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UNIVERSITY OF VIRGINIA BOARD OF VISITORS Meeting of the Health System Board for the University of Virginia Health System June 6, 2018
UNIVERSITY OF VIRGINIABOARD OF VISITORS
Meeting of the Health System Board for the University of Virginia
Health System
June 6, 2018
UNIVERSITY OF VIRGINIAHEALTH SYSTEM BOARD
Wednesday, June 6, 201811:30 a.m. – 4:45 p.m.
Board Room, The Rotunda
Committee Members:L.D. Britt, M.D., Chair James B. Murray Jr. Babur B. Lateef, M.D., Vice Chair James V. ReyesFrank M. Conner III A. Bobby Chhabra, M.D., FacultyTammy S. Murphy Consulting Member
Public Members:Hunter E. CraigWilliam G. Crutchfield Jr.
Eugene V. FifeVictoria D. Harker
Ex Officio Members:Teresa A. Sullivan Richard P. Shannon, M.D.Dorrie K. Fontaine Pamela M. Sutton-WallacePatrick D. Hogan Scott A. Syverud, M.D.Thomas C. Katsouleas David S. Wilkes, M.D.
AGENDA
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I. HEALTH SYSTEM CORPORATE REPORTSA. Opening Remarks from the Chair (Dr. Britt) 1
Commending Resolution and Other RecognitionB. Remarks from the President (Ms. Sullivan) 2 C. Reports from the Executive Vice President for Health Affairs (Dr. Shannon) 3
1. Opening Remarks2. Be Safe Moment3. Health System Strategic Dashboard
D. Health System Finance Report from the Finance Working Group and Discussion (Mr. Murray and Mr. Douglas E. Lischke) 1. Health System Consolidated Financials Fiscal Year 2018 Year-to-Date 4
Report2. ACTION ITEM: Fiscal Year 2019 Operating and Capital Budgets for the 11
University of Virginia Health System E. Health System Development Report (Written Report) 20
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II. MEDICAL CENTER REPORTS (Ms. Sutton-Wallace)A. ACTION ITEMS: Signatory Authority Related to Medical Center Contracts 23
Exceeding $5 Million Per Year1. Virginia Blood Services One Year Contract Extension 2. Medtronic3. CDW Contract 4. Hill Rom Contract
B. Medical Center Chief Executive Officer Remarks 24 Schematic Design: Ivy Mountain Musculoskeletal Center
C. Medical Center Chief Executive Officer Report (Written Report) 27
III. SCHOOL OF MEDICINE REPORT (Written Report) 31
IV. COMMUNITY HOSPITALS AND POST-ACUTE SERVICES (Ms. Hereford)A. Transitional Care Hospital Operations Report (Written Report) 36B. ACTION ITEM: Renaming of UVA HealthSouth Rehabilitation Hospital 39
V. CLOSED SESSION Discussion of proprietary, business-related information pertaining to the
operations of the Medical Center, the School of Medicine, and the Transitional Care Hospital, where disclosure at this time would adversely affect the competitive position of the Medical Center, The School of Medicine or the Transitional Care Hospital, specifically:
– Strategic personnel, financial, investment, facility needs, market considerations, growth initiatives, and other resource considerations and efforts in light of market and regulatory changes for the Health System Clinical Enterprise and expected impact for Fiscal Year 2019; proprietary updates on joint ventures, affiliations, and partnership strategies, including, but not limited to, Blue Ridge PACE; innovative efforts and improvement initiatives for patient care and operations, including use of Health System innovation funds to further same; all of which further the strategic initiatives of the Medical Center, the School of Medicine, and the Transitional Care Hospital and include employee performance and other proprietary metrics;
– Confidential information and data related to the adequacy and quality of professional services, competency, and qualifications for professional staff privileges, and patient safety in clinical care, for the purpose of improving patient care for the Medical Center and the Transitional Care Hospital;
– Consultation with legal counsel regarding compliance with relevant federal and state legal requirements, legislative, and accreditation standards; all of which will involve proprietary business information and evaluation of the performance of specific personnel.
The relevant exemptions to the Virginia Freedom of Information Act authorizing the discussion and consultation described above are provided for in Section 2.2-3711(A)(1), (6), (8) and (22) of the Code of Virginia. The meeting of the Health System Board is further privileged under Section 8.01-581.17 of the Code of Virginia.
UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.A. Opening Remarks from the Chair
ACTION REQUIRED: None
BACKGROUND: The Committee Chair, Dr. Britt, will welcome guests and provide opening remarks, including recognition of certain individuals.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.B. Remarks from the President
ACTION REQUIRED: None
BACKGROUND: University of Virginia President, Teresa A. Sullivan, will offer remarks.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.C. Reports from the Executive Vice President for Health Affairs
ACTION REQUIRED: None
BACKGROUND: Richard P. Shannon, M.D., is the Executive Vice President for Health Affairs for the University of Virginia. Before joining the University in November 2013, he served as the Frank Wister Thomas Professor of Medicine at the University of Pennsylvania Perelman School of Medicine, and as chair of the Department of Medicine of the University of Pennsylvania Health System. An internist and cardiologist, Dr. Shannon is widely recognized for his work on patient safety. DISCUSSION: The Executive Vice President will inform the Health System Board (HSB) of recent events that do not require formal action, including a “Be Safe” moment and the Health System consolidated goals.
UNIVERSITY OF VIRGINIA
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BOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.D.1. Health System Consolidated Financials Fiscal Year 2018 Year-to-Date Report
ACTION REQUIRED: None
BACKGROUND: The Health System prepares a periodic financial report and reviews it with the Executive Vice President for Health Affairs before submitting the report to the HSB.
Douglas E. Lischke, C.P.A., M.B.A., C.I.T.P., C.H.F.P., serves as the Health System’s Chief Accounting Officer and Controller. Prior to coming to the UVA Health System, he was the Associate Vice President for Financial Services and Controller for Wake Forest Baptist Medical Center. Mr. Lischke is an active Certified Public Accountant, a Certified Healthcare Finance Professional, and a Certified Information Technology Professional with over 23 years of financial management experience.
DISCUSSION: FINANCE REPORT
School of Medicine – Academic, Clinical, Health System Library
Operating Income after transfers Year-to-Date 3/31/2018 (in millions) (“M”)
Actual BudgetFav /
(Unfav)UPG - Clinical (16.4) (12.8) (3.6)SOM - Academic 7.3 .7 6.6Library 1.2 (.4) 1.6
Consolidated SOM (7.9) (12.5) 4.6
Through the third quarter of Fiscal Year 2018, the Consolidated School of Medicine generated an operating loss of $7.9M after transfers from the Medical Center, compared to a budgeted loss of $12.5M.
The physician clinical enterprise (UPG) produced an operating loss of $16.4M, which was $3.6M unfavorable to budget. The unfavorable budget variance was driven by an aggressive patient service revenue budget coupled with unfilled clinical positions, a
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slowdown in clinical throughput post-Epic, and higher bad debt through nine months. The UPG results include $26.0M investment in the academic mission.
The academic enterprise generated operating income of $7.3M, a $6.6M favorable variance to budget. This favorable variance was due to additional gifts, endowment distribution, and favorable salary coverage on grants, relative to budget.
Medical Center
After nine months of operations in Fiscal Year 2018, the operating income for all business units was $30.2M, resulting in a 2.4% operating margin. Operating income was unfavorable to budget by ($8.0M). Performance was driven primarily by inpatient discharges and transplants which were favorable to budget. Surgical cases, outpatient clinic visits, and outpatient surgery cases were unfavorable. The operating margin for the consolidated Medical Center is supported by imaging, dialysis, the Transitional Care Hospital (TCH), and the management of shared services expenses. For Fiscal Year 2018, the Medical Center generated $119.4M in cash from operations (EBITDA) and cash reserves totaled 148 days. Total expenses adjusted for volume and case mix index were below the budget.
