Endowment growth stalling compared to other institutions.
Numerous earlier reports by Mr. Chris Otts of WDRB brought to the attention of the public information about financial dealings of enough concern that at least two major donors to the University of Louisville withdraw their support, triggering in large measure an intervention by the University of Board of Trustees to take a more controlling role in the University of Louisville Foundation and a full-scale fiduciary audit. This latter offers the potential to clear the air or to lead to even more troublesome revelations. Mr. Otts’s latest report deals with unauthorized spending of the University’s endowment by the Foundation in support of its commercial research, real estate, and other agendas both known and unknown. The result has been a substantial fall in the value of the endowment as its principal is consumed.
Sparked by Mr. Otts’s use of information provided to him by the University as reported to the American Association of College and University Business Officers (NACUBO); and by comments made by Trustees Greenberg and Benz at last week’s meeting of UofL Trustees raising serious concerns about the endowment; I went to NACUBO’s website myself. Summary files for public use are available including the market values of the endowments of some 850 of the most important Colleges and Universities in the US and Canada from 1990 to 2015. I abstracted these and plotted the market value of UofL’s endowment along with its rank among other institutions in this regard. Spending information or investment yields for individual institutions are not made available to the public, although summary statistics on aggregates in broad categories are available. A static image is presented below, and an interactive version revealing the underlying data is available.
In summary, the amount of our endowment rose progressively from 1990 until around 2007 after which much volatility occurred to the point that the market value of the endowment in 2016 is indeed less than it was 10 years ago in 2006! UofL appears to be eating its nest egg, and compared to other institutions of higher education, is losing ground in endowment growth.
Continue reading “Drop In Value of UofL Endowment Confirmed.”
Financial stresses abound.
In the space of a week, Moody’s Investor Services released credit opinions for the University of Louisville and the University of Louisville Foundation; and Catholic Health Initiatives published its Annual Report for the Fiscal year ending June 30, 2016. The results were not very pretty. The rating for the bulk of the University’s existing bonds dropped one grade to A1 with an outlook determined to be stable. The Foundation did not fare as well. Its rating dropped three steps to A3 with an outlook revised to negative. Catholic Health Initiatives disclosed operating and non-operating losses totaling $667 million. CHI had declines in its own bond ratings earlier this year, due largely to excessive debt reported to stand at $9 Billion as it seeks to partner or merge with another Catholic hospital chain. The drops in grade and financial losses are by themselves troubling. However, language in the details of the reports links the organizations together, highlights the harmful consequences of recent management and political manipulations on the University, overestimates the health of current business relationships between the parties, and underestimates the impact of promised roll-backs to Medicaid and the Affordable Care Act on the financial health of our local hospitals and the University. For these reasons, I fear that things are going to get worse before they get better. Continue reading “Credit Ratings for UofL, UofL Foundation, and CHI Downgraded.”
A public hearing to present the results and hear comments about the draft Environmental Impact Statement for the proposed Replacement VA Medical Center in Louisville was held on November 15 at Christ Church United Methodist on Brownsboro Road. This is just down the road from the favored site on a vacant former farm on the southeast corner of the intersections of the I-264/Waterson Expressway and Route 42/22/Brownsboro Road. Two separate sessions were held: at noon and 6 pm. I attended the earlier session which lasted just shy of three hours. I did not count heads, but I estimate that something fewer than 100 people were in attendance including VA staff, consultants, and reporters. I learned about the hearing earlier from the newspaper. When I got home that afternoon, I found my personal notice in the mail delivered after the fact by the VA to all those who signed up as interested persons. I do not know if more people would have attended had more timely notice been given in this manner. The people who did show up were clearly already engaged, seemed to be largely neighbors of the project, and almost uniformly against locating the project at Brownsboro for multiple reasons. I do not know how the evening session went and will limit my comments to the midday session. Continue reading “What Is Happening at Louisville’s Veterans Hospital?”
A number of threads that I have been following this past year or so came to a head this last month. These include a guilty verdict in federal court for a cardiologist in Ashland, Kentucky who had been accused of falsifying billing records to secure payment for performing medically unnecessary invasive procedures. The Leapfrog organization published its updated list of hospital safety grades. Additionally, and certainly not least, there are worsening signs of a dysfunctional and perhaps disintegrating relationship between the University of Louisville and KentuckyOne Health, the unit of Catholic Health Initiatives (CHI) that in Louisville owns Jewish and Sts. Mary and Elizabeth Hospitals, and manages the University of Louisville Hospital and its James Graham Brown Cancer Center. Although these themes are not necessarily unrelated to each other, in this article I will comment on the UofL/KentuckyOne situation and deal with others subsequently. First some background for what promises to be a major change in the alignments of the downtown medical center. Continue reading “What Is Happening To Our Downtown Louisville Medical Center?”
