi/content/extract/292/9/1060">here</a>. 2.  Goldman L, Halm EA.  A view from the top: general internal medicine from the perspective of a chair and dean.  SGIM Forum, April, 2007.  Link <a href="http://www.sgim.org/userfiles/file/Forum/2007/Forum200704.pdf">here</a>. 3.  Pololi L, Ash A, Krupat E.  Faculty Values in the Culture of Academic Medicine: Findings of a National Faculty Survey. Link <a href="https://www.aamc.org/download/154216/data/your_career_is_more_than_your_specialty_-_246.pdf">here</a>. 4.  Liebow M, Jaeger J, Schwartz MD. How does Medicare pay for graduate medical education? SGIM Forum, May, 2012.  Link <a href="http://www.sgim.org/userfiles/file/May%202012%20Forum/May2012-09.pdf">here</a>. 5. Chaudhry SI, Khanijo S, Halvorsen AJ, McDonald FS,Patel K. Accountability and transparency in graduate medical education expenditures. Am J Med 2012; 125: 517-522. Link <a href="http://www.amjmed.com/article/S0002-9343%2812%2900071-X/fulltext">here</a>.

The Case of the Vanishing Graduate Medical Education Funds

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21 May 2012

Another Cautionary Tale about Conflicts of Interest: the CEO's Stretch Limousine, Golden Parachute, and Slush Fund

