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. CONSENT AGENDA

Conflict of Interest Exemption

II. REPORTS BY THE VICE PRESIDENT AND PROVOST FOR HEALTH SCIENCES (Dr. Cantrell)

Medical Center Financial Report (as of September 30, 1998)
(Dr. Cantrell to introduce Mr. Carter; William E.[Nick] Carter, Jr. to report)

Vice President's Remarks

III. EXECUTIVE SESSION

Discussion of proprietary, business related information of the Medical Center in connection with its proposed and existing joint ventures, and the investing of public funds where competition and bargaining is involved, when if made public initially the financial interests of the University would be adversely affected; and consultation with legal counsel and briefing by staff members pertaining to probable litigation and other specific legal matters requiring the provision of legal advice by counsel; as provided for in Sections 2.1-344 (A)(6), (7) and (24) of the Code of Virginia.

I. Conflict of Interest Exemption

BACKGROUND: The School of Medicine's Office of Continuing Medical Education (CME) is preparing a new internet-based CME program in cardiology called the "Cardiovascular Cybervillage". This interactive educational World Wide Web site will provide the latest and most accurate information available on cardiovascular medicine in a user friendly format. A major pharmaceutical company is interested in underwriting the entire cost of this program.

This web site's unique features facilitate customized learning. Its case-based format includes patient scenarios to communicate strategies for effective management of cardiovascular problems and requires choices about these teaching cases based on peer-reviewed practices and standards of care.

DISCUSSION: The Cardiovascular Cybervillage is based on a database software application developed by CardioConcepts, Inc., a local, privately owned company. This application will manage the retrieval and sequencing of images and medical content developed through the Office of Continuing Medical Education and the School of Medicine's Cardiovascular Division. To offer the Cardiovascular Cybervillage as a CME program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts for the licensing of the application and its continued development. Because CardioConcepts is owned by two University faculty members, Lawrence Gimpel, M.D. and Ralph Buckley, M.D., the agreement would constitute a violation of the Virginia Conflict of Interests Act's general prohibition on contracts between state agencies and their employees, unless it is approved pursuant to the exemption to the Act as enumerated in the Code of Virginia, Section 2.1-639.6(C)(7). This exemption requires approval by the Board of Visitors. If the exemption is approved, the terms of the agreement will be negotiated by the Universitys Director of Purchasing, in accord with applicable Public Procurement Act requirements.

ACTION REQUIRED: Approval by the Health Affairs Committee and by the Board of Visitors.

CONFLICT OF INTEREST EXEMPTION

The President will propose the adoption of the following resolution:

WHEREAS, the School of Medicine Office of Continuing Medical Education wishes to offer an internet-based program in cardiology titled the "Cardiovascular Cybervillage"; and

WHEREAS, to offer the Cardiovascular Cybervillage program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts, Inc., a company owned by two faculty members, Lawrence Gimpel, M.D., and Ralph Buckley, M.D., for the licensing and further development of the Cardiovascular Cybervillage software application; and

WHEREAS, entry into an agreement with CardioConcepts may be entered into under the exemption to the Virginia Conflict of Interests Act as provided in Section 2.1-639.6(C)(7) of the Code of Virginia, with approval by the Board of Visitors; and

RESOLVED that the exemption under Section 2.1-639.6(C)(7) of the Code of Virginia for the proposed agreement between the University and CardioConcepts, Inc., for licensing and development of the "Cardiovascular Cybervillage" application, is approved.

II.A. University of Virginia Medical Center Financial Report as of September 30, 1998

BACKGROUND: The Medical Center prepares a quarterly financial report and reviews it with the Executive Vice President and Chief Financial Officer before submitting the report to the Health Affairs Committee of the Board of Visitors. The Health Services Foundation (HSF) prepares and presents financial statements to the HSF Board and to the Vice President and Provost for Health Sciences.

The following financial report was sent to the Board of Visitors in a December 1998 interim mailing from the Executive Vice President and Chief Financial Officer.