The anticipated announcement that Norton Healthcare would change the name of its Children’s Hospital following the settlement of its legal dispute with Kosair Charities was made today. On November 10 the, former Kosair Children’s Hospital will be named Norton Children’s Hospital. The new name follows the format used by Norton’s other local hospitals. The Kosair appellation will also be dropped from other healthcare facilities that shared names including outpatient centers, a women’s and children’s hospital, and a network of pediatric medical general and specialty practices.
According to today’s press release:
“In 1981, the Kosair Charities Committee and Norton-Children’s Hospital entered into an agreement whereby the Kosair name would be used on the hospital. Following a mutual decision in late June 2016 to end the naming rights agreement, Norton Healthcare and Kosair Charities agreed that the name Kosair would be removed from all Norton-owned facilities and medical practices.” and…
“We thank Kosair Charities and its members for their support and dedication to the Commonwealth’s children,” [Hospital President] Kmetz said. “Both organizations remain committed to meeting children’s health care needs. We will now pursue that focus independently.”
And so, what began as an amicable partnership that became a major focus of Kosair Charities’ fundraising efforts, ends deceptively gently after an acrimonious legal dispute initiated by Kosair Charities. For a relatively small contribution towards charitable care in the Children’s Hospital, Kosair Charities had a top billing in the name of the largest and most respected children’s healthcare network in the state. Continue reading “There Is A New Hospital in Louisville!”
Later this morning, the Board of Directors of the University of Louisville Foundation will meet to discuss matters crucial to its future relationship to the University of Louisville. Following the forced resignation of former UofL Pres. James Ramsey, a Foundation board comprised largely of friends and appointees of Ramsey seems more interested in protecting his legacy and image than in facing up to the wholesale loss of confidence in the Foundation by the community. Having been forced to partially lift the curtain on its internal activities, and in the face of refusal to fully disclose its confusing if not inappropriate financial machinations to University of Louisville trustees, the Foundation still clings to the incomprehensible belief that it has the right to select and oversee the outside entity that will audit its financial activities. If allowed to do so, the Foundation would thus define both the scope of such an examination and control the dissemination of its result. After all, he who pays the piper calls the tune. All this from a Board of Directors that appeared prepared to retain Ramsey as President of the Foundation and award him even more money from the University’s assets. Of course, it is possible that more than just protecting Ramsey’s reputation is at stake. As yet undocumented allegations of financial mismanagement or worse are circulating. Certainly it is in the interest of the entire University community that no doubts remain after a long-overdue, no-holds-barred audit of the vaults of the Foundation. It is follow the money time! Continue reading “Ramsey Supporters on UofL Foundation Resisting Oversight by University Trustees.”
I have been advised by two sources that KentuckyOne Health will soon announce the elimination of several system-wide or senior executive positions designed to improve efficiency, reduce costs, and emphasize local leadership. The as-yet unconfirmed names of the individuals currently in those positions include clinical and operational executives at the highest level. I am unaware if the names of included leadership comprise a complete list or represent the tip of the iceberg of things to come. Perhaps as an early indicator, the senior physician executive at Jewish and Sts. Mary & Elisabeth Hospitals left that position a few weeks ago. As a company outsider, it is impossible to know all the reasons for changes in personnel. These often include the personal career plans of the employee, but also concerns about the fit between employer and employee in meeting the goals of the particular corporation. KentuckyOne may well once again be feeling financial pressures that cannot be denied. It has laid-off employees in the past to decrease expenses – a strategy that in the longer run was not entirely successful at University Hospital.
On the other hand.
One of the most common complaints I hear from my University of Louisville colleagues reflects what is considered to be unwanted and disruptive outsourcing or other “outsider intrusion” on the part of Catholic Health Initiatives or KentuckyOne management that does not allow for appropriate local initiative or control, or which treats all hospitals the same no matter where they are located, or fails to acknowledge the particular needs of their patient population. From this perspective, a diminution of the role of system-wide executives might be considered a worthwhile result. On the other hand, I suppose it is possible that a state-level KentuckyOne system control might be replaced by even more direct CHI control from Colorado! The desire for local control is, however, at odds with current national and local policy, or financial pressures for hospital and health system consolidation and coordination. The health of KentuckyOne and its partnership with the University of Louisville is a matter of critical concern for Jefferson County and the Commonwealth. Things have not been going well so far. Continue reading “KentuckyOne Poised To Announce Layoffs of Senior Executives.”
University of Louisville Foundation goes rogue.
