Page 32


UTMB’s John Sealy Hospital has reopened 200 beds, but not for the uninsured. Snyder says UTMB’s attitude toward treating the uninsured had begun to change in 2006. That’s when then-President John Stobo hired the Houston-based Navigant Consulting Group to examine the hospi tal’s financial situation. “We thought we were doing great,” Snyder says, “and then suddenly they started letting people go and we were a failing institution.” In a May 6, 2006, op-ed for the Galveston County Daily News, Stobo said the hospital was in the black. UTMB, he said, had “successfully addressed a series of financial challenges, including significant budget cuts from the state, decreasing reimbursement from Medicare and Medicaid, and medical inflation increasing at twice the inflation rate:’ But UTMB was reeling from steep budget cuts made by the Texas Legislature in 2003. Looking at a $10 billion budget deficit, legislators began to eliminate programs across the state. At UTMB, the $20 million per year in unclaimed lottery money that the Legislature had appropriated for indigent health care was cut in half. The Legislature also cut another $31 million through Medicaid rate reductions and the elimination of the Medicaid Graduate Medical Education program. Stobo’s administration was still moving full steam ahead, however, with its $61 million specialty care center near Victory Lakes. Four months later, in September 2006, the Navigant report was completed, and Stobo was singing a different tune. He told the Daily News that the hospital had a $20 million annual operating deficit. Stobo announced that UTMB would have to let go 1,000 employees through layoffs, attrition and early retirement. One focus of the Navigant report was DAMP. “Through DAMP:’ the consultants wrote, “the UTMB medical community has successfully placed controls on access for new patients except in the Emergency Department”where, by law, the uninsured have to be admitted. The consultants ended their assessment thusly: “The value of the DAMP program is measured in respect to number and percent of persons denied access to care:’ Navigant’s conclusion was clear: Fewer indigent patients should be UTMB’s goal. Hospital documents show officials in July 2008 working up a telephone script to help administrative staffers turn away uninsured patients. In e-mail messages sent to UTMB’s top administrators, Beverly Dowling, interim assistant vice president for Community Health Networks and manager of DAMP, suggested responses to potential complaints from rejected applicants. Among the anticipated complaints: “You are trying to kill me,” and “If you do not take me I will die:’ According to Dowling’s message, UTMB’s response would be as follows: “I hear you and I know that you are frustrated. The UTMB health system is currently caring for as many unsponsored patients as we can. Unfortunately, we have exhausted the funding available for unsponsored care and are unable to accept any more new patient referrals at this time. I encourage you to call your PCP/referring physician or your local county office for help with your immediate health care needs:’ UTMB ultimately posted a $614,000 deficit in its 2008 financial report. Meanwhile, UTMB was authorized by the UT Board of Regents to spend $10 million in cash buying an additional 29 acres for the Victory Lakes medical facility. The cash came from funds generated by treating patients at the hospital and clinics, money that would normally be designated to pay faculty who treat the uninsured. UTMB had now purchased 64 acres in League City all toldjust 20 acres less than the campus on Galveston Island. In a July 16, 2008, e-mail message, former CFO Larry Revill wrote to President David Callender and Provost Garland Anderson, “Another thing to consider would be to shift the funding source of Victory Lakes from cash to debt financing. This would definitely help our cash position but we would have to jump through some hoops at System and get BOR \(Board want to let me know.” 18 THE TEXAS OBSERVER MARCH 20, 2009