Total paid employees for all business units, including contracted employees, were two below budget. Contract labor is composed primarily of nurse travelers and individuals employed by the School of Medicine and contracted to the Medical Center. The Medical Center utilized 182 nurse travelers.
FY 2018 2018 Budget
Employee FTEs 8,186 8,297
Contract Labor FTEs 398 289
Salary, Wage andBenefit Cost / FTE
$86,055 $89,362
Total FTEs 8,584 8,586
Transitional Care Hospital
For the first nine months of operations in Fiscal Year 2018, the operating income for the TCH was a loss of ($0.3M), resulting in an operating margin of (1.7%), compared to budget of operating income of 1.7%. The unfavorable variance is attributable to volumes and case mix index being below budget.
During the third quarter of Fiscal Year 2018, TCH reported 269 discharges. One hundred and ninety-seven of those discharges were from the Medical Center and represent 4,397 patient days or approximately 20.5 beds of capacity per day for the Medical Center. The 197 discharges to TCH also contributed to a 0.26 day reduction in the Medical Center’s
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average length of stay. These metrics further demonstrate the importance and value of long term acute care services in the continuum of care.
Overall, the Health System operating loss was slightly unfavorable to budget for the
nine months ended March 31, 2018.
University of Virginia Medical CenterIncome Statement(Dollars in Millions)
Excluding Culpeper Regional Hospital
Most Recent Three Fiscal Years Budget/Target
Description Mar-16 Mar-17 Mar-18 Mar-18
Net patient revenue $1,077.8 $1,159.6 $1,202.0 $1,211.9
Other revenue 35.7 41.4 37.4 40.7
Total operating revenue $1,113.4 $1,201.0 $1,239.4 $1,252.6 Operating expenses 977.9 1,044.4 1,120.0 1,125.5
Depreciation 71.6 71.4 74.0 73.1
Interest expense 15.2 13.0 15.2 15.7
Total operating expenses $1,064.7 $1,128.8 $1,209.2 $1,214.4
Operating income (loss) $48.7 $72.2 $30.2 $38.2
Non-operating income (loss) $15.7 $23.4 ($2.5) ($41.6)
Net income (loss) $64.4 $95.6 $27.7 ($3.3) Principal payment $11.1 $12.8 $15.4 $15.4
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University of Virginia Medical CenterBalance Sheet
(Dollars in Millions)Excluding Culpeper Regional Hospital
Most Recent Three Fiscal Years
Description Mar-16 Mar-17 Mar-18 Assets Operating cash and investments $218.4 $68.4 $17.4 Patient accounts receivables 172.9 184.9 215.5 Property, plant and equipment 874.1 987.7 1,126.1 Depreciation reserve and other investments 248.1 613.0 551.3 * Endowment Funds 544.0 582.9 631.6
Other assets 230.1 251.5 248.5
Total Assets $2,287.7 $2,688.5 $2,790.4 Liabilities Current portion long-term debt $6.5 $8.4 $10.5 Accounts payable & other liab 131.1 113.6 112.1 Long-term debt 445.8 767.4 792.9
Accrued leave and other LT liab 282.3 271.2 294.4
Total Liabilities $865.8 $1,160.6 $1,209.8
Fund Balance $1,421.9 $1,527.9 $1,580.6
Total Liabilities & Fund Balance $2,287.7 $2,688.5 $2,790.4
*$551.3M includes ED/Bed Tower bond issue funds of $204.7
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University of Virginia Medical CenterFinancial Ratios
Excluding Culpeper Regional Hospital
Most Recent Three Fiscal Years Budget/Target
Description Mar-16 Mar-17 Mar-18 Mar-18 Operating margin (%) 4.4% 6.0% 2.4% 3.1% Current ratio (x) 2.8 2.1 1.9 2.4 Days cash on hand (days) 171.8 153.3 148.2 190.0 Gross accounts receivable (days) 49.7 46.8 50.2 45.0 Annual debt service coverage (x) 5.7 7.0 3.8 5.2 Debt-to-capitalization (%) 33.7% 44.8% 45.5% 31.8% Capital expense (%) 8.2% 7.5% 7.4% 7.3%
University of Virginia Medical CenterOperating Statistics
Excluding Culpeper Regional Hospital
Most Recent Three Fiscal Years Budget/Target
Description Mar-16 Mar-17 Mar-18 Mar-18
Acute Discharges 21,074 21,690 21,966 21,787 Patient days 135,316 135,810 142,293 137,626 Observation Patients - MC only 3,347 3,288 2,945 3,101 Post Procedure Patient - MC only 3,456 3,887 3,466 3,781 All Payor CMI Adj Avg Length of Stay - MC only 2.89 2.88 3.01 2.86 Clinic visits 641,313 667,236 630,930 657,983 ER visits - MC only 47,232 47,103 48,675 47,914 All Payor CMI 2.09 2.12 2.09 2.10 Average beds available FTE's (including contract labor) 7,934 8,122 8,584 8,586
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Actual Budget % Variance Prior Year Actual Budget % Variance Prior YearDISCHARGES: ACUTE INPATIENTS:Adult 18,864 18,672 1.0% 18,525 Inpatient Days 142,293 137,626 3.4% 135,810 Pediatrics 2,099 1,990 5.5% 2,017 All Payor CMI Adjusted ALOS - MC 3.01 2.86 5.4% 2.88 Psychiatric 734 815 (9.9%) 839 Average Daily Census 519 502 3.4% 496 Transitional Care 269 310 (13.2%) 309 Births 1,358 1,428 (4.9%) 1,350
Subtotal Acute 21,966 21,787 0.8% 21,690
Observation 2,945 3,101 (5.0%) 3,288 OUTPATIENTS:Clinic Visits 630,930 657,983 (4.1%) 667,236
Total Discharges 24,911 24,888 0.1% 24,978 Average Daily Visits 3,596 3,735 (3.7%) 3,760 Emergency Room Visits - MC 48,675 47,914 1.6% 47,103
Adjusted Discharges 46,425 46,474 (0.1%) 46,623
Post Procedure 3,466 3,781 -8.3% 3,887 . SURGICAL CASES
CASE MIX INDEX: UVA Main Hospital Operating Room (IP and OP) 12,945 13,024 (0.6%) 13,180 UVA Outpatient Surgery Center 8,871 9,505 (6.7%) 9,408
All Payor CMI - UVA Hosp & Clinics 2.09 2.10 (0.7%) 2.12 Total 21,816 22,529 (3.2%) 22,588 Medicare CMI - UVA Hosp & Clinics 2.23 2.23 (0.1%) 2.25
($s in thousands) Actual Budget % Variance Prior Year ($s in thousands) Actual Budget % Variance Prior YearNET REVENUES: NET REVENUE BY PAYOR: Net Patient Service Revenue 1,201,978 1,211,908 (0.8%) 1,159,565 Medicare 342,675$ 341,747$ 0.3% 337,133$ Other Operating Revenue 37,432 40,705 (8.0%) 41,437 Medicaid 232,931 239,802 (2.9%) 231,448 Total 1,239,409$ 1,252,613$ (1.1%) 1,201,002$ Commercial Insurance 187,287 188,319 (0.5%) 189,534
Anthem 249,810 247,332 1.0% 221,069 Aetna 82,141 85,668 (4.1%) 83,720
EXPENSES: Other 107,134 109,041 (1.7%) 96,661 Salaries, Wages & Contract Labor 564,139$ 576,739$ 2.2% 521,580$ Total Paying Patient Revenue 1,201,978$ 1,211,909$ (0.8%) 1,159,565$ Supplies 299,267 287,968 (3.9%) 278,808 Contracts & Purchased Services 256,566 260,813 1.6% 243,985 OTHER: Depreciation 73,977 73,110 (1.2%) 71,359 Collection % of Gross Billings 29.36% 29.31% 0.2% 29.68% Interest Expense 15,214 15,742 3.4% 13,038 Days of Revenue in Receivables (Gross) 50.2 45.0 (11.6%) 46.8 Total 1,209,162$ 1,214,373$ 0.4% 1,128,770$ Cost per CMI Adjusted Discharge 12,560$ 12,520$ (0.3%) 11,487$ Operating Income 30,247$ 38,240$ (20.9%) 72,232$ Total F.T.E.'s (including Contract Labor) 8,584 8,586 0.0% 8,122 Operating Margin % 2.4% 3.1% 6.1% F.T.E.'s Per CMI Adjusted Discharge 24.43 24.25 (0.7%) 22.65
University of Virginia Medical CenterSUMMARY OF OPERATING STATISTICS AND FINANCIAL PERFORMANCE MEASURES
Fiscal Year to Date March 31, 2018 with Comparative Figures for Prior Fiscal Year to Date March 31, 2017Excludes Culpeper Regional Hospital
OPERATING STATISTICAL MEASURESDISCHARGES and CASE MIX - Year to Date OTHER INSTITUTIONAL MEASURES - Year to Date
OPERATING FINANCIAL MEASURES
REVENUES and EXPENSES - Year to Date OTHER INSTITUTIONAL MEASURES - Year to Date
