The UVM Health Network’s Commitment to Community and Good Governance
by Allie Stickney, Chair, UVM Health Network Board of Trustees
I was frustrated and disappointed as I read Bill Schubart's latest of several pieces criticizing the University of Vermont Health Network, an organization I've been honored to serve for more than 10 years, most recently as Chair of the Board of Trustees. Bill perpetuates misguided criticism of our health system’s size and complexity, while ignoring the very real difference the people of the UVM Health Network make in our communities every day.
By regional standards, the UVM Health Network is large. And, in order to attract skilled clinicians and leaders, it pays more than local not-for-profit organizations. The same was true decades ago when Bill chaired the Board of Fletcher Allen Health Care. Also true, however, is the critical and prominent role this organization plays as the safety net healthcare provider for our rural area. Additionally, the health system is leading or contributing to our communities on pressing issues, from the Saint Lawrence Valley to the spine of the Green Mountains. On environmental sustainability, housing and serving those with substance use disorders, we are working to make a difference. And we’re doing this at a time when hospitals and health systems across the country face existential challenges, particularly in rural areas.
Much work remains, but there is far more to honor and build from than to tear down.
We have directly provided Bill a detailed correction to his article. Here are a few points where he was most clearly off-base:
- The late Sister Irene Duchesneau from the Fanny Allen community – Sister D to her friends – often repeated a common phrase about financial management of not-for-profits: “No margin, no mission.” A theme throughout Bill’s piece is a negative connotation regarding the financial margin of our not-for-profit health system. The UVM Health Network doesn’t have shareholders: We reinvest every dollar to support our patients, our people and our communities. Without a positive margin, our system – like any other not-for-profit – would fail. In Vermont, we have the most highly regulated health care delivery system in the country: Every dollar is accounted for in publicly available documents filed with the Green Mountain Care Board (GMCB).
- Our Board uses a comprehensive, objective process for leadership recruitment and compensation. It’s not determined solely by financial performance. Nor should it be, given our responsibilities to our patients and employees. All leaders receive a portion of their compensation based on the organization’s performance against clinical care goals, employee and patient-experience measures, and diversity and equity metrics. Our Board, which determines this process, consists of 20 members from a broad range of backgrounds and geographies – from physician provider to community development leader to human resources expert, representing communities from Malone, New York, to Berlin, Vermont.
- We also tie leader-compensation decisions to objective benchmarks – data provided by firms reporting directly to our Board – for consistency and competitiveness among like-sized health care systems. There was a time when people would accept less pay to live and work in our region. That’s no longer true. We often lose talented candidates to organizations willing to pay more elsewhere. Benchmarks allow us to target like-sized organizations. We don’t peg our CEO’s compensation to a system as large as the Mayo Clinic, as Bill implied.
- In the 20 years since Bill negotiated the compensation package for then-Fletcher Allen Health Care CEO Dr. Estes, national wage inflation has varied from a low of just over 1.5% to a high of almost 7%. If Dr. Estes had stayed the last 20 years, and her compensation increased 3% each year, today it would total approximately $1.6 million. Meanwhile, the complexity and size of our organization has multiplied to include approximately 15,000 employees serving a population of 1 million across two states.
- Bill’s opinion piece cites data, presented by the GMCB, that we believe incorrectly portrays the ratio of administrative and general salaries to clinical salaries at UVM Medical Center. The 31% figure he references was not standardized for differences in how organizations account for administrative shared services (HR, contracting, supply chain, etc.) that are reimbursed by other partners within the health system, and also for which organization within the system employs their physicians. When properly adjusted, those costs are 24%. That’s the fifth-lowest rate of the 12 northeastern academic medical centers. Further, it’s not valid to compare the administrative ratios of health insurers and providers: We are entirely different types of organizations.
Looking to the future, the assets of this community far outstrip its deficits. Recently, Vermont placed third in the