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VPMA Voice

We had a very useful meeting with the Board of Regents last Wednesday to talk about the importance of UI Health Care to the state.

The session was part of the Regents’ strategic planning process, which included UI Health Care leaders along with the deans of the other health science colleges. Also participating in the discussion were health care “stakeholders” from around the state. From them we heard that they want us to continue to expand our missions of patient care, education, and research.

A point of consensus was the importance of ensuring the financial stability of UI Hospitals and Clinics and UI Physicians.
UI Health Care–like other academic medical centers–is facing serious financial challenges, and it has become apparent that we are not likely to reach our fiscal year 2009 budget goals.

We are continuing our expense reduction efforts, including slowing down some of our capital projects, until the economic outlook improves (see story, below). Although we are altering our pace, we continue to plan these facilities projects because they are essential to our pursuit of excellence and meeting the health care needs of Iowans, now and in
the future.

As the Regents complete their strategic plan, we will be finalizing UI Health Care’s integrated strategic plan, ensuring that we meet the expectations of the Board and Iowans. We anticipate sharing our final plan with all those who work, learn, or volunteer with UI Health Care very soon.

Signed, Jean Robillard

 

Follow-up from report to the Board of Regents

During last Wednesday’s report to the Board of Regents, Vice President for Medical Affairs Jean Robillard summarized the current financial and operational situation at UI Health Care by explaining several points of interest.

The possibility of achieving a 3 percent operating margin for the hospital in fiscal year 2009 has disappeared. At best we will break even for the year if patient volumes start to recover and remain strong until the end of the year. Reasons for this shortfall include:

  • Reduced reimbursement from a major payor
  • Change in payor mix for the hospital and UI Physicians, resulting in a decline in reimbursement from commercial sources and an increase in self-pay and IowaCare sources
  • Lower than budgeted patient volumes as people forego medical visits
  • Patients deferring elective surgery, typically covered by private insurance plans
  • Increased uncompensated care, which contributes to loss of revenue

If volume continues as it has for the past three months, there will be a significant operating loss for the fiscal year. In an attempt to avoid this, UI Health Care leaders, managers, and staff have been working hard since September to reduce costs, fund new programs critical to our mission, and still plan for the future. To date, we have:

  • Implemented expense reductions for an estimated savings of $20 million
  • Slowed hiring dramatically by examining vacancies and using internal transfers when appropriate rather than hiring additional staff
  • Right-sized several units as appropriate
  • Slowed the planning for capital projects, including the new children’s hospital and construction of a surgical platform

There is no question that these capital projects need to be done and are essential to our ability to deliver the best care to the people of Iowa. However, the economy must be stronger in order for us to complete them. Planning for the Iowa River Landing ambulatory care campus is proceeding at a prudent pace.

If revenues do not improve, expense moderation efforts will need to be accelerated to reverse the downward trend and be prepared for fiscal year 2010.

Despite these challenges, Robillard noted some positive news, including:

  • The potential for new funding from the federal economic stimulus package
  • Strong statements of support from prospective donors
  • Our quality and service continue to improve
    • We are now performing above the 90th percentile in treatment of Acute Myocardial Infarction nationally and exceed the “gold standard” for door-to-balloon time
    • Our surgical care infection rate continues to decline
  • Faculty continue to receive national and international honors

“In summary,” Robillard told the Board, “while we certainly recognize that we have significant challenges in the months ahead, UI Health Care is well-positioned to weather this current economic storm and emerge stronger than ever.”

23 UI grads will be resident physicians

Twenty-three of the 2009 UI Carver College of Medicine graduates will become resident physicians at UI Hospitals and Clinics, and an additional 11 graduates will remain in Iowa for their first year of postgraduate training. The students learned of their appointments Thursday of last week during what has become known as Match Day.

Geographically, the most popular state after Iowa for first-year residency training was California, where 13 graduating students will begin their residencies. Among this year’s graduating class of 143 students, 47 percent (67 students) chose primary care specialties. The two top non-primary care specialties were emergency medicine (11 matches) and anesthesiology (10 matches).

Supply chain award for UI Hospitals and Clinics

UI Hospitals and Clinics has been named a top five performer in the University HealthSystem Consortium 2009 Supply Chain Performance Excellence Collaborative Study. The study recognizes academic medical center members for excellence in supply chain management as measured by cost savings and efficiency in supply, pharmacy, cardiology, surgical services expense management, and operating margin.

Other academic medical centers honored were Denver Health, North Carolina Baptist Hospital (Wake Forest University Baptist Medical Center), Parkland Health and Hospital System, and University of Wisconsin Hospital and Clinics.

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