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Assumptions - Operating Statistical Measures
Discharges and Case Mix AssumptionsDischarges include all discharges except normal new bornsPediatric cases are those discharged from 7 West, 7 Central, 7 North, NICU and PICUPsychiatric cases are those discharged from 5 East TCH cases are those discharged from the TCH, excluding any Medicare interrupted staysAll other cases are reported as AdultShort Stay Discharges include both short stay and post procedure patientsCase Mix Index for All Acute Inpatients is All Payor Case Mix Index from Stat Report
Other Institutional Measures AssumptionsPatient Days, ALOS and ADC f igures include all patients except normal new bornsSurgical Cases are the number of patients/cases, regardless of the number of procedures performed on that patient
Assumptions - Operating Financial Measures
Revenues and Expenses Assumptions:Medicaid out of state is included in MedicaidMedicaid HMOs are included in MedicaidPhysician portion of DSH is included in OtherNon-recurring revenue is included
Other Institutional Measures AssumptionsCollection % of Gross Billings includes appropriationsDays of Revenue in Receivables (Gross) is the BOV definitionCost per CMI Adjusted Discharge uses All Payor CMI to adjust
University of Virginia Medical CenterSUMMARY OF OPERATING STATISTICS AND FINANCIAL PERFORMANCE MEASURESFiscal Year to Date March 31, 2018 with Comparative Figures for Prior Fiscal Year to Date March 31, 2017
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.D.2. Fiscal Year 2019 Operating and Capital Budgets for the University of Virginia Health System
BACKGROUND: The Health System includes the Medical Center, the School of Medicine (SOM), the University of Virginia Physicians Group (UPG), and the Library. The Medical Center, School of Medicine, and Library’s operating and capital budgets are consolidated with the University’s overall budget as divisions of the University. UPG, a separate corporation, is reported separately from the University. The Board of Visitors acts on the proposed budget based on a recommendation of endorsement from the Health System Board.
DISCUSSION: For Fiscal Year 2019, the Health System is budgeting a $23.1M operating surplus. This is comprised of the Consolidated Medical Center’s operating income of $87.4M and the Consolidated SOM’s operating loss of $64.4M (before Medical Center non-operating support and transfers totaling $46.7M). The Academic Division includes significant investments into the research enterprise while the Clinical division (UPG) is driven by retirement and pension expense and lower clinical margins.
Operating Income Comparison (before Support Transfers)($'s in millions)
FY19B FY19LRP*Fav/(Unfav)
Variance Explanation
MC Consolidated 87.4 91.1 (3.6)
Expense growth driven by depreciation, pharmaceuticals and supplies but largely offset by various cost control initiatives and commerical contracts.
SOM Academic (50.8) (51.0) 0.2 Increased strategic investments offset by reduced compensation increases.
UPG-SOM Clinical (13.3) (16.3) 3.0 New Radiology division surplus, improved productivity, and reduced compensation increases.
Library (0.2) (0.3) 0.1
SOM Consolidated (64.4) (57.3) 3.2
Operating Income/(Loss) 23.1$ 23.5$ (0.4)$
*LRP adjusted by $25.2M for 340B drug program, net patient service revenue corrections & SIF funds not received
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The Health System significant strategic investments are described below.
OPERATING PLAN: The rapidly changing health care environment will require continuous examination of budget assumptions and on-going financial performance. Through continuous improvement activities using lean methodologies, leadership will identify and implement quality and process improvement strategies that will allow for operational streamlining and cost efficiencies.
The major strategic initiatives that impact next year’s fiscal plan include:
Operational planning for transition into hospital expansion space. Execution of expense reduction plan, with specific focus on supply pricing
improvement and reductions in supply utilization and variances in clinical practice.
Advancement of ambulatory optimization work, including the continued implementation of patient-centered centralized scheduling.
Continued development of the Specialty Pharmacy program. Implementation of nurse retention plan aimed at improving nurse satisfaction
and reducing turnover and use of contract labor. Continued focus on team member/patient safety and quality outcomes
improvement. Maintaining market driven and performance compensation enhancements for
faculty and staff. Implementation of Workday and UFirst Human Resources service delivery plan. Development of School of Medicine IT infrastructure, data and analytic
capabilities. Initiating clinical translational research project. Continued development of internally managed employee wellness program (Be
Well).
The major risk factors that impact the ability to accomplish the budget include:
Federal and state legislative pressures, specifically related to further payment reductions (e.g. 340B, GME, IME, and facilities fees).
Continued increase in consumerism; pressure on cost of care and price transparency, specifically for commodity services.
Maintaining and growing a superior workforce in an environment where workforce shortages are projected.
Ability to contain costs and gain efficiencies, serving as both as the community safety net and a regional tertiary quaternary health system.
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School of Medicine
The Academic Enterprise’s operating margin before support transfers is ($50.8M) and after transfers of $41.2M is ($9.6M). The transfers include support for operating expenses, mainly for research, which would not occur if there was no support. The Academic Enterprise’s operating margin after transfers includes two significant one-time, non-recurring items. The first is a transfer from the Medical Center of $11.3M for the renovation of Pinn Hall. These funds are included in the Operating statement of the School; however, these are used for capital improvements. The second is the strategic spending. These funds are used for one-time, strategic investments by departments in research, education, and clinical practice. The Dean funds these investments with reserves and not with ongoing recurring operating funds. To review the sustainability of the School’s operations, the Pinn Hall transfers and the strategic spending need to be excluded. The School’s operating margin after transfers (excluding the Pinn Hall transfer) and before strategic spending is $7.8M.
The education mission is composed primarily of the Medical Education Program, the Biomedical Sciences Graduate Program, and the Masters of Public Health Sciences. The Board of Visitors has approved a 3% tuition increase for the Biomedical Sciences Graduate Program and the Masters of Public Health Sciences programs. Tuition and fees for the Medical Education Program will remain the same as in Fiscal Year 2018. The School of Medicine faculty also provide the training for the Graduate Medical Education and Fellowship programs.