DISCUSSION: At the end of the first quarter, gross inpatient revenue was 3.9 percent less than budget and gross outpatient revenue was 2.0 percent less than budget. The Medical Center has experienced a decrease in indigent care ($2.7 million less than budget year-to-date) that offsets an increase in bad debt ($1.1 million greater than budget year-to-date). In addition, the Medical Center is experiencing better than expected contractual adjustments resulting in a $3.6 million favorable comparison to budget. These activities, in combination with slightly better than budgeted miscellaneous revenue, result in total operating revenue being $1.8 million better than budget.

Expenses are higher than budget (as approved for the first 3 months) primarily because of the cost in the category of Medical Supplies and Pharmaceuticals, which represent $2.5 million of the variance from budget. Purchased Services & Other expenses represent another $1.6 million of the variance. Salaries & Fringe Benefits, Medical Center Contracts, and Depreciation & Amortization partially offset variance. As a result, total expenses, including bad debt, are $3.9 million over budget. This more than offsets net operating revenue position to arrive at an operating margin of 3.7% of net operating revenue and $2.2 million less than budgeted.

In general, the financial position at the end of the first quarter is less than optimal. Lower than budgeted gross inpatient and outpatient revenues have been experienced despite higher than budgeted volumes. Although this is offset by favorable indigent and contractual adjustments, the higher volumes cause there to be higher than budgeted expenses. The resulting operating margin positions the Medical Center poorly for the remainder of the year as it faces increased costs and decreased reimbursements amidst rising volumes.

The commitment to achieving a 6.0 percent operating margin holds firm, albeit unlikely given the first quarter financial results. In response to this situation, the Vice President and Provost for Health Sciences and the entire staff of the Medical Center continue to work toward ensuring aggressive medical management, cost containment, and process improvement with an emphasis on both quality patient care and lower cost.

REQUIRED ACTION: None.

University of Virginia Medical Center Income Statement Quarter Ending 9/30/98

Balance Sheet Quarter Ending 9/30/98

Financial Ratios Quarter Ending 9/30/98

Operating Statistics Quarter Ending 9/30/98

Income Statement Quarter Ending 12/31/98

Balance Sheet Quarter Ending 12/31/98

Financial Ratios Quarter Ending 12/31/98

Operating Statistics Quarter Ending 12/31/98

II.B. Vice President's Remarks

Dr. Cantrell will inform the Board of Visitors of significant events occurring since the October meeting and other major issues as the Health Sciences Center enters 1999.

Focus will be given to the state of the Health Sciences Center, its accomplishments and challenges as it moves into the next century.

BOV Home | About the BOV | Past Meetings |
January 1999 Meeting | Between Session Meetings

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. CONSENT AGENDA

Conflict of Interest Exemption

II. REPORTS BY THE VICE PRESIDENT AND PROVOST FOR HEALTH SCIENCES (Dr. Cantrell)

Medical Center Financial Report (as of September 30, 1998)
(Dr. Cantrell to introduce Mr. Carter; William E.[Nick] Carter, Jr. to report)

Vice President's Remarks

III. EXECUTIVE SESSION

Discussion of proprietary, business related information of the Medical Center in connection with its proposed and existing joint ventures, and the investing of public funds where competition and bargaining is involved, when if made public initially the financial interests of the University would be adversely affected; and consultation with legal counsel and briefing by staff members pertaining to probable litigation and other specific legal matters requiring the provision of legal advice by counsel; as provided for in Sections 2.1-344 (A)(6), (7) and (24) of the Code of Virginia.

I. Conflict of Interest Exemption

BACKGROUND: The School of Medicine's Office of Continuing Medical Education (CME) is preparing a new internet-based CME program in cardiology called the "Cardiovascular Cybervillage". This interactive educational World Wide Web site will provide the latest and most accurate information available on cardiovascular medicine in a user friendly format. A major pharmaceutical company is interested in underwriting the entire cost of this program.

This web site's unique features facilitate customized learning. Its case-based format includes patient scenarios to communicate strategies for effective management of cardiovascular problems and requires choices about these teaching cases based on peer-reviewed practices and standards of care.

