Downsizing Michelle Obama--and Why That's Worrisome

12.01.2009

To better cover the debate over health care policy, we've asked Harold Pollack to contribute items occasionally. Pollack is a public health policy researcher at the University of Chicago's School of Social Service Administration, where he is faculty chair of the Center for Health Administration Studies.

The University of Chicago Medical Center on Friday announced up to $100 million in budget cuts, from an annual budget of roughly $1.5 billion. These will be implemented by the start of fiscal year 2010. Fifteen senior executive positions will be eliminated, including the vice president for Community and External Affairs--Michelle Obama's job. (I cheat a bit here. Obama actually resigned her position January 9. I hear she is moving.)

Viewed from 50,000 feet, some health policymakers might see some good in this. America sinks too much of our health-care dollar into tertiary care. Some painful cuts are needed.

This is not a good thing.

First, this is a terrible time for a large employer to eliminate hundreds of jobs. On Chicago’s south side, many of these high-wage jobs are irreplaceable. They are certainly irreplaceable right now. And the hospital’s immediate problem--shared by many local peers--is a precipitous drop in patient demand that reflects increased unemployment and job insecurity, and declining health coverage. The resulting layoffs reflect another downward turn in the recession spiral. They underscore the desperate need for economic stimulus to reverse this process.

Second, such cuts probably accelerate the trend that moves academic medical centers out of their role as community hospitals. It's telling that Illinois's serious Medicaid unpaid bill problem has been identified as one reason for restructuring. Not only do public payers provide insufficient reimbursement--they don't always pay what they should when the bills come due. We don’t know where these cuts will come. Strategic realities being what they are, I doubt the cuts will come in profitable services to insured patients.

Third, these cuts will be executed to address the immediate strategic needs of our medical center. There is no real mechanism to take a broader view. This has attracted controversy. The Chicago Tribune reports that the hospital will forge ahead with its plan to open a $700 million hospital pavilion in 2012 with scores of private rooms, ICU beds, and new operating rooms.

"The top of our list is making sure that our patients have a terrific and compassionate experience here," Dr. James Madara, the medical center's chief executive, told the Tribune. "We plan on continuing with the new hospital pavilion. Our key strategic initiative here is to have a high technology platform."

Madara is a brilliant man in a tough job. I won’t second-guess his efforts to balance our books and to achieve badly-needed upgrades of the physical plant. (And, yes, we're part of the same university, though I tend a different vineyard within our UC world.)

In any event, these controversies exemplify problems well above Madara’s pay grade. In a sane health-policy environment, places like UCMC could make equally visionary investments in primary and preventive care. By any reasonable metric of population health, many ostensibly low-tech services—basic maternal and child services to low-income families, infectious disease prevention and treatment, psychiatric and behavioral health services--are more important than a new ICU or advanced cancer center. Right now, with 45+ million uninsured and Medicaid in stress, it’s unclear that elite teaching hospitals can continue to be terrific and compassionate sources of care on these fronts for their surrounding communities.

UCMC, working with community partners, is addressing this reality by creating new collaborative models. Much of this work was initiated by Michelle Obama, and carried on by her successor, Eric Whitaker. It’s a big challenge, and a delicate one. The university needs to share authority, credit, and resources. Community providers must also change, and operate they operate with more limited resources. Too bad the campaign reporters focused on Mrs. Obama’s wardrobe more extensively than the challenges and accomplishments of her day job.

If prestigious medical centers evolve narrowly and exclusively into high-technology platforms for tertiary care, much that makes them precious will be lost. In so many ways, it is getting harder for academic medical centers to treat disadvantaged patients with the thoroughness and the decency every patient deserves.

For good reasons, Michelle Obama won’t play the lead health reform role that Hillary Clinton did. Yet she has seen the organizational dilemmas from the vantage point of an insider. Now that she’s changing jobs, I hope she educates citizens and policymakers—maybe one across the breakfast table--about what is being lost.