The total grant revenue for Fiscal Year 2019 budget is projected to increase 5.5% over the Fiscal Year 2018 budget. The research mission is anticipated to grow in the coming years resulting from material investment in the expansion of the research portfolio, including the Strategic Hiring Initiative, the Translational Health Research Institute (THRIV), as well as research programs funded through Strategic Investment Funds (SIF) provided by the University. Due to space constraints identified during the development of Integrated Space Plan (ISP), only two new Strategic Hires have been signed in Fiscal Year 2018 and are included in the Fiscal Year 2019 budget. The percentage of grant revenue covering faculty salaries increased from 27.4% in Fiscal Year 2018 budget to 28% in Fiscal Year 2019 budget, which positively affects the operating income of the School of Medicine. The Facilities and Administrative (indirect cost recoveries) effective rate is projected to increase from 30% in Fiscal Year 2018 to 33.4% in Fiscal Year 2019, reflecting higher budgeted spending on NIH grants as well as a higher Facilities and Administrative rate on the federal awards. This increase positively affects the operating income of the School of Medicine.
Total capital spend for the education mission is budgeted at $26.4M in Fiscal Year 2019. Most notably, and materially significant, is the Pinn Hall renovation. Approximately $15.6M of the capital spend is related to this project.
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The Clinical Enterprise is comprised of professional services provided through UPG. The Fiscal Year 2019 budget’s operating loss before and after support transfers is ($13.3M) and ($7.7M), respectively. This reflects increases to patient care volumes through local and regional growth, close management of operating costs, and continuing support of the academic mission. The Fiscal Year 2019 budget includes an 8.8% increase in patient care volumes over Fiscal Year 2018 projection. Of the growth, 4.5% will come as a result of recovery of volumes after downturn from the Epic system implementation, and increases in same stores business in existing locations. The remaining 4.3% growth in patient care volumes is primarily driven by expansion of Radiology services in the northern market, and other new business in the form of partnerships and expansions. Total expenses are expected to increase 4.5% over the Fiscal Year 2018 projection, reflecting close management of operating costs offset by variable cost increases from volumes. Labor is projected to increase 4.8% over the Fiscal Year 2018 projection, with UPG administrative operations maintaining flat full-time equivalents (FTE’s) year over year. Contributions to the research and teaching efforts of the School of Medicine are reflected in the plan at $31.1M. Capital spend is budgeted at $7.0M in Fiscal Year 2019, primarily due to relocation and refurbishment of Clinical Practice locations.
Medical Center
Market Conditions: For Fiscal Year 2019, discharges are budgeted to grow 0.5% from Fiscal Year 2018 projected levels. Although statewide admissions are trending downward, our budgeted projection is driven by targeted growth efforts across Cancer, Heart and Vascular, and Transplant. Outpatient services are expected to grow by 3.7% in total.
The following table includes historical and projected patient volumes:
Actual Projected BudgetFY 2017 FY 2018 FY 2019
Discharges - Medical Center (MC) 27,642 28,973 29,104Discharges - TCH 404 355 413Adjusted Discharges 62,497 62,663 63,055Average length of stay - MC 6.03 6.23 6.20Average length of stay - TCH 25.74 28.33 28.25Outpatient Encounters - MC 761,916 751,049 778,534
Revenues: Fiscal Year 2019 budgeted revenue is $1.748B, 4.7% above projected Fiscal Year 2018 revenue. The Medical Center has seen a disproportionate share of revenue growth in Medicaid and Medicare, and we expect this trend to continue as the population ages. One of the Medical Center’s largest challenges is the unwillingness of government payers to increase their payments commensurate with the increases in medical delivery costs. Growth in revenues into Fiscal Year 2019 will result from rate increases in commercial contracts and a slight uptick in volumes.
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Medical Center outpatient surgical volumes are expected to increase 3.9% as the number of procedures available in the ambulatory setting continues to increase, while main operating room surgeries are expected to grow 0.9%.
The Medical Center expects an aggregate rate increase of 5.0% on commercial contracts, which is commensurate with rate increases that will generally be implemented in the hospital industry.
Expenses: Expenses from operations are projected to increase by $49.8M from the Fiscal Year 2018 projection, a 3.1% increase. This represents a 2.2% increase when adjusting for patients’ acuity (CMI), requiring more clinical care resources.
Previous increases in capital investment will result in additional net depreciation expense of $6.1M for Fiscal Year 2019 as we invest in strategic projects. Additionally, interest cost on capital investments is increasing by $0.1M for Fiscal Year 2019. The Medical Center’s 2018-2019 fiscal plan accounts for these additional expenses while preserving its goal of providing high quality and cost effective health care, education, and research services.
Staffing: The Medical Center’s Fiscal Year 2019 budget has been benchmarked with comparable academic medical centers. FTEs are planned at 8,827, an increase of 146 FTEs from the current Fiscal Year projection of 8,681 FTEs. Please see below reconciliation:
Projected FY18 FTEs 8,681 Budgeted FY19 FTEs 8,827 FY18 A to FY19 B Change 146 1.7 % Increase
BreakdownCentralized Scheduling / Ambulatory Optimization 50 Hospital Expansion Ramp-up 20 HIT/EPIC Support (new/on-going) 16 Volume and partial FTEs in 18', full in 19' 60
With regard to compensation increases, the pool for market and merit actions has been established at $9.6M, which includes the impact on benefit costs and is based on a 2.0% average salary adjustment and October implementation date. Compensation changes related to market comparisons will be done strategically to maintain competiveness across various hard-to-fill or retain positions. Merit increases will be based on Fiscal Year 2018 performance reviews for team members across the entire organization.
A summary of historical and projected financial operating results are provided as follows:
Actual Projected Budgeted
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(Millions) FY 2017 FY 2018 FY 2019
Total operating revenue $1,604 $1,670 $1,748Operating expense 1,522 1,610 1,660Operating income 82 60 87Transfers to SOM* (40) (48) (47)Total Net Income $42 $12 $41
Operating margin 5.1% 3.6% 5.0%
EBITDA** $157 $129 $164
* Represents Medical Center Transfers to the SOM. All other non-operating, such as investments and joint ventures are excluded from this presentation.** EBITDA is operating earnings before interest, taxes, depreciation and amortization.
Capital Plan: Funds available to meet capital requirements are derived from operating cash flows, funded depreciation reserves, philanthropy, and investment income. The Health System faces many challenges regarding capital funding as continued pressures on the operating margin affect cash flow, while demand for capital has increased significantly due to space requirements, technological advances, and aging of existing equipment and facilities. Subject to funds availability, the Health System management team recommends $164.9M be authorized for Fiscal Year 2019 capital requirements. Request per enterprise: Medical Center $131.5M, SOM $26.4M (with $2.5M funded from external sources), and UPG $7.0M.
Transitional Care Hospital
Market conditions: For Fiscal Year 2019, discharges are budgeted with a 16% growth from Fiscal Year 2018 projected levels. The growth will be facilitated by increased focus on the ventilated patient population and expansion of the referral base. The following table includes historical and projected patient volumes:
Actual Projected BudgetFY2017 FY2018 FY2019
Discharges 404 355 413Average Length of Stay 26.9 28.3 28.3Patient Days 10,888 10,047 11,680
Revenues: Fiscal Year 2019 budgeted payor mix reflects an increase in Medicare cases from prior year. Growth in revenues will result from the impact of increasing volume, higher acuity patients, and managing length of stay.