DISCUSSION: The Cardiovascular Cybervillage is based on a database software application developed by CardioConcepts, Inc., a local, privately owned company. This application will manage the retrieval and sequencing of images and medical content developed through the Office of Continuing Medical Education and the School of Medicine's Cardiovascular Division. To offer the Cardiovascular Cybervillage as a CME program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts for the licensing of the application and its continued development. Because CardioConcepts is owned by two University faculty members, Lawrence Gimpel, M.D. and Ralph Buckley, M.D., the agreement would constitute a violation of the Virginia Conflict of Interests Act's general prohibition on contracts between state agencies and their employees, unless it is approved pursuant to the exemption to the Act as enumerated in the Code of Virginia, Section 2.1-639.6(C)(7). This exemption requires approval by the Board of Visitors. If the exemption is approved, the terms of the agreement will be negotiated by the Universitys Director of Purchasing, in accord with applicable Public Procurement Act requirements.

ACTION REQUIRED: Approval by the Health Affairs Committee and by the Board of Visitors.

CONFLICT OF INTEREST EXEMPTION

The President will propose the adoption of the following resolution:

WHEREAS, the School of Medicine Office of Continuing Medical Education wishes to offer an internet-based program in cardiology titled the "Cardiovascular Cybervillage"; and

WHEREAS, to offer the Cardiovascular Cybervillage program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts, Inc., a company owned by two faculty members, Lawrence Gimpel, M.D., and Ralph Buckley, M.D., for the licensing and further development of the Cardiovascular Cybervillage software application; and

WHEREAS, entry into an agreement with CardioConcepts may be entered into under the exemption to the Virginia Conflict of Interests Act as provided in Section 2.1-639.6(C)(7) of the Code of Virginia, with approval by the Board of Visitors; and

RESOLVED that the exemption under Section 2.1-639.6(C)(7) of the Code of Virginia for the proposed agreement between the University and CardioConcepts, Inc., for licensing and development of the "Cardiovascular Cybervillage" application, is approved.

II.A. University of Virginia Medical Center Financial Report as of September 30, 1998

BACKGROUND: The Medical Center prepares a quarterly financial report and reviews it with the Executive Vice President and Chief Financial Officer before submitting the report to the Health Affairs Committee of the Board of Visitors. The Health Services Foundation (HSF) prepares and presents financial statements to the HSF Board and to the Vice President and Provost for Health Sciences.

The following financial report was sent to the Board of Visitors in a December 1998 interim mailing from the Executive Vice President and Chief Financial Officer.

DISCUSSION: At the end of the first quarter, gross inpatient revenue was 3.9 percent less than budget and gross outpatient revenue was 2.0 percent less than budget. The Medical Center has experienced a decrease in indigent care ($2.7 million less than budget year-to-date) that offsets an increase in bad debt ($1.1 million greater than budget year-to-date). In addition, the Medical Center is experiencing better than expected contractual adjustments resulting in a $3.6 million favorable comparison to budget. These activities, in combination with slightly better than budgeted miscellaneous revenue, result in total operating revenue being $1.8 million better than budget.

Expenses are higher than budget (as approved for the first 3 months) primarily because of the cost in the category of Medical Supplies and Pharmaceuticals, which represent $2.5 million of the variance from budget. Purchased Services & Other expenses represent another $1.6 million of the variance. Salaries & Fringe Benefits, Medical Center Contracts, and Depreciation & Amortization partially offset variance. As a result, total expenses, including bad debt, are $3.9 million over budget. This more than offsets net operating revenue position to arrive at an operating margin of 3.7% of net operating revenue and $2.2 million less than budgeted.

In general, the financial position at the end of the first quarter is less than optimal. Lower than budgeted gross inpatient and outpatient revenues have been experienced despite higher than budgeted volumes. Although this is offset by favorable indigent and contractual adjustments, the higher volumes cause there to be higher than budgeted expenses. The resulting operating margin positions the Medical Center poorly for the remainder of the year as it faces increased costs and decreased reimbursements amidst rising volumes.

