Steel, Part 2 (Improving Our Footing? How About Our Feet?)     May 17, 2013

By Leonard Zwelling

            I
have tried to outline why our core business, patient care, is very much like
the steel business with huge fixed costs and the need for major investment if
business needs to grow. The major investments require capital which we seem to
be lacking at present although no one is quite sure why. The administration
blames the faculty and then penalizes the very people they want to work harder
(“The beatings will continue until morale improves”), by denying these hard
working people a merit raise.

            The
faculty claims the spending on research in IACS and new recruitments has been
profligate yet the administration still will not reveal what has been and
continues to be shifted from clinical revenues to the President’s pet projects.
It is hard to believe that the cost of the rumored packages for some basic
science recruits in the tens of millions were defrayed by CPRIT money alone.
How much of the sweat of the clinical faculty has been absorbed by the payouts
to the new biologists?

            Compounding
all of this is a lack of transparency about how each of us can further the plan
to conquer cancer, called the Moon Shot. There should not be haves and have
nots if this is really a strategic initiative. Everyone should know his or her
role. Do you know yours?

            But,
rather than pointing more fingers assuming what one side knows about the other,
let’s review the actual memo from the President for logic.

1.     “Fulfilling
year”? For whom?  Surely not for
the faculty who will not be receiving any merit pay for the “incredible work”
they have done.

2.     Growth
in operating expenses. Can we finally know what the heck is being spent on
IACS, new research recruitments, Global Programs, Sister Institutions and excess
salaries in the IACS? And where did the money to do all of this come from?

3.     6%
increase in new patients next year. Surely you jest. Why would anyone imagine
another boost in activity when the hospital is at capacity once a week and
there is still no reasonable electronic medical record or scheduling, billing
and coding systems to promote gains in efficiency?

4.     And
while we are at it, are we hiring more faculty to see patients or aren’t we?
And what about the ever-growing efflux of current faculty and the swelling ranks
of the LTL, likely to leave? How much does each new faculty member cost when
all costs including ancillary personnel are included and how much revenue does
that faculty member generate? Which side of the economies of scale curve are we
on? The ascending or descending (aka, dyseconomies of scale)?

5.     It
still looks to me like there is no real model for integrated hiring. It looks
like a guess that 6% growth in “upstream” providers, will be matched with only
a 3.4% growth in downstream clinicians. This sounds like a formula for a
downstream flood.

6.     “This
isn’t the first time we’ve had to make hard budget choices”. It isn’t? It looks
like it to us who have been around for the past 10 years of overspending on
stuff we didn’t need like research building after research building. Of course,
the choice not to acquire a sufficient electronic medical record, well-working
financial systems and information systems to manage research administration all
seem like decisions. Lousy ones, but decisions nonetheless.

7.     “Before
external challenges force us into crisis”. Are you kidding? We are there.
Again. The same crew that gave us the mismanagement of 2008-2009 is doing it
again.

            Come
on people. This is silly. We are all men and women of steel. We need to be led
by people worthy of our trust. We could improve our footing with leadership of
men and especially more women of steel and fewer with feet of clay and leaden
thinking.

Leonard Zwelling