REGULAR MEETING OF THE BOARD OF MANAGERS Tuesday, Board Room University Center for Community Health 701 S. Zarzamora Minutes BOARD MEMBERS PRESENT Robert Jimenez, M.D., Chair James R. Adams, Vice Chair Robert Engberg Mary Beth Williamson Luis Roberto Vera, Jr., J.D. Joe D. Edmonson Alexander E. Briseño BOARD MEMBERS ABSENT OTHERS PRESENT Jeff Turner, President/ Chief Executive Officer, University Health System John Blandford, Vice President, Information Services, University Health System Linda Boyer-Owens, Vice President, People & Organizational Development, University Health System Francine Crockett, Administrative Director, Purchased Resources, University Health System Theresa DeLaHaya, Vice President, University Center for Community Health and Prevention Services Steve Enders, Senior Vice President, Ambulatory Services, University Health System Roe Garrett, Vice President/Controller, University Health System George B. Hernandez, Jr., Executive Vice President/Assistant Administrator, University Health System Leni Kirkman, Public Relations Coordinator, University Health System David Knatow, M.D., Medical Director, Emergency Center, University Hospital Celia Kaye, M.D., Ph.D., Professor & Chairman, Department of Pediatrics, and Vice Dean, Office of the Medical Dean, UTHSCSA Charles L. Kight, President/CEO, Community First Health Plans, Inc. Mary Ann Mote, Chief Revenue Officer, University Health System Joe Naples, M.D., Professor & Chairman, Department of Anesthesiology, UTHSCSA
Page 2 of 11 Nancy Ray, Associate Administrator, University Hospital Richard Rodriguez, Assistant Administrator, University Hospital Greg Rufe, Administrator, University Hospital Rudy Urby, M.D., M.P.H., President/Chief Executive Officer, Community Medicine Associates And other attendees. MEMBERS OF THE PRESS Cindy Tumiel, Medical Reporter, San Antonio Express-News CALL TO ORDER Dr. Jimenez called the meeting to order at 6:03 p.m. INVOCATION AND PLEDGE OF ALLEGIANCE The Reverend Dr. Sarah F. Davis provided the invocation and Dr. Jimenez led the pledge of allegiance. SPECIAL RECOGNITION: (A) EMPLOYEE OF THE 4 TH QUARTER AWARDS The following Employees of the Quarter received recognition at the Board meeting: Professional: Ruby Rowena S. Reilly, Patient Care Coordinator, Obstetrics, University Hospital Management: Susan D. Gerhardt, Administrative Director, Patient Care Services, Surgery ICU, University Hospital Technical: Raquel S. Martinez, Radiologic Technologist III, Radiology Diagnostics, University Hospital Clerical: Service: Dolly D. Godley, Unit Secretary Coordinator Janelle Sneed, Medical-Surgical Technician, Obstetrics, University Hospital CITIZEN'S PARTICIPATION Mr. Abelardo Valdez, a Spanish-speaking resident of Bexar County, addressed the regarding the pharmacy co-payment increase required of CareLink members. He spoke on behalf of the people, specifically the elderly, in the community who cannot afford the increases. Ms. Julie Marquez translated for Mr. Valdez. Dr. Jimenez assured Mr. Valdez that there are special policy provisions in place so that certain medications will be made available to CareLink members in emergency situations regardless of federal poverty level. Certain
Page 3 of 11 members will be asked, but not required, to make the co-payments, and children will not be denied medications regardless of a parent s unwillingness to pay. Mr. George Hernandez will work with Mr. Valdez to help him better understand these provisions. Mr. Jaime Martinez, United Farm Workers (AFL/CIO), expressed opposition to the recent Board approval of a $90,000 contract for advertising with KENS 5 TV, because the University Health System is mandated to provide health care to the indigent people of Bexar County. He thanked the for striving to help the poor people, and expressed confidence that the Board would continue to meet the unique health care needs of this population. Ms. Julie Marquez, United Farm Workers (AFL/CIO), expressed gratification with Dr. Jimenez s response to the concern brought forth by Mr. Abelardo Valdez. She invited the to keep her organization informed