The commitment to achieving a 6.0 percent operating margin holds firm, albeit unlikely given the first quarter financial results. In response to this situation, the Vice President and Provost for Health Sciences and the entire staff of the Medical Center continue to work toward ensuring aggressive medical management, cost containment, and process improvement with an emphasis on both quality patient care and lower cost.

REQUIRED ACTION: None.

University of Virginia Medical Center Income Statement Quarter Ending 9/30/98

Balance Sheet Quarter Ending 9/30/98

Financial Ratios Quarter Ending 9/30/98

Operating Statistics Quarter Ending 9/30/98

Income Statement Quarter Ending 12/31/98

Balance Sheet Quarter Ending 12/31/98

Financial Ratios Quarter Ending 12/31/98

Operating Statistics Quarter Ending 12/31/98

II.B. Vice President's Remarks

Dr. Cantrell will inform the Board of Visitors of significant events occurring since the October meeting and other major issues as the Health Sciences Center enters 1999.

Focus will be given to the state of the Health Sciences Center, its accomplishments and challenges as it moves into the next century.

BOV Home | About the BOV | Past Meetings |
January 1999 Meeting | Between Session Meetings

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. CONSENT AGENDA

Conflict of Interest Exemption

II. REPORTS BY THE VICE PRESIDENT AND PROVOST FOR HEALTH SCIENCES (Dr. Cantrell)

Medical Center Financial Report (as of September 30, 1998)
(Dr. Cantrell to introduce Mr. Carter; William E.[Nick] Carter, Jr. to report)

Vice President's Remarks

III. EXECUTIVE SESSION

Discussion of proprietary, business related information of the Medical Center in connection with its proposed and existing joint ventures, and the investing of public funds where competition and bargaining is involved, when if made public initially the financial interests of the University would be adversely affected; and consultation with legal counsel and briefing by staff members pertaining to probable litigation and other specific legal matters requiring the provision of legal advice by counsel; as provided for in Sections 2.1-344 (A)(6), (7) and (24) of the Code of Virginia.

I. Conflict of Interest Exemption

BACKGROUND: The School of Medicine's Office of Continuing Medical Education (CME) is preparing a new internet-based CME program in cardiology called the "Cardiovascular Cybervillage". This interactive educational World Wide Web site will provide the latest and most accurate information available on cardiovascular medicine in a user friendly format. A major pharmaceutical company is interested in underwriting the entire cost of this program.

This web site's unique features facilitate customized learning. Its case-based format includes patient scenarios to communicate strategies for effective management of cardiovascular problems and requires choices about these teaching cases based on peer-reviewed practices and standards of care.

DISCUSSION: The Cardiovascular Cybervillage is based on a database software application developed by CardioConcepts, Inc., a local, privately owned company. This application will manage the retrieval and sequencing of images and medical content developed through the Office of Continuing Medical Education and the School of Medicine's Cardiovascular Division. To offer the Cardiovascular Cybervillage as a CME program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts for the licensing of the application and its continued development. Because CardioConcepts is owned by two University faculty members, Lawrence Gimpel, M.D. and Ralph Buckley, M.D., the agreement would constitute a violation of the Virginia Conflict of Interests Act's general prohibition on contracts between state agencies and their employees, unless it is approved pursuant to the exemption to the Act as enumerated in the Code of Virginia, Section 2.1-639.6(C)(7). This exemption requires approval by the Board of Visitors. If the exemption is approved, the terms of the agreement will be negotiated by the Universitys Director of Purchasing, in accord with applicable Public Procurement Act requirements.

ACTION REQUIRED: Approval by the Health Affairs Committee and by the Board of Visitors.