An unexpected special meeting of the 5-member Executive Committee of the University of Louisville Foundation that was to be held at 5 PM today (Labor Day) was canceled at the last minute. I and several members of the traditional print and broadcast media arrived to cover the open session only to find we were the only ones there! It was anticipated that the meeting would initiate the hiring of an external firm to perform the forensic audit demanded by the James Graham Brown Foundation, and execute the separation of Foundation President James Ramsey and Kathleen Smith from the Foundation. It was reported by Andrew Wolfson on the Courier-Journal’s website that the cancellation was consequent to a letter by University of Louisville Board of Trustee Chairman Larry Benz. However, it was later reported by Chris Otts of WDRB, that today Acting University Chairman Neville Pinto had also sent an email to Foundation Chair Robert Hughes and other Board members expressing polite but strongly worded objections to the Foundation’s plans. Unbelievably, neither President Pinto nor Chairman Benz, both of whom are on the Foundation Board, had been consulted about the meeting nor informed about what was to be discussed or enacted. Copies of the emails from Chairman Benz and President Pinto to Chairman Hughes are attached. Continue reading “Special Meeting of UofL Foundation Canceled at Last Minute.”
Last February, I submitted an open records request to the University of Louisville for documents and information used by then-President James Ramsey underlying his decision to withdraw from postseason basketball play in 2016. [I was reacting to media reports and a formal statement by UofL that University President Ramsey had received updates and information upon which he acted. I asked for that information.] My request was summarily dismissed and I filed an appeal with the Attorney General of Kentucky. After much back and forth between that office and the University, it was determined that the University had indeed violated the requirements of Kentucky’s Open Records Act. Even before I was able to read the opinion, it was being published by traditional media including the Courier-Journal, and WDRB. Here is the best summary to date. Here is another. A shorter version from the Associated Press appeared in dozens of newspapers nationally before the end of day yesterday. Because of the presumed general public interest in this matter, I believe it is appropriate to explain my motivation and make to make public the correspondence and documents that led up to the AG’s decision.
The decision may have been correct.
Let me say at the outset, I have no opinion about whether the decision to withdraw was appropriate or not. It may well have been the best path forward. I did not have any interest in learning the names of any of the students involved nor would I have made their names public. [Similarly I am not interested in any salacious details.] I do however have an interest in how the University does its business. I have written often over the last few years about the lack of appropriate transparency and accountability within the administration of Dr. Ramsey. I have argued that many of the University’s problems, and certainly those of its its public relations image stem from its penchant for non-disclosure or secrecy. Discussions with traditional journalists and my own experience led me to believe that the University is often a reluctant participant in the Open Meeting or Open Records requirements. Continue reading “Attorney General Finds University of Louisville Violated Open Records Law In NCAA Basketball Scandal.”
Bad heroin is an oxymoron, but over the past week, several dozen opioid overdoses appeared in local emergency rooms or were rescued by emergency medical technicians. At least one died. It is being reported that some 300 overdose cases were reported in our region. Since these patients responded to the opioid-specific rescue drug, naloxone, it is assumed they overdosed on one opioid or another. Toxicology studies are pending, and public health authorities are not overstating what they know, but we can reasonably assume the substances injected or otherwise consumed contained an unexpectedly high amount of heroin; the powerful synthetic opioid fentanyl; or carfentanil, the new-to-the-scene, elephant-strength, fentanyl look-alike. For decades, heroin available to end-users has been cut, or diluted with a variety of non-opioid substances – some more benign than others. In recent years, the availability of higher quality heroin from Mexico has both driven down the price and increased the potency of street heroin. Presumably both sellers and users have been adjusting their practices to account for the greater potency. Uncertainty about the purity or safety of available heroine products is said to be the reason that addicts in southern Indiana chose the prescription drug Opana as their opioid of choice. This of course did not protect them from an accompanying epidemic of HIV infection and viral hepatitis.
For reasons not fully known to me, for the past year or more, heroin preparations used by addicted individuals have been shown to contain fentanyl. It is apparent that these augmented preparations can catch whole communities of users by surprise. The arrival of heroin with augmented lethality is signaled by an increase in overdoses and deaths within a confined geographic area. While I was there in the summer of 2015, such an outbreak of heroin-associated deaths occurred in Washington County, Pennsylvania.
Whether the offending additive was fentanyl or its cousin carfentanil is relevant not just to law enforcement, but for the rescue community. Unexpectedly high doses of naloxone are required to wake up individuals who have ingested these super-opioids. The appearance of such overdose outbreaks caused by more highly purified heroin or other opioids announces to a community that their problem with drug addiction is worse than they thought. I take that to be the message for us in Louisville. Continue reading “A Batch of Bad Heroin Arrives in Louisville.”