about such policy issues and to visit the new local AFL/CIO branch office at 1502 S. Flores. Dr. Jimenez reassured the citizens present that the is always cognizant to the health care needs of the indigent by making all health care policy decisions in open meetings. Regarding the pharmacy co-payment increases, staff solicited feedback from Communities Organized for Public Services (COPS) and Metro Alliance and worked with both organizations to publicize the increases. The new co-payments are significantly lower than those of other Texas hospital districts and the University Health System has not raised pharmaceutical co-payments for the past six years Further, Dr. Jimenez clarified for Ms. Marquez and Mr. Valdez that the Board of Managers, not the Bexar County Commissioners Court, is the governing body responsible for implementing such policy changes at the University Health System. APPROVAL OF MINUTES OF PREVIOUS MEETINGS CONCLUSION: The minutes of the regular Board meeting of December 18, 2001 were presented for approval. RECOMMENDATION: Dr. Jimenez recommended approval of the minutes as submitted. A MOTION for approval of the recommendation was made by Mrs. Williamson and SECONDED by Mr. Edmonson. EVALUATION: FOLLOW-UP: REPORT FOM THE PRESIDENT OF THE HEALTH SCIENCE CENTER DR. FRANCISCO CIGARROA CONCLUSION: Dr. Celia Kaye reported that Dr. Cigarroa was not present this evening because he and Mrs. Cigarroa were hosting a dinner to
Page 4 of 11 RECOMMENDATION: EVALUATION: FOLLOW-UP: honor the 2002 Presidential Award winners of various categories. In the Clinical Excellence arena the awardees are Donald Currie, M.D., Associate Professor, Department of Rehabilitation Medicine; Lynda T. Wells, M.D., Associate Professor, Department of Anesthesiology; and Anastacio M. Hoyumpa, M.D., Professor, Department of Medicine; and Patricia Wathen, M.D., Associate Professor, Department of Medicine. This report was presented for information and no action was required. Dr. Kaye thanked the for their support on behalf of all clinicians. Mr. Turner will send congratulatory notices to the Clinical Excellence Award winners on behalf of the. REPORTS OF STANDING COMMITTEES UNFININSHED BUSINESS NEW BUSINESS A. CONSIDERATION OF APPROVAL OF RECOMMENDATIONS AND ACCEPTANCE OF REPORTS IDENTIFIED AS CONSENT AGENDA ITEMS: CONCLUSION: Seven (7) items were presented for approval on the consent agenda: 1. Report from the President of the Medical-Dental Staff - William E. Strodel, M.D. (a) Consideration of Medical-Dental Staff Recommendations Regarding Staff Membership (b) Approval of Christopher Bracken, M.D., as Executive Committee Member-at-Large 2. Report on Emergency Center and Walk-In Services Greg Rufe 3. Consideration of Delegation of Out-of-State Medicaid Application Signature Authority to the Vice President/Chief Revenue Officer Peggy Deming 4. Consideration of Appointments to the University Health System Pension Plan Board of Trustees Jeff Turner 5. Consideration of Policy on Grievance Process for Complaints Concerning Quality of Care and Services, No. 9.0601 Jeff Turner 6. Report on Appointment of Investment Officers Jeff Turner 7. Purchasing Activities Francine Crockett EVALUATION: The following items were pulled for discussion:
Page 5 of 11 Item No. 4 Mr. Edmonson requested a briefing to the Board of Managers regarding the status of University Health System s Pension Plan, in view of the Enron Bankruptcy scandal. Item No. 5 Mr. Briseño briefly reviewed the changes to the policy, and agreed that the revisions addressed his concerns. He pointed out an additional change, which is the periodic reporting of trends in this area to the. RECOMMENDATION: Staff recommended approval of the items listed on the consent agenda. A MOTION for approval of staff s recommendation was made by Mr. Adams and SECONDED by Mr. Edmonson FOLLOW-UP: B. ITEMS RELATED TO PLANNING & OPERATIONS 1. CONSIDERATION OF RECOMMENDED CHANGES TO THE MISSION STATEMENT AND MAJOR STRATEGIES FOR 2002 JEAN SETZER, PH.D. CONCLUSION: In early November during a strategic planning retreat, the Board of Managers