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The Centers for Medicare & Medicaid Services (CMS) proposed base rate for Fiscal Year 2019 is $40,879 per case which is a 1.5% reduction from prior year. With a Medicare CMI of 1.18, this will result in a total Medicare reimbursement rate of $48,237 per LTCH CMS full Prospective Payment System (PPS) payment per case. This rate also includes full participation in the Hospital Inpatient Quality Reporting Program and meets the four claims-based measures. It is projected that 10% of the Medicare cases will not meet the full LTCH base payment of $48,237 due to the 3-day ICU requirement on wound cases. The Fiscal Year 2019 budget reflects the net revenue reduction for site-neutral cases.
Expenses: While expense increases over the Fiscal Year 2018 projection by 12%, most of that is driven by higher volume. Expenses per patient day from operations (labor, supplies, and purchased services) are budgeted with a slight 0.2% increase.
Staffing: FTEs are budgeted at 138, an increase of 18 FTEs from the current fiscal year projection, due to staffing shortage in Fiscal Year 2018. TCH has experienced a patient/ nurse ratio of 4:1 to 5:1. This includes the charge nurse taking patient assignments as well as the Nurse Manager. TCH is heavily recruiting qualified clinical staff (RNs and PCAs) in order to maintain the desired 4:1 patient/nurse ratio while increasing volume to a desired 32-34 average daily census. This variance reflects the FTE vacancies that TCH is in the process of filling.
A summary of the TCH projected financial operating results are provided as follows:
Actual Projected Budgeted(Millions) FY 2017 FY 2018 FY 2019
Total operating revenue $18.9 $20.8 $23.1Operating expense 18.7 20.2 22.8Operating income / (loss) 0.2 0.6 0.3Total margin 1.3% 2.8% 1.3%
Capital Plan: Funds available to meet capital requirements are derived from operating cash flows, funded depreciation reserves, philanthropy, and interest income. Subject to funds availability, TCH management recommends $100K be authorized for capital requirements. Beginning July 2018, TCH will begin the renovation of upgrading Outtakes Morrison food services in order to “plate and serve” hot meals to patients and families. In addition, TCH will have an on-site pharmacy located on the third floor.
ACTION REQUIRED: Approval by the Health System Board, the Finance Committee, and by the Board of Visitors
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FISCAL YEAR 2019 OPERATING AND CAPITAL BUDGETS FOR THE UNIVERSITY OF VIRGINIA HEALTH SYSTEM
RESOLVED, the Fiscal Year 2019 Operating and Capital Budgets for the University of Virginia Medical Center and Transitional Care Hospital are approved, as recommended by the President, the Executive Vice President for Health Affairs, the Chief Operating Officer of the University, and the Health System Board.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: I.E. Health System Development Report
ACTION REQUIRED: None
BACKGROUND: Health System Development reports on recent activity to the Health System Board from time to time. Ms. Karen Rendleman, Senior Associate Vice President for Health System Development, has directed Health System fundraising efforts since 2006 and has been a member of the University of Virginia development community since 1988.
DISCUSSION:
SIGNIFICANT GIFTSJanuary 1 – March 31, 2018
A grateful patient committed $1.5 million to the Center for Biomedical Ethics and Humanities at the School of Medicine.
A friend of the Health System documented a $900,000 bequest to establish a named Research Fund in Schizophrenia and Bipolar Disorders.
A grateful patient made a $790,000 multi-year pledge in support of Dr. Craig Slingluff’s work in Immunology.
The Soho Center made an in-kind contribution of books to UVA Children’s Hospital valued at $731,668.
The Lettie Pate Whitehead Foundation committed $524,000 in scholarship funding for the School of Nursing and School of Medicine for the 2018-2019 academic year.
The Main Event gala raised $234,475 to benefit the inpatient unit renovation at UVA Children’s Hospital.
A grateful patient documented a $150,000 bequest to establish a named Clinical Education Fund in Lung Transplant Care.
A grateful patient documented a $150,000 bequest to establish the Anne Bryan Pennington Olson Adult Congenital Heart Education Fund in the Division of Cardiovascular Medicine.
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A UVA alumnus and his wife have committed $150,000 to be divided evenly among research support for Dr. José Oberholzer (transplant), Mark Kester, PhD (nanomedicine), and Dr. Trey Lee (pediatric cancer).
MADithon, the student-led dance marathon at James Madison University, raised $117,133 for UVA Children’s Hospital.
A School of Medicine alumnus made a $100,000 bequest in support of a scholarship for black medical students.
A UVA alumnus and his wife are establishing a $100,000 planned gift that will benefit the Health System for an area as yet to be determined.
Other gifts and pledges received include:
A $50,000 estate distribution in support of the School of Nursing; A $50,000 gift in support of investigator Mike McConnell’s research in human induced
pluripotent stem cells; A $50,000 pledge to benefit the work of Dr. Charlie Friel and Dr. Matt Barrett in
Colorectal Surgery and Neurology; A $50,000 gift to the School of Medicine Class of 1984 Fund through a deferred
annuity in support of medical scholarships; A $40,000 gift to benefit Colorectal Surgery and Neurology; and A $25,000 commitment in support of Dr. Tom Loughran’s LGL Leukemia Research
Program.
OTHER DEVELOPMENT INITIATIVES
On January 25, UVA Health Foundation Board Chair Jimmy Orr and his wife, Vicki, hosted 34 guests at an engagement event in their home in Bonita Springs, Florida with guest speaker, Dr. Jayakrishna Ambati, Professor of Ophthalmology & Vice Chair for Research, and Director of the Center for Advanced Vision Science.
Medical Center CEO Pamela Sutton-Wallace, School of Medicine Dean David Wilkes, MD, and Dr. José Oberholzer participated in a special stewardship visit planned for a UVA Health Foundation emeritus trustee and her family to acknowledge their generous support of the Charles O. Strickler Transplant Center.
On February 2, School of Nursing Dean Dorrie Fontaine hosted a reception in New York City for alumni, parents, donors, and friends to provide an update on the School.
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Several Health System investigators participated in a four-day site visit by a major University donor and his son regarding collaborative efforts between the UVA Brain Institute, College of Arts & Sciences, School of Medicine, and the Jefferson Scholars Foundation.
The Health System Development Office is cultivating a relationship with Tom Skalak, former UVA Vice President for Research and current Foundation Executive Director of the Paul G. Allen Frontiers Group of the Allen Institute, to explore the Institute’s interests in funding brain and cell science. The Frontiers group is announcing a new $40 million initiative in brain health and cognitive impairment and has expressed an interest in the work of UVA investigator Jonathan Kipnis, PhD.
FUNDRAISING PROGRESS THROUGH March 30, 2018
Giving Summary (through March 2018; 75% of fiscal year elapsed)
FY 18Goal
FundraisingProgress*
PercentAchieve
d
Compare FY 17
New gifts $45,000,000 $23,351,149 51.9% $27,859,492New pledges $7,000,000 $6,746,515 96.4% $8,414,763Total new commitments* $52,000,000 $30,097,664 57.9% $36,274,255
New expectancies $10,000,000 $13,756,967 137.6% $6,625,000
Total new gifts, pledges, and expectancies
$62,000,000 $43,854,631 70.7% $42,899,255
* excludes pledge payments on previously booked pledges
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: II.A. Signatory Authority Related to Medical Center Contracts Exceeding $5 Million Per Year
BACKGROUND: The Board of Visitors is required to approve the execution of any contract where the amount per year is in excess of $5 million.
DISCUSSION: In accordance with Medical Center procurement policy and its group purchasing organization affiliation with Premier Healthcare Alliance, LP, the four contracts listed below exceed $5 million in spend per year, and thus, exceed the signatory authority of the Executive Vice President for Health Affairs.