It remains fashionable in academic medicine to tolerate, if not celebrate conflicts of interest as necessary to support the "collaboration" needed for "innovation," while minimizing their risks (e.g., look <a href="http://hcrenewal.blogspot.com/2012/03/logical-fallacies-in-defense-of.html">here</a>).  Recently, another cautionary tale about how conflicts of interest signal the risk of all sorts of unpleasantness has appeared in the media. A Sentinel Event: the First Conflicts Uncovered In 2009, we <a href="http://hcrenewal.blogspot.com/2009/03/some-conflicts-grow-in-brooklyn.html">wrote</a> about some conflicts of interest at Wyckoff Heights Medical Center in my hometown of Brooklyn, NY.  The New York Daily News had reported that Dr. Addagada Rao, the hospital's chief of surgery was simultaneously the president and part-owner of a Caribbean medical school that funneled medical students to clerkships at Wyckoff.  The hospital's CEO, Rajiv Garg, was an investor in the same school.  At the time, I wrote, <blockquote>This story illustrates another twist on conflicts of interest affecting the leaders of not-for-profit health care organizations. Many of the smaller not-for-profit hospitals, of which there are thousands in the US, may have minimal conflict of interest policies, which may be minimally enforced, without much transparency or accountability. The coziness of the leadership culture of such smaller institutions may preclude anyone within the culture from asking tough questions. The results may be total confusion as to whose interests particular leaders are serving. In particular, the interests of each hospital's patients may get lost in the shuffle. In this case, the interests of medical students may also get lost in the shuffle. Although the institutions involved may be small, and hence the conflicts may seem small in terms of their monetary value, they aggregate to contribute to the moral miasma that now is the atmosphere of health care. </blockquote>You heard it here first. The CEO's Golden Parachute Fast forward to 2012. In January, the Daily News again <a href="http://articles.nydailynews.com/2012-01-31/news/31007403_1_brooklyn-hospital-center-state-advisory-panel-severance-payout">reported</a> that CEO Garg had been ousted, but that <blockquote>Trustees at Wyckoff Heights Medical Center asked to consider a whopping $875,000 severance payout for its former CEO are balking at the package....</blockquote> It seems that Garg's attorney claimed <blockquote>They were on the verge of bankruptcy when he arrived. He reduced the debt by tens of millions of dollars.</blockquote>However, <blockquote>the hospital’s financial situation remains grim. According to the work group’s final report, Wyckoff’s liabilities are $91 million greater than its assets and it is saddled with $114 million in long-term debt.</blockquote>So here is yet another example of a CEO personally profiting while his or her organization's finances fester. The Chauffeured Cars, the Stretch Limousine The the Daily News began <a href="http://articles.nydailynews.com/2012-02-10/news/31048142_1_security-guards-limo-beleaguered-hospital">chipping away </a>at the other ways CEO Garg benefited from his leadership of the fiscally troubled hospital. A notable symbol of these benefits was a stretch limousine: <blockquote>The ousted CEO of a debt-riddled Brooklyn hospital had his security guards ferry friends to the U.S. Open and his wife around town in a stretch limo, the Daily News has learned. Rajiv Garg, the disgraced honcho of Wyckoff Heights Medical Center, also enjoyed his own commutes in the hospital-issued ride — a sleek, black $33,000 Lincoln Royale.</blockquote>Garg rolled in style, <blockquote>The beleaguered hospital bought the fancy car — equipped with a mini-bar, four champagne flutes and a fridge for chilling Dom Pérignon — last summer for Garg It also owned two other cars for his use, sources said. Several times a week, the limo was dispatched to take Garg’s wife from her job near the hospital to the couple’s midtown apartment, said an employee. Sometimes, it picked her up and then swung by the hospital to get Garg and whisk them to dinner before dropping them home, sources said. Two or three times a month, the limo picked her up at home and took her shopping. 'I haven’t had a raise in seven years,' said the employee. 'They always tell us they don’t have any money. They spent it on cars.' The limo has comfy leather seats with room to spare for six passengers and a stereo system capable of drowning out highway noise when Garg and his wife were driven in it to Washington.</blockquote>More Conflicts of Interest Discovered Then the Daily News <a href="http://articles.nydailynews.com/2012-02-08/news/31039487_1_trustees-garg-hospital">started to reveal </a>conflicts of interest beyond the ones we discussed in 2009: <blockquote>Then-trustee Frank Chiarello was in a partnership that loaned money to hospital entities, according to a list of board members’ conflicts the Daily News eyeballed. The $2.5 million loan had an 18% interest rate, sources said, costing the hospital hundreds of thousands of dollars. Chiarello, a real estate exec, resigned from the board last week. Another trustee who quit the board last week, attorney John Rucigay, serves as a lawyer for other trustees, owns real estate with other trustees, and rents space to the Polish and Slavic Federal Credit Union — whose head of operations is yet another Wyckoff trustee, Agnieszka Poslednik. Additional trustees on the conflicts list first reported by Crain’s New York Business, include Andrew Boiselle, whose Cebco Check Cashing Corp. does check-cashing business with hospital employees, and attorney Fred Haller, who provides legal services to Wyckoff employees about issues not related to the hospital.</blockquote>Slush Funds and Bribes Last week, the Daily News <a href="http://articles.nydailynews.com/2012-03-19/news/31212038_1_bank-account-upstate-judge-bribes">reported </a>about findings by a judge that the CEO kept slush funds used to pay bribes: <blockquote>Wyckoff Heights Medical Center kept a secret bank account that a former CEO used to bribe a disgraced state assemblyman, an upstate judge said in a court decision. Orange County Supreme Court Judge Elaine Slobod’s decisionk brought to light new details about the Bushwick hospital’s alleged dealings with Tony Seminerio (D-Far Rockaway), who died in a North Carolina prison last year. The bank account used for the Stockholm St. hospital’s payoffs to the corrupt pol belonged to 397 Himrod Corporation. Former Wyckoff board chairman Emil Rucigay originally set up the company to buy real estate for the hospital to turn into a parking lot, the judge’s order said. The bank account was kept active — though the corporation was dissolved in 2001. The bank account still had approximately $130,000 in it in 2008. “[Wyckoff’s] CEO was using monies in the Himrod account to bribe Seminerio,” Slobad wrote in her decision last week, referring to Dominick Gio, who was the hospital’s head honcho at the time. Gio refused to talk a reporter last week. Wcykoff’s interim CEO Ramon Rodriguez also declined to comment. Money from the Himrod account was used to make payments totaling $15,000 to Seminerio, other court filings charge.