recommended revisions to the Mission and Strategic Initiatives for 2002-2003. On November 27, Board members were invited to review the revisions and communicate any additional recommended changes. One recommendation was made to delete the last phrase all within the financial resources available in the mission statement because it is an assumed business practice. No other recommendations were made to modify the work produced at the retreat. The proposed statement reads as follows: The mission of the University Health System is to promote the good health of the community by providing the highest quality of care to both inpatients and outpatients; by teaching the next generations of health professionals; and by supporting research thereby advancing knowledge and improving the delivery of patient care. RECOMMENDATION: Staff recommended approval of the revised document and mission statement.. A MOTION for approval of the recommendation was made by Mrs. Williamson and SECONDED by Mr. Briseño. EVALUATION: FOLLOW-UP: 2. WORKFORCE ENHANCEMENT UPDATE LINDA BOYER-OWENS CONCLUSION: Ms. Boyer-Owens provided an update on the progress and results achieved towards the number one Strategic Action Plan priority for 2002. She reviewed vacancy reductions, which have dropped to an all time low of 4.2%. One hundred
Page 6 of 11 RECOMMENDATION: EVALUATION: employees were awarded UHS Foundation Nursing Scholarships in 2001. On January 10, the University Health System entered into a partnership to expand San Antonio College Nursing School enrollments, which have already increased by 58 students this semester. The St. Philips Nursing Education Department is working toward approval of a similar partnership that is projected to double their enrollment of students in its LVN to RN degree program. The UTHSCSA School of Nursing continues its work with faculty and the Board of Nurse Examiners to finalize an extension campus agreement with the University Health System. The Hire-Up Team is now actively engaged in the development of long-range staffing and placement strategies. Part of the $11.5m designated to support the 2002 Workforce Enhancement Fund was put to work on January 21 to implement competitive pay adjustments for 24x7 bedside staff nurses, respiratory therapists, radiology professionals, and surgical techs. The first steps were also taken on that day to implement a living wage of $8.25/hour on April 1 st. Forty-two employees will host 42 local high school student shadows by serving as mentors for Junior Achievement s National Groundhog Job Shadow Day on February 1. The University Health System is the first and only healthcare provider in the local community to serve in this role. This report was provided for informational purposes. No action was required by the. Mr. Edmonson is pleased with the progress made thus far and proud that the University Health System workforce is the Board of Manager s number one priority for 2002. He praised Ms. Boyer- Owens, Ms. Ray, and their staffs for the fantastic and expedient job in addressing work force issues. Mr. Adams sees the living wage increase as an opportunity to hire a quality work force. Dr. Julian Trevino of the San Antonio Independent School District, reported to Dr. Jimenez that he is thrilled with pipeline efforts for high school students. Dr. Jimenez noted an opportunity to increase enrollment for the UTHSCSA School of Allied Health Sciences, as well as an opportunity to recruit more men into the allied health and nursing professions. Mr. Briseño asked how the work force progress would impact other areas of concern, such as, the surgical ICU bed capacity issue, and relocation of specialized services to other facilities. ICU beds are now available and staff will research how to better manage bed capacity to gain an improved understanding of all the issues involved. FOLLOW-UP: Ms. Boyer-Owens will provide high school scholarship proposal information to Mr. Adams. Mr. Turner will outline for the Board of Managers the positive impact of the work force enhancement plan on areas of concerns, such as those raised by Mr. Briseño.