Virginia Blood Services, for blood products & services; Medtronic for spinal implants; CDW Corporation for computer hardware, software, servers & peripherals; Hill-Rom for nurse call system, upgrade of existing infrastructure, and new patient
tower.
The expense for goods and services purchased through these contracts is reflected in the Medical Center’s Operating and Capital Budgets.
ACTION REQUIRED: Approval by the Health System Board, the Finance Committee, and by the Board of Visitors
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SIGNATORY AUTHORITY FOR CERTAIN MEDICAL CENTER CONTRACTS EXCEEDING $5 MILLION PER YEAR
RESOLVED, the Board of Visitors authorizes the Executive Vice President for Health Affairs to execute contracts on behalf of the Medical Center with Virginia Blood Services, Medtronic, CDW Corporation, and Hill-Rom.
UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: II.B. Medical Center Chief Executive Officer Remarks
ACTION REQUIRED: None
BACKGROUND: As approved in the Ivy Mountain Master Plan, the Ivy Mountain Musculoskeletal Center (IMMC) project includes an approximately 200,000 GSF facility that will provide modern, comprehensive orthopedic outpatient clinics and surgical services, as well as a central utilities plant to serve the IMMC and future redevelopment of the Ivy Mountain site. Demand for orthopedic services is expected to increase over the next several years, and the center will co-locate UVA’s outpatient orthopedic services and provide patients with a comfortable and accessible facility specializing in sports medicine, hand, spine, joint replacement, orthopedic trauma, and foot and ankle practices. This full-service, patient-centric center will also offer prosthetics and orthotics, diagnostic imaging, a pharmacy, physical therapy, and a surgery center with extended recovery beds. The building’s design and use of materials enhance the patient experience by connecting the natural beauty of the site, maximizing natural light, and providing views from all patient and public spaces.
DISCUSSION: The design team, led by ZGF Architects in collaboration with the Architect for the University and representatives of the Health System and Facilities Management, has developed a schematic design that Ms. Raucher will review with the Buildings and Grounds Committee and seek its approval. This summary is being shared with the Health System Board for informational purposes.
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Health System Context
Ivy Mountain: Proposed Musculoskeletal Center Site Plan
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View of Existing Conditions from corner of Route 250 and Stillfried looking West
Proposed View from corner of Route 250 and Stillfried looking West
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: II.C. Medical Center Chief Executive Officer Report
ACTION REQUIRED: None
BACKGROUND: Pamela M. Sutton-Wallace is the Chief Executive Officer for the University of Virginia Medical Center. She joined the Medical Center in July 2014 and oversees the strategic direction and operations of all inpatient and ambulatory services of the Medical Center.
DISCUSSION: This report summarizes operations of the Medical Center focusing on the Fiscal Year 2018 priorities of quality and safety, patient experience, team member engagement, as well as financial performance and growth.
OPERATIONS REPORTHEALING:
Performance on all key metrics of the Medical Center Balanced Scorecard’s Healing quadrant improved in the third quarter of the fiscal year. Ongoing work of the Clostridium Difficile Colitis Reduction Coalition continues to improve outcomes. As of the end of the third quarter, these infections are down 30% from the same time last year. Additionally, the most recent Pressure Ulcer Prevalence survey of the Medical Center has showed marked improvement, currently at 1.80% and trending positively towards the 1.64% target. Lastly, patient handling injuries have declined 63% from Fiscal Year 2017 to Fiscal Year 2018.
The Ambulatory Optimization initiative has moved from analysis of the current operating condition to planning for system-wide changes to improve patient access, clinic operational efficiency, and team member and patient satisfaction. A multidisciplinary team of front line clinic staff from across the Health System reviewed hundreds of hours of observation data from the 12 pilot clinics. The team identified a number of high impact opportunities for improvement and shared these with the Ambulatory Optimization Steering Committee. As a result, the committee established four teams to develop specific improvement efforts at the system level and plans for their implementation. Those four teams will focus on:
Patient access standards, scheduling, and templates Role delineation and operational standard work Outside medical records management Proficiency and efficiency in the use of clinic IT systems
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Implementation of these system improvements will begin by the start of the upcoming fiscal year, while local improvement opportunities at the 12 clinics resulting from the observations are currently under way.
SERVING:
Inpatient patient experience performance as reflected in the overall hospital rating of 9s and 10s for Fiscal Year to date 2018 (as of March 2018) is 77.3% (71st percentile), better than target and matching stretch target (77.3%). This is a significant increase over the Fiscal Year 2017 of 72.0% and Fiscal Year 2016 of 70.5%. The improved and sustained performance resulted from focus on the Inpatient Experience Bundle (Leader Rounding, Comfort Rounds, Bedside Handover of Care, and Quiet at Night) with particular attention on Leader Rounding. Unit leadership teams continue to increase the number of patients they round on daily to an average of 9,700 patient touches per month and over 11,000 in March. Not only does leadership rounding support immediate problem-solving remediation, but it also has had a significant impact on overall satisfaction and will continue to do so as an increased number of patients are rounded on daily.
Outpatient clinic patient experience results defined as the overall doctor rating for the Fiscal Year to date 2018 (as of March 2018) is 86.9% (51st percentile), just under target (87.2%) but over prior Fiscal Year 2017 (85.9%). Improvement can be attributed to the service line specific improvement strategies to address coordination across the care continuum and the organization’s focus on Ambulatory Optimization.
The Emergency Department Fiscal Year to date (as of March 2018) patient experience score is 83.4 (50th percentile). This is below Fiscal Year 2017 (83.6). The Patient Experience Bundle, Rapid Medical Evaluation and “direct to bed” (bedside triage) continue to be the focus for the team. The team started Emergency Department Leader Rounding in April and is expecting the same positive impact as experienced in the inpatient environment.
ENGAGING:
Teams and leaders continue to work on engagement action plans based on opportunities for improvement identified through the 2017 engagement survey. The 2018 Health System Engagement survey occured April 24 through May 15. The survey was administered using Press Ganey again as the vendor. Results will be available in July. Education for all leaders and support of low scoring teams and leaders will be provided as action planning expectations will be set for the fall.
Voluntary turnover has remained stable this year at or near 13.0%. Registered Nurse voluntary turnover Fiscal Year to date is 13.3%, which is improved from Fiscal Year 2017 (13.5%).
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BUILDING:
Through nine months of Fiscal Year 2018, the Medical Center has experienced unfavorable financial performance, with an operating margin of $30.2M (2.4%) against a budget of $38.2M (3.1%). Since the last report in December, after which six months financial performance was favorable to plan, the Medical Center has experienced three months of decreased reimbursement resulting from unplanned changes to 340B qualified outpatient drugs, a lower than expected volume in outpatient visits and surgeries, as well as an overstatement of revenue in the Fiscal Year 2018 budget for home care services. Diligent remediation efforts are in place to improve financial performance. This includes actively reducing use of external contract labor, which has begun to trend downward, eliminating recruitments for non-essential fixed positions, and eliminating all identifiable barriers to patient scheduling, in which early indications of April volumes look promising. Further, work continues to execute the medical supply expense reduction. At this point, a budget shortfall is anticipated given the amount of time for improvement remaining in the fiscal year, but commitment remains to closing that gap as much as possible and keeping momentum on continued financial improvement.
The University Hospital Expansion project remains on schedule and within budget. Medical Center executive leadership is maintaining regular steering committee meetings which have begun to shift focus more towards operational planning and implementation. Resources have been included in the latter months of the Fiscal Year 2019 operating budget and work will begin in the coming months to develop a robust building activation plan.
