Hidden in Plain Sight: The MD Anderson “annual report 2015”

Hidden in Plain Sight: The
MD Anderson “annual report 2015”


Leonard Zwelling

         It makes fascinating reading, this “annual report” (lower
case letters on cover). But I’m like everyone else. First, I look at the

         I was shocked at how few of the faculty pictured in the
human interest stories were high ranking professors. Rather, a panoply of very
junior, obviously new, members of the faculty were there along with full page photos of Drs. Freireich and Fidler (almost 90 and almost 80) and some more
accomplished members of the faculty on pages 22 and 23. Page 37 had a picture
of an unidentified woman who works in the laboratory of one of the FORDs. My
favorite page is 45 where the mystery of who is in the “shaking heads”
commercial is solved with names associated with the people whose faces appear against
the white screen–finally. (Cancer Treatment Centers of America is proud to
identify the doctors in their commercial, one of who used to be an MD Anderson
faculty member. Why shouldn’t MD Anderson tell us who is in its commercial?)

         What was really revealing was all the way on page 79, the
financials. Here are some highlights:

·     81% of the revenue is from patient care. Nothing else
even comes close as a source of income for MD Anderson. The problem is the
number used by the report for “Gross patient revenue” is twice the actual
revenue as there is a deduction from the “gross revenue”  (i.e., billings) of $7.6 billion to reach
true net revenue which is really $3.6 billion. The $7.6B is what is billed not
what is collected. Or maybe I am confused because the label on the circle graph
as “net patient revenue ” uses the value given in the table above as gross revenue.
I did the calculation myself and the 80.8% of revenue is that obtained using
the correct number, the net, even though the number on the circle graph is that
of the gross revenue. Gross revenue is unassociated with real revenue. No wonder
no one can understand where the money goes.

·     The indigent care given away is 1% of the revenue
(gross, I think). Should MD Anderson really be tax exempt? If so, why? It is
giving away less than half the money it takes in from the state of Texas
($187.4M) putatively to care for the people of Texas. That is only $75M
according to MD Anderson’s own figures. (And I bet they had to fully allocate that
$75 at the gross billing rate not the true net revenue of about half that.)

·     The actual amount of philanthropy is tough to discern
as it is lumped in with dollars from grants and contracts.

·     Only 14.7% of revenue goes to support research. And I
thought this was a research institution. That is still a higher rate of investment in research than that of many drug
companies, but the companies spend more on marketing than they do on R and
D. How comforting! MD Anderson has a higher ethic than Pfizer.


suggest you read the annual report for 2015 and ask yourself one question: Is
this what I expect from the number one place for cancer care?

         I have
no idea what the right numbers ought to be, but I would expect that the annual
report would highlight the accomplishments of the professors and the financials
should be precise and clear. I don’t think this document is either of these two
things—precise or clear. That makes it a perfect reflection of the current
leadership of MD Anderson.

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