Page 7 of 11 C. ITEMS RELATED TO BUDGET & FINANCE 1. REPORT ON MEDICATION ASSISTANCE PROGRAM SUCCESS GEORGE B. HERNANDEZ CONCLUSION: In 2001 the Pharmacoeconomics Department obtained free medications worth $7,851,720 for our indigent and needy patients. Through the Medication Assistance Program (MAP) UHS filled 52,231 prescriptions for 13,797 patients. The personnel costs for 2001 were $358,086; this represents a 22:1 return. Previously, in 2000, UHS obtained $3,030,058 in free medications. As a result, the citizens of Bexar County have received the benefit of almost $11 million in free medications over the past two years. Medications are valued at our actual acquisition costs. RECOMMENDATION: EVALUATION: This department has grown from one employee to eleven reimbursement specialists and one manager, all of whom work with both CareLink and the Pharmacy Department. Specialists staff every University Health System pharmacy location. Efforts are focused on the higher cost formulary medications; currently the CareLink formulary consists of 689 medications approved by the Pharmacy & Therapeutics Committee. On a national level there are 176 companies providing 1,036 medications through Medication Assistance Programs. Medications are continually being added and deleted from these programs, which makes our budgeting somewhat difficult. For 2002, barring any dramatic changes from the pharmaceutical companies; it is believed that UHS will be able to obtain $8 million worth of free medications for its indigent and needy patients. Staff will continue to work closely with the pharmaceutical companies to streamline the actual processes, and hope to expand the use of these programs. While these programs exist because the pharmaceutical industry has established them, much of our success is also attributable to the cooperation of our physicians and patients, and the hard work of our conscientious employees. This report was presented for information purposes only and no action was required. Mr. Adams and Dr. Jimenez propose using a strategy which highlights the CareLink financial assistance program as a lead to enhance current working relationships with the pharmaceutical industry. The would like to participate in this process.
Page 8 of 11 FOLLOW-UP: Mr. Hernandez will approach the University Health System Foundation about hosting an event to honor senior pharmaceutical executives whose companies currently participate in the Medication Assistance Program. 2. CONSIDERATION OF FINANCIAL/OPERATIONS REPORTS FOR DECEMBER 2001 PEGGY DEMING CONCLUSION: Ms. Deming reviewed December 2001 results and reported an extensive close process this month with a goal to minimize audit adjustments. She compared bottom line loss of $3.6m to budgeted $0.5 m loss, operating loss of $3.8m was $2.2m higher than budget, and unrealized loss offset most of investment income for month. She reviewed balance sheet changes and attributed improvements to cash and investments up to $6.4m; A/R down $5.2m; reserves up $3.3 m; A/P down $2.8m; and specified donations increased $0.8m. As declines on the balance sheet she cited net property, plant and equipment ($13.8m); and unrestricted fund balance ($7.4m). EVALUATION: Mr. Adams is pleased with the good results and quality of the numbers. He commended Ms. Deming for substantially improving the details and background information that is provided to the Board. Mr. Turner attributed the positive collections turnaround to the IDX system and the competent staff charged with increasing revenue. RECOMMENDATION: Staff recommended that the Board accept these reports subject to audit. A MOTION for approval of the recommendation was made by Mr. Briseño and SECONDED by Mr. Edmonson. FOLLOW-UP: Mrs. Williamson requested a University Health System Foundation report which summarizes donor names and addresses for the purpose of acknowledging the contributions on behalf of the, since the general public does not distinguish between the University Health System Foundation Board and the. 3. REPORT ON MULTI-YEAR FINANCIAL & OPERATIONAL PLAN DEVELOPMENT JEFF TURNER CONCLUSION: RECOMMENDATION: EVALUATION: Senior staff continues to work to provide the a recommended financial and operating plan for 2002 through 2004. The first priority is to implement the initiatives contained in the 2002 capital and operating budget as the first phase of a multi-year plan. Action plans labeled as Accountable Management Actions in the 2002 budget have been completed and are being implemented. This report was provided for information only.
