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HEALTH
AFFAIRS COMMITTEE
Friday, May 29, 1998
8:30 - 9:15 a.m.
East Oval Room, The Rotunda
Committee Members:
Charles
M. Caravati, Jr., Chair
Terence P. Ross
William G. Crutchfield, Jr.
Albert H. Small
William H. Goodwin, Jr.
Joseph E. Wolfe
T. Keister Greer
John P. Ackerly, III, Ex Officio
AGENDA
- I.A.
Approval of Conflict of Interests Regarding UVA/Health Services
Foundation Contracts
- BACKGROUND:
The University of Virginia Health Services Foundation (HSF) was
organized in 1981 as the clinical "faculty practice plan" for
the physician faculty members of the School of Medicine. The purpose
of the Foundation is to support medical education at the University
and to help attract and retain highly qualified University faculty
by establishing a group practice, within which faculty may provide
clinical services to patients and train medical students.
- DISCUSSION:
Clinical faculty in the School of Medicine are employees both
of the University for their teaching, research and administrative
work, and of the Foundation for their clinical practice. Because
they are paid by HSF for their clinical work, the School of Medicine
clinical faculty have a "personal [i.e. financial] interest" in
the UVA/HSF contractual relationship as defined in the Virginia
State and Local Government Conflict of Interests Act. The Act
generally prohibits a state employees having a "personal interest"
in contracts between his state agency employer and any other entity
from which he receives compensation. An exemption is made, however,
by section 2.1-639.6(C)(6), for personal interests of faculty
in contracts between state schools of medicine and their faculty
practice plans, subject to approval by the schools board of visitors
on or after July 1, 1998.
- The
following resolution approves the personal interests of School
of Medicine faculty arising from their clinical income interest
in HSF, which serves the University as its group practice plan.
- ACTION
REQUIRED: Approval by the Health Affairs Committee and the Board
of Visitors.
-
APPROVAL OF CONFLICT OF INTERESTS REGARDING UVA/HEALTH SERVICES
FOUNDATION CONTRACTS
- The
President will propose the adoption of the following resolution:
- WHEREAS,
the Virginia State and Local Government Conflict of Interests
Act permits and exempts personal interests of medical faculty
in contracts between a state institution of higher education which
operates a school of medicine and its physician faculty practice
plan (the group practice organization through which faculty conduct
their clinical practice); and
-
WHEREAS, the Universitys faculty practice plan, the Health Services
Foundation, supports the Universitys medical education programs
by serving as the group clinical practice organization for the
School of Medicine faculty, allowing them to maintain and convey
their skills to medical students within the Medical Center and
related clinics, and by providing compensation that helps to attract
and retain highly qualified faculty;
-
RESOLVED, as permitted by the Act, the Board of Visitors hereby
approves the personal interests of School of Medicine faculty
arising from their clinical income interest in the Health Services
Foundation, which serves the University as its group practice
plan.
- II.
Medical Center Compensation and Benefits Program
- BACKGROUND:
The Board of Visitors in June of 1996 adopted an "interim" Medical
Center Personnel System as part of the Codified Autonomy legislation
to allow management the opportunity to develop a Personnel (Human
Resources) System aligned with the health care industry. The "interim"
Personnel System mirrored the Personnel System of the Commonwealth.
The Medical Center retained the human resources consulting firm
Watson-Wyatt to assist in the design of a new Human Resources
System. Changes to the Compensation, Benefits and Retirement programs
of the Human Resources System must be presented to the Board of
Visitors for its review and approval.
- DISCUSSION:
The Human Resources System is being designed to align our policies
and practices more closely with others in the health care industry.
Health care is a business and our customers have choices as to
where they go for services. Because more than half of our costs
of operations are for the salaries and benefits of employees,
the Medical Center must ensure that compensation and benefits
programs are designed to keep our costs competitive.
- The
Compensation Program is designed to be competitive with programs
used by other health care organizations. It is designed with flexibility
so that we can accommodate several different salary plans within
a single compensation program. It incorporates compensation practices
that will allow us to recruit and retain a competent workforce.
- The
Codified Autonomy legislation required the Medical Center to continue
to make available the Virginia Retirement System (VRS) and the
VRS group life, accidental death, dismemberment and disability
insurance programs. The legislation also allowed the Medical Center
to design its own optional retirement programs and to offer other
benefits programs. The Medical Center has expanded the Flexible
Benefits,
- Optional
Retirement and Paid Time Off Leave programs, previously available
only to Health Care Professionals, to all qualified employees.
- The
Medical Center will continue to work with the President on the
development and implementation of the Human Resources System for
which the Board of Visitors delegated authority.
- ACTION
REQUIRED: Approval by the Health Affairs Committee and the Board
of Visitors.
MEDICAL CENTER COMPENSATION AND BENEFITS PROGRAM
- The
President will propose the adoption of the following resolution:
-
WHEREAS, the Codified Autonomy legislation allowed the Medical
Center to develop a Compensation and Benefits program aligned
with the health care industry; and
- WHEREAS,
the Compensation and Benefits Program will have a phased implementation
between July and December of 1998, to allow for orientation and
education of management and staff; and
- WHEREAS,
the Board of Visitors reserves the right to amend these plans
and to govern and manage the affairs of the University of Virginia
Medical Center at all times;
- RESOLVED
that the Medical Center Compensation and Benefits Program Policy
Statement is approved, subject to the foregoing
- III.A.
Medical Center Financial Report - March 31, 1998
- BACKGROUND:
The University of Virginia Medical Center prepares a quarterly
operating and financial report for management and Board review.
These reports are reviewed with the Executive Vice President and
Chief Financial Officer before they are sent to the Health Affairs
and Finance Committees of the Board of Visitors.
- DISCUSSION:
At end of third quarter, the Medical Center continues to experience
strong levels of inpatient occupancy, outpatient activity, and
very high patient acuity. As expected and projected in the budget
amendment submitted to the Health Affairs Committee January 23rd,
1998, these factors have continued to result in higher revenues,
expenses, and staffing.
- As
reported last quarter, new accounting procedures and systems continue
to allow the Medical Center to report actual revenues and expenses
in a more timely and effective way. Through March, total operating
revenues have exceeded the budget as amended by $1.9 million despite
substantial increases in contractual allowances required by third
party payors.
- Through
March, total operating expenses, due to growth in volumes and
acuity, have exceeded the budget as amended by $5.2 million, driven
primarily by growth in the cost of high-tech drugs and medical
supplies. Programs aimed at more aggressive medical management
of high cost drugs and supplies are underway.
- Projections
for the remainder of the fiscal year assume continued strong volumes
of activity, continued growth in managed care, and a reasonable
operating margin. The Medical Center is initiating a program of
cost reduction and revenue enhancement strategies.
- REQUIRED
ACTION: None.
- III.B.
Vice President's Remarks
- ACTION
REQUIRED: None.
- The
Vice President and Provost for Health Sciences will utilize this
portion of the Health Affairs Committee Meeting to inform the
Board of Visitors of recent events of the Health Sciences Center
which do not require formal action, but of which they should be
made aware.
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