The Ivy Mountain project planning is reaching conclusion and schematic design will be presented for approval at the June Building & Grounds Committee.
The Medical Center held a leadership retreat in early February. Christopher Kerns from The Advisory Board Company presented the “State of the Union – the Next Wave of Health Care Reform” and cost containment strategies based on pressures that are anticipated to squeeze hospital operating margins. There was agreement at the retreat that in Fiscal Year 2019, Balanced Scorecard data will be organized by the six Health System goals instead of the four (Healing, Serving, Engaging, Building) quadrants.
Recent Designations and Re-certifications
The Centers for Medicare and Medicaid Services completed a triennial re-certification inspection of Augusta Dialysis for the End Stage Renal Disease Program.
The Virginia Department of Health completed a review of the Ryan White Program.
The Radiation Injury Treatment Network completed a routine survey of Radiology Services.
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The Virginia Department of Health completed a survey of the Trauma Program as part of designation as a Level 1 Trauma Center.
The Cystic Fibrosis Foundation completed an accreditation survey of the adult Cystic Fibrosis program.
The Virginia Department of Health completed a routine inspection of Continuum Home Health Services.
The Virginia Board of Pharmacy completed a routine inspection of the Infusion Pharmacy in the Battle Building.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: III. School of Medicine Report
ACTION REQUIRED: None
BACKGROUND: David S. Wilkes, M.D. is the Dean of the School of Medicine. Dr. Wilkes is a nationally recognized specialist in pulmonary disease and critical care medicine. Before coming to UVA, Dr. Wilkes served as Executive Associate Dean for Research Affairs at the Indiana University School of Medicine.
DISCUSSION: Shortly after his arrival in September 2015, Dr. Wilkes announced the Strategic Hiring Initiative (“SHI”), which has the goal of transforming the research program at the School of Medicine through the recruitment of 32 funded mid- and senior-level faculty who collaborate across departments and schools. The SHI supports the School’s goal of increasing NIH funding by $50 million by 2020.
EDUCATION REPORT
The U.S. News and World Report 2019 rankings of graduate programs showed a rise in the rankings of the School of Medicine. Primary Care is ranked at 21st (a tie, and up from 24th), and Research is ranked at 26th (also a tie, and up from 27th).
The State Council of Higher Education for Virginia informed President Sullivan that the organization approved the establishment of the UVA School of Medicine Inova Campus in Fairfax.
In May 2018, the School of Medicine graduated 157 undergraduate medical students (M.D. degrees), 20 graduate students (Ph.D. degrees), eight M.S.-Clinical Research students, and 23 Masters of Public Health students.
Our medical students had a 99% success rate in the March residency Match. The most popular programs were internal medicine with 35 people matching; emergency medicine, obstetrics and gynecology, and pediatrics, each with 15 matches; and anesthesiology with 13 matches. Of our 157 MD graduates, 16 will train for all or part of their residency at UVA. Other graduates will be going to Yale, Emory, Penn, Vanderbilt, UPMC, Johns Hopkins, Massachusetts General, Wake Forest, and Chicago, as well as other institutions throughout the nation.
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All new 161 resident slots were filled. We have mostly a regional and eastern draw, although the School of Medicine attracts trainees from across the nation.
DIVERSITY REPORT
The School of Medicine must provide a status report to the Liaison Committee on Medical Education (LCME, the accreditation agency for medical schools) on August 1, 2018. The LCME is monitoring the School’s diversity/pipeline programs and partnerships. We have made significant improvements in the diversity of our undergraduate medical student population, and, as the chart below shows, we have seen concurrent improvement in our test scores.
Our August report to the LCME must also address the diversity of our faculty, including what steps we have taken to increase it. Those measures include active, continuous recruitment and targeted networking at professional meetings and promoting every job posting on external diversity sites. All departments have developed diversity plans, identified a diversity liaison, and report to the Dean about the outcomes during the annual department review. The Dean is available to meet with all underrepresented minority recruits, even on the first visit. While we have made progress in 2017 in recruiting underrepresented minority faculty members, we still have work to do.
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Graduate trainees are an important part of the pipeline. By retaining our students as trainees, we ensure a strong and qualified pool to recruit into faculty positions. We have employed a number of strategies to help attract trainees who are underrepresented in medicine, including institutional Diversity Days and Second Look Days, unconscious bias training, using the website to communicate visually our diversity, and phone calls from the Dean to underrepresented minority resident and fellow candidates. The chart below shows the progress that we have made in increasing the diversity of our residents and fellows.
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The search is underway for the Health System’s Chief Inclusion and Wellness Officer. We anticipate that this person will be a partner in our efforts to increase diversity and nurture an environment that fosters inclusiveness.
The Be Wise initiative is designed to provide coaching resources and tools to address and improve core behavioral and cultural competencies. Dr. Margaret Plews-Ogan, Dr. Gregory Townsend, and Ms. Denise Stewart from the Drama Department have created vignettes that portray real events of bigotry and prejudice that have occurred in patient care settings. The videos set the stage for training faculty and staff in how to respond to challenging situations and to know what resources are available throughout the University. UVA is at the forefront of addressing these incidents and there is national interest in our work. A sample video can be seen at https://www.dropbox.com/s/ajxy5wxx4msmgcr/Scenario%204%20-%20edit.mov?dl=0.
GLOBAL GENOMICS AND BIOMEDICAL RESEARCH INSTITUTE (GBRI) REPORT
The work continues to move the GBRI project forward. Construction bids will go out before July and construction on Building C will start late this year, immediately after the Fairfax County permitting process concludes. Occupancy is planned for early 2020. In addition, Inova’s application for rezoning of the former ExxonMobil property has been approved. The application will go to the County Board of Supervisors meeting in June, followed by a six-month work study to consider impact on traffic, utilities, open space, etc. Inova has also submitted applications to increase the amount of building square footage allowed on the tract of land. They expect to start development activity in June 2019.
Two faculty members (cardiovascular medicine and pediatrics) have signed offer letters that includes space at the GBRI where they will establish satellite laboratories. Another recruit has expressed a desire to have a presence at the GBRI. Discussions are underway with the Data Science Institute to occupy a portion of the UVA space contiguous to the GBRI. Anticipating that some of these recruits will need to set up operations prior to the opening of Building C, the School of Medicine and Inova are working together to identify temporary swing space in an adjacent building.
STRATEGIC HIRING UPDATE
Dr. Andrew Schaefer, Professor of Medicine in Hematology-Oncology at Weill Cornell, visited the School of Medicine in April to conduct an external assessment of the Strategic Hiring Initiative. He met with Strategic Hiring Initiative recruits, hiring department chairs, collaborators, Strategic Hiring Initiative committee members, and the Dean and the Senior Associate Dean for Research.
Dr. Schaefer stated that we have recruited excellent scientists and they are well distributed among disciplines. He noted that while funding is important, it is critical to hire individuals who can make a difference, and a number of the Strategic Hiring Initiative hires have already made an impact through collaborations within the School and across Grounds,
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by bridging basic and clinical research, by establishing programs that align with University and Health System goals, and through new grants and publications.
Accountability is also important, and the program must demonstrate productivity resulting from the institution’s investment. The Strategic Hiring Initiative is less than three years old and early results demonstrate that it is returning value on the investment. Since its implementation in March 2016, we have recruited twelve Strategic Hiring Initiative candidates and seven related strategic recruits, for a total of nineteen key strategic hires. These individuals brought $20.9 million in their first year and $60.4 million over five years.