Page 9 of 11 FOLLOW-UP: 4. CONSIDERATION OF AGREEMENTS WITH THE UNIVERSITY PHYSICIANS GROUP AND THE UNIVERSITY OF TEXAS HEALTH SCIENCE CENTER GEORGE HERNANDEZ CONCLUSION: Provisions of two major agreements for medical services, the Annual Operating Agreement and an Extension Agreement of seven Professional Health Care Support and Coverage Agreements (Based Care Provider Agreements) with the University Physicians Group (UPG), were summarized by Mr. Hernandez for the : The Annual Operating Agreement compensates UTHSCSA for physician residency support, administrative services and patient care service personnel. Senior staff of the University Health System and The University of Texas Health Science Center have negotiated the financial terms of the Annual Operating Agreement for 2002. The 2002 agreement is $326,605 less than the 2001 agreement, a 3.1% decrease. This decrease is primarily due to a reduction in house staff medical malpractice costs. Admin/Mgt. Of Residency Programs $1,475,976 Physician Administration $3,741,547 Patient Care Services Personnel $4,022,747 House staff Medical Malpractice $1,185,000 Total Amount of Contract $10,425,270 The seven Professional Health Care Support and Coverage Agreements listed below support direct patient care services. All agreements are reviewed, negotiated, and approved by the Health System annually with the University Physicians Group (UPG). The Extension Agreement extends these seven agreements for 120 days at the new 2002 negotiated amount. However, the cost difference between the 2001 and the 2002 has not been allocated on a per contract basis. Instead, the per contract cost to the Health System during the extension period remains fixed at the 2001 rates. At UPG s request, the negotiated increase for 2002 prorated for the 120 day extension, remains unallocated to allow UPG better flexibility to cover shared physician group expenses and certain physician services which are not presently directly compensated by the Health System. The unallocated extension cost is $1,278,909. The extension value of the existing seven Based Care Provider Agreements is $5,630,765. The total value of this Extension Agreement is $6,909,674. Staff plans to bring new Professional Health Care Support and Coverage
Page 10 of 11 Agreements to the Board for its consideration no later than the April Board meeting. The Based Care Provider Agreements extended are: Contract Description 2001 Annual Extension Number Compensation $ Value 2101040-IE Medicine $ 3,061,400 $1,020,467 2101041-IE Pediatrics $ 2,351,380 $ 783,793 2101042-IE Surgery $ 4,505,220 $1,501,740 2101044-IE Family Practice $ 1,535,150 $ 511,717 2101045-IE Supp. Health Svcs. $ 1,143,492 $ 381,164 2006363-IE Transplant Support $ 500,000 $ 166,667 2103289-IE Anesthesiology Support $ 3,795,651 $1,265,217 Total $16,892,293 $5,630,765 RECOMMENDATION:Staff recommended that the Board approve and authorize the President/CEO to execute the Annual Operating Agreement with UTHSCSA and the Extension Amendment to the Professional Health Care Support and Coverage Agreements with UPG. A MOTION for approval of the recommendation was made by Mr. Vera and SECONDED by Mr. Adams. FOLLOW-UP: COMMUNICATIONS Mr. Turner reported that the University Hospital JCAHO score has been updated to 94. The updated score reflects the activity to correct the Type 1s during the Focus Survey in September 2001 and the scoring. A score of 94 is the maximum score an organization may receive for corrected Type 1s. In a CNN survey, San Antonio ranked 2nd in the nation with respect to emergency preparedness. Mr. Turner thanked the staff and physicians who were involved in these efforts. Mr. George Hernandez briefed the Bexar County Commissioners Court today regarding the alert issued in December 2001 by the Texas Health and Human Services Commission to stakeholders about the possibility of major changes in the Children s Health Insurance Program resulting from program costs exceeding budget appropriations. The projected shortfall, estimated to be $20.4 million, is due to higher than expected enrollment. Since the CHIP program is matched 3 to 1 by federal dollars, the total impact could approximate $80 million. Changes in CHIP program design could have negative impact on the 39,000 Bexar County children, University Health System s indigent and CareLink program, as well as local health system providers. Commissioners Court unanimously passed a Resolution communicating their concerns to the Texas legislature. Board members agreed that additional political work would be needed and several are
Page 11 of 11 willing to address the appropriate leaders in Austin, including Governor Perry, who has expressed a great interest in CHIP. ADJOURNMENT There being no further business, the public meeting adjourned at 7:54 p.m. The Board of Managers went into a closed session to evaluate the quality of medical and/or health care services as permitted by Section 161.032 of the TEXAS HEALTH & SAFETY CODE. Robert Jimenez, M.D. Chairman Joe Edmonson Secretary Sandra D. Garcia, Recording Secretary