--Harold Pollack

Posted: Monday, January 12, 2009 1:44 PM with 5 comment(s)

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satyendra said:

If U. of Chicago Hospitals is facing economic challenges, they could do well to straighten out their billing dept. A while ago I had insurance-approved surgery there. I gave them my updated insurance info. For some reason, it registered for the hospitals but not the doctors. So the doctors billed the previous insurance and then ended up sending it to collections. Although I tried to inform the collections agent of my actual insurance, she was quite rude and just put it on my credit report and hung up (the 7 years have long elapsed so it's now gone). I then tried to call the hospital but even after explaining my situation no one got back to me. My guess is by then they had sold my "debt" for a fraction instead of collecting on consignment, so they would no longer have been incented to work it out with me.

From what I understand of these arrangements it would have been the doctors, and not the hospitals who lost out in my particular case. However, their whole billing operation was obviously screwed up to where they'd probably increase their revenue just by collecting on a greater percent of their receivables and reducing their so-called bad debt. True, I don't know if those figures would be enough to finance community preventive and maternal care or bring back the recently downsized.

January 12, 2009 2:19 PM

I got care there as a student and until above-mentioned surgery. It was well-known by me and my classmates that U. of C. Hospitals was a good place to go if you had some rare disease that would feather some alpha-doc's cap. But none of us was particularly satisfied with the sort of care we received for minor illnesses, aches and pains and ultimately found better environments (Northwestern, anyone?)

January 12, 2009 2:23 PM

rysdale said:

Vice President for Community and External Affairs?

Can you say, Make Work Job?

Sounds like Ensign Pulver, Laundry and Morale Officer.

Now, she may have made a real difference in the job, it happens. But the position is the first one I'd expect to cut when money gets tight in a hospital. I mean, be serious, OK?

Not to mention that they're actually cutting high level management jobs. It would be nice if more companies would do this. Rather than laying off low level and/or entry level workers. People like Michele Obama will never miss any meals. The graveyard janitor, though....

(I'll leave out the casual admission that the government isn't reimbursing properly for medical care. So what will happen when we're all on government health care? We'll make sure that the inadequate money supplied by the government is saved for high paying jobs like VP for Community and External Affairs? Or, they'll be enough money for everything, all the time? Because we all know that gov't bureaucracies aren't top heavy with expendable, highly paid people....)

January 13, 2009 5:41 AM

hmseil01 said:

We don't need golden bedpan hospital rooms. As Dr. Pollack points out, we need more community clinics and preventive care, more primary care personnel, and decent clean hospitals. As for Rysdale's negative comments about publicly-funded health programs, I suggest he/she visit a French, or Canadian hospital. Oddly enigh, all their hospitals and physicians get paid. I am sure those free market countries continue to fund public health community liaisons.. In thse tough times, belts will be tightened everywhere, but "single payer" countries will continue to care for their people. Government-run health care works when properly administered (see our VA). It does not work when shabbily administered ( FEMA), or when the emphasis is on profit instead of quality care (HMOs, Medicare Advantage). The minute we allowed insurers, even so-called non-profit HMOs, into our Medicaid and Medicare programs, funding and energy were diverted to feed the profit monster.

And for Satyendra-- the movie SiCKO has an amusing scene in which Michael Moore tries to "pay" for services at a British Hospital. Patients and employees chuckle because everyone is, of course, covered by the National Health System. Our paperwork and billing games are designed to confuse, humiliate and terrify persons who are already dealing with an illness. It is time for physicians who remember the Hippocratic oath and public health officials to step forward and tell our new President "Enough!"

January 13, 2009 9:51 AM

emccded said:

Pollak's position seems to be that every dollar expended on health care is good. How the elimination of 15 senior executive positions is a blow to the Southside is a ridiculous view, even from the ivory tower.

And oh, yes, let's complain about the reimbursement rates. Nothing - in this view - outranks health care in financial priority.

I don't think this piece makes the case that belt-tightening jeopardizes health-care reform. I think in this case the 50,000-foot view is the one in focus.

January 13, 2009 10:53 AM