The effect of these hires is not limited to the funding they bring. As noted above, they are making an impact through collaborations across departments and across schools. For example, two Strategic Hiring Initiative hires in transplant and adaptive cell therapy (Oberholzer, Lum) are part of a successful Strategic Investment Fund application to treat and cure Type 1 diabetes. Two Strategic Hiring Initiative hires in Endocrinology (A. Basu and R. Basu) have joined the Strategic Investment Fund effort and have begun educational and research collaborations with the Cardiovascular Research Center and the Data Science Intitute. This larger diabetes group is mounting an effort to submit 10 multi-Principal Investigator grants in response to a special NIH opportunity (RFA), which involves four School of Medicine departments and two School of Engineering and Applied Science departments. Dr. Sean Moore, a Strategic Hiring Initiative hire in Pediatrics, is working with colleagues in Medicine, the Institute for Global Health and Diseases, and the Gates Foundation to develop a research facility and projects to study the influence of the microbiome on numerous diseases. Strategic Hiring Initiative hire Dr. Francine Garrett-Bakelman is part of a multiple Principal Investigator consortium between the School of Medicine, College of Arts and Sciences, and Signature Sciences that is proposing to do research on the human epigenome in response to environmental toxins.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
AGENDA ITEM: IV.A. Transitional Care Hospital Operations Report
ACTION REQUIRED: None
BACKGROUND: Tracy Turman, MHA, FACHE is the Administrator of the Transitional Care Hospital, a long-term acute care hospital (LTACH). He joined the organization on January 29, 2018, and oversees all operations of this long-term acute care facility.
DISCUSSION: This periodic report summarizes the operations of the hospital. It reflects the performance and efforts related to the four key areas (healing, serving, engaging, and building).
OPERATIONS REPORT
HEALING
The UVA TCH continues to focus on our goal of becoming the safest long-term acute care hospital (LTACH) to receive and provide care. Providing this care requires talented, well-educated team members. Sixty-one percent of our nursing staff are educated at the baccalaureate level or above, and we are supporting 24 team members currently in degree-granting programs.
Most of the patients seen at TCH fall into one of three categories to include ventilation weaning, respiratory complex care, or complex wound care. In order to meet the needs of these intensive patients, we have continued our efforts to recruit and retain nurses and respiratory therapists that will adopt our ASPIRE values.
In the third quarter of Fiscal Year 2018, we were able to hire six new registered nurses and seven new patient care assistants. We also focused efforts on obtaining additional contract nurses and were successful in contracting nine registered nurses for long-term assignments which all started in April. In addition, TCH has created a staffing tool focusing on patient acuity and began using that tool in daily assignment creation.
Rehabilitation Services are provided through the TCH Physical Therapy, Occupational Therapy, and Speech/Language Pathology programs. TCH has been contacting other LTACH providers to gauge what rehabilitation services they provide and has also been engaging staff in discussions around ways to further improve rehabilitation services. An action plan has been developed and is being updated monthly.
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Reducing staff injuries is an important part of our goal to be the safest place to work. We remain under our target for patient-handling injuries and exposures with only two patient handling incidents and five blood and body fluid exposures through March 2018.
SERVING
Our Patient Satisfaction Scores continue to reflect a high level of satisfaction with the care provided at TCH. The overall assessment rating for TCH was 88.3 year-to-date, which puts TCH in the middle range of the 10 LTACH hospitals surveyed by Press Ganey. However, we continue to have a small number of surveys returned and have refocused our efforts on survey response. As a result, we saw an improvement in late March and April. Higher return rates are expected to result in higher satisfaction scores based on findings in leader rounding.
Our most prevalent opportunities for improvement are in food quality and housekeeping. We continue to work with Nutrition Services and have developed an action plan that involves updates every two weeks to ensure short-term improvement, and we are working with Facilities to develop options to expand our abilities at TCH to provide quality food options for patients, visitors, and staff. We have met with our housekeeping contract service provider to discuss quality concerns and staffing needs. On-site supervision with both contract service providers has increased and services have improved.
ENGAGING
In the third quarter of Fiscal Year 2018, TCH held three employee retreats and one town hall to gather and share information from and with staff. Each employee-focused event was well attended and staff were engaged and actively participated. A list of suggestions from the retreats were shared with TCH leadership and an action plan was developed and is being worked through. We will be updating staff on the progress being made with such actions at each future event as well as in the TCH monthly staff newsletter.
The 2018 UVA Health System Engagement Survey took place April 24-May 15, 2018
and we are awaiting results. Once received and reviewed, our action plan will be updated to reflect these results.
BUILDING
Our Patient Progression Department manages the entire patient stay from referral to admission to discharge. Our hospital liaisons are clinicians who educate referral sources and facilitate admissions. Our case managers then take over at the point of admission to ensure a successful stay and discharge plan. We are currently conducting a performance improvement analysis that is exploring how we might make these processes more efficient, easier to navigate by referring providers and patients alike.
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In the first three quarters of Fiscal Year 2018, the TCH had 972 referrals and 269 discharges; 73% of those came from the UVA Medical Center, while the rest came from outside hospitals. Breakdown by medical categories include 27% vent weaning, 23% complex wounds and 19% respiratory complex. The remaining discharges fell into the category of medically complex patients.
Discharge to home with home health remains our highest discharge disposition of the four lower level of care options (Inpatient Rehabilitation Facility, Skilled Nursing Facility, Home, and Hospice). Our CMI is 1.13 for Medicare patients, and 1.10 for all patients. Our average length of stay for Fiscal Year 2018 quarters one through three is 28.03 days overall and 26.47 day for Medicare patients.
RECENT DESIGNATIONS AND RE-CERTIFICATIONS
The Joint Commission is expected to visit in fourth quarter of Fiscal Year 2018 to recertify TCH’s wound care program.
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UNIVERSITY OF VIRGINIABOARD OF VISITORS AGENDA ITEM SUMMARY
BOARD MEETING: June 6, 2018
COMMITTEE: Health System Board
ACTION ITEM: IV.B. Renaming of UVA HealthSouth Rehabilitation Hospital
BACKGROUND: University policy requires forwarding the names for physical structures, inter alia, on the Grounds of the University of Virginia, to the Board of Visitors for final approval.
DISCUSSION: HealthSouth Corporation and The Rector and Visitors of The University of Virginia on behalf of its Medical Center established a 50/50 joint venture in 1996, opening the 50-bed UVA HealthSouth Rehabilitation Hospital on the Fontaine Campus of the University in 1998. On January 2, 2018, HealthSouth changed its name to Encompass Health Corporation. Based on the corporate branding change by HealthSouth, the UVA HealthSouth Rehabilitation Hospital nomenclature needs to be updated to reflect the correct name of the partner.
The Medical Center proposes to change the name of the facility to UVA Encompass Health Rehabilitation Hospital. The naming change comes with the recommendation of the Names Committee.
ACTION REQUIRED: Approval by the Health System Board, the Buildings and Grounds Committee, and by the Board of Visitors
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RENAMING UVA HEALTHSOUTH REHABILITATION HOSPITAL TO UVA ENCOMPASS HEALTH REHABILITATION HOSPITAL
WHEREAS, the UVA HealthSouth Rehabilitation Hospital is located on the Fontaine Campus of the University and is a 50/50 joint venture between the UVA Medical Center and HealthSouth Corporation; and
WHEREAS, in January 2018, HealthSouth Corporation changed its name to Encompass Health Corporation; and
WHEREAS, the Medical Center desires to change the name of the Rehabilitation Hospital to reflect the change in corporate name of its partner;
RESOLVED, the Board of Visitors renames the UVA HealthSouth Rehabilitation Hospital to the UVA Encompass Health Rehabilitation Hospital.
