UMC Board tells its financial analysts: "Redo The Figures"

While Mayor Landrieu and Governor Jindal continue to push to contort New Orleans into a medical city befitting Houston or Birmingham,  the funding for the building and operation of the new Academic Medical Center is still very much in question.

As we reported in our last post, Senator David Vitter, and a bombshell report from UMC's own  independent financial advisers, Kaufman, Hall & Associates, threw a wrench into the manufactured groundbreaking celebration on April 18th, less than two weeks ago.

Speaking of manufactured....

After the Kaufman Hall report that outlines the financial impossibilities of supporting a 424-bed hospital was released, DHH secretary Bruce Greenstein and others predictably began a damage control blitz consisting of protests that Kaufman Hall, a financial consulting from Illinois that specialize in healthcare, just do not understand the project..   Yet, these same advocates for the new Taj-Ma-Hospital - as we like to call it - had months to submit all of the relevant data and arguments that they wanted analyzed.

So what do you do when you don't like the figures handed back to you?  Send 'em back.  The UMC Board, An independent board appointed to oversee the construction and operation of the new hospital - (where ever it may materialize) - and chaired by Bobby Yarborough, have sent the report back for recalculating and have put their May 5th monthly board meeting off pending receipt of the  new figures.

Doubts about the size of this hospital have previously been validated by Verite, a nationally respected group of healthcare analysts that put out a study commissioned by the former Secretary of the Louisiana Department of Health and Hospitals in 2010.

Senator Vitter lambasted the board for canceling the meeting in a letter released yesterday, April 27th suggesting that the move raises “enormous suspicion” and puts into question the ability of financial advisers to deliver an independent unbiased report. In his letter, [see attached] he outlined key findings in the report including:

  • The plan is “materially larger than is supportable".

  • Estimates that the plan will require very large annual operating costs subsidies from the state budget--over $100 million per year.

  • Documents that the current number of hospital beds per capita in the region is already above the national average, and that the mega-Charity plan will make that disparity worse—three beds per thousand compared to 2.7 per thousand national average.

  • Concludes that the plan has unrealistically high estimates of patients who will choose the facility—both privately insured (Many will have negative perceptions of any Charity rebuild) and indigents (all have many more choices post-Katrina).

A new meeting has been rescheduled for June 2nd.  Our guess?   That will be pending a new report from Kaufman Hall tht is more to the likings of the supposedly “independent of the state and LSU” UMC board.