CONFLICT OF INTEREST EXEMPTION

The President will propose the adoption of the following resolution:

WHEREAS, the School of Medicine Office of Continuing Medical Education wishes to offer an internet-based program in cardiology titled the "Cardiovascular Cybervillage"; and

WHEREAS, to offer the Cardiovascular Cybervillage program, the Office of Continuing Medical Education must enter into an agreement with CardioConcepts, Inc., a company owned by two faculty members, Lawrence Gimpel, M.D., and Ralph Buckley, M.D., for the licensing and further development of the Cardiovascular Cybervillage software application; and

WHEREAS, entry into an agreement with CardioConcepts may be entered into under the exemption to the Virginia Conflict of Interests Act as provided in Section 2.1-639.6(C)(7) of the Code of Virginia, with approval by the Board of Visitors; and

RESOLVED that the exemption under Section 2.1-639.6(C)(7) of the Code of Virginia for the proposed agreement between the University and CardioConcepts, Inc., for licensing and development of the "Cardiovascular Cybervillage" application, is approved.

II.A. University of Virginia Medical Center Financial Report as of September 30, 1998

BACKGROUND: The Medical Center prepares a quarterly financial report and reviews it with the Executive Vice President and Chief Financial Officer before submitting the report to the Health Affairs Committee of the Board of Visitors. The Health Services Foundation (HSF) prepares and presents financial statements to the HSF Board and to the Vice President and Provost for Health Sciences.

The following financial report was sent to the Board of Visitors in a December 1998 interim mailing from the Executive Vice President and Chief Financial Officer.

DISCUSSION: At the end of the first quarter, gross inpatient revenue was 3.9 percent less than budget and gross outpatient revenue was 2.0 percent less than budget. The Medical Center has experienced a decrease in indigent care ($2.7 million less than budget year-to-date) that offsets an increase in bad debt ($1.1 million greater than budget year-to-date). In addition, the Medical Center is experiencing better than expected contractual adjustments resulting in a $3.6 million favorable comparison to budget. These activities, in combination with slightly better than budgeted miscellaneous revenue, result in total operating revenue being $1.8 million better than budget.

Expenses are higher than budget (as approved for the first 3 months) primarily because of the cost in the category of Medical Supplies and Pharmaceuticals, which represent $2.5 million of the variance from budget. Purchased Services & Other expenses represent another $1.6 million of the variance. Salaries & Fringe Benefits, Medical Center Contracts, and Depreciation & Amortization partially offset variance. As a result, total expenses, including bad debt, are $3.9 million over budget. This more than offsets net operating revenue position to arrive at an operating margin of 3.7% of net operating revenue and $2.2 million less than budgeted.

In general, the financial position at the end of the first quarter is less than optimal. Lower than budgeted gross inpatient and outpatient revenues have been experienced despite higher than budgeted volumes. Although this is offset by favorable indigent and contractual adjustments, the higher volumes cause there to be higher than budgeted expenses. The resulting operating margin positions the Medical Center poorly for the remainder of the year as it faces increased costs and decreased reimbursements amidst rising volumes.

The commitment to achieving a 6.0 percent operating margin holds firm, albeit unlikely given the first quarter financial results. In response to this situation, the Vice President and Provost for Health Sciences and the entire staff of the Medical Center continue to work toward ensuring aggressive medical management, cost containment, and process improvement with an emphasis on both quality patient care and lower cost.

REQUIRED ACTION: None.

University of Virginia Medical Center Income Statement Quarter Ending 9/30/98

Balance Sheet Quarter Ending 9/30/98

Financial Ratios Quarter Ending 9/30/98

Operating Statistics Quarter Ending 9/30/98

Income Statement Quarter Ending 12/31/98

Balance Sheet Quarter Ending 12/31/98

Financial Ratios Quarter Ending 12/31/98

Operating Statistics Quarter Ending 12/31/98

II.B. Vice President's Remarks

Dr. Cantrell will inform the Board of Visitors of significant events occurring since the October meeting and other major issues as the Health Sciences Center enters 1999.

Focus will be given to the state of the Health Sciences Center, its accomplishments and challenges as it moves into the next century.

MORE MEETING INFORMATION PAST MEETINGS PUBLIC MINUTES

BOARD OF VISITORS OF THE UNIVERSITY OF VIRGINIA

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