</blockquote>A Lexus, a Bentley, Oh My Then the story really hit the big time when the New York Times <a href="http://www.nytimes.com/2012/03/26/nyregion/at-ailing-brooklyn-hospital-insider-deals-and-lavish-perks.html">picked it up yesterday</a>. That report added some colorful details about how magnificently the CEO traveled: <blockquote>In August 2009, Mr. Garg said, he fell asleep at the wheel and crashed his Lexus into a truck. He then lost his license. Asked why in the interview, he said he was not certain, though he offered several explanations, including unpaid tickets and previous accidents. He then used the hospital’s cars — a Lincoln Town Car and a Cadillac Escalade — for himself and his family around the clock. They were driven by two security guards on overtime, a hospital official said. He parked his other car, the $160,000 Bentley, at Wyckoff and had the hospital put the vehicle on its own insurance policy. </blockquote> The limo only came later, <blockquote>Mr. Garg said in the interview that he suspected that the drivers of the Town Car and the Escalade were eavesdropping on his conversations. So he had the hospital purchase a used stretch limousine for about $33,000. </blockquote>Yet More Conflicts of Interest Discovered The Times story also found more conflicts of interest. Some involved CEO Garg: <blockquote>Mr. Garg introduced hospital officials to Skyscape, a provider of mobile medical references, in which he had a financial interest. Wyckoff signed a contract with the company worth at least $38,700, hospital records show, though the deal eventually fell through.</blockquote> Others involved hospital trustees. This example might have affected patient care at the hospital: <blockquote>Dr. Theophine Abakporo arrived at Wyckoff in 1996 from Harlem Hospital to work in emergency medicine. Originally from Nigeria, he said he found his way to the top blocked by what he believed was a clique of doctors at Wyckoff. In 2009, according to data provided by MapLight.org, Dr. Abakporo, an American citizen, began donating money to the campaign of Representative Edolphus Towns, the Democrat who represents a nearby area. Mr. Towns, a longtime board member of Wyckoff, had by then been replaced by his chief of staff, Albert Wiltshire, on the board. Dr. Abakporo gave $1,000 to the Towns campaign, then $750, according to election records. With Mr. Wiltshire’s support, Dr. Abakporo became chairman of emergency medical services. </blockquote> This example might also have affected patient care: <blockquote>With his solicitous manner and tailored sport jackets, Gary Goffner, a pharmacist who serves on Wyckoff’s board, has long endeared himself to customers and doctors alike. He inherited his pharmacy, Kraupner, from his father, a prominent Bushwick landlord as well as a pharmacist, who died recently. It is an old-fashioned store, crammed with supplies, the opposite of an orderly Rite Aid. It is also a half-mile walk from Wyckoff, a disadvantage Mr. Goffner overcame through a contract that gave him exclusive access to Wyckoff patients as they were being discharged, and allowed him to keep an employee at the hospital to promote his business. </blockquote> In summary, the Times found, <blockquote>According to internal hospital documents, 13 of the hospital’s 22 board members declared at least one conflict of interest. </blockquote>Summary So, from a single story about conflicts of interest affecting the CEO and a medical leader at the hospital, we have gone to stories about widespread conflicts of interest affecting the hospital's board and leadership, about lavish payments and benefits to the CEO while the hospital's finances suffered, and allegations (by a judge) of bribes and slush funds.  Recall that the Institute of Medicine's <a href="http://www.iom.edu/Reports/2009/Conflict-of-Interest-in-Medical-Research-Education-and-Practice.aspx">report on conflicts of interest in medicine and health care</a> defined conflicts of interest as “circumstances that create a risk that professional judgments or actions regarding a primary interest will be unduly influenced by a secondary interest.” While no particular conflict of interest is guaranteed to cause someone to abuse entrusted power, conflicts of interest create the risk of such abuse. The case of the leadership and governance of Wyckoff Heights Medical Center shows how such risks may manifest. Yet we have noted again and again how leaders of supposedly mission-oriented non-profit medical organizations seem to be ignoring these risks while pursuing ever more money from health care corporations. We <a href="http://hcrenewal.blogspot.com/2012/02/logical-fallacies-in-defense-of.html">noted</a> how the Chancellor of the University of California-San Francisco "has no qualms" about faculty's financial relationships with industry. Just this week at Brown University, my alma mater, while discussing a new conflicts of interest policy, we <a href="http://www.browndailyherald.com/conflict-of-interest-policy-shifts-responsibility-to-u-1.2718709#.T3HWwdnefao">heard</a>, <blockquote>'People do have conflicts of interest, and it’s not the end of the world,' said Janet Blume, associate dean of the faculty. </blockquote>Conflicts of interest may not lead to the apocalypse. However, they certainly may lead to all sorts of unpleasantness. As Joe Collier <a href="http://bmj.bmjjournals.com/cgi/content/full/332/7555/1447">stated</a>, “people who have conflicts of interest often find giving clear advice (or opinions) particularly difficult." Conflicts of interest clearly lead to conflicted, and confused thinking, and such thinking may lead to bad decisions, and hence bad outcomes for patients' and the public's health. Worse, as the IOM asserted, conflicts of interest are a risk factor for outright corruption. True health care reform might start with a reasoned discussion, based as much as possible on evidence, about the risks as well as the supposed benefits of conflicts of interest affecting those who make decisions about individual patients' health care, and about public health and health care policy.

Another Cautionary Tale about Conflicts of Interest: the CEO's Stretch Limousine, Golden Parachute, and Slush Fund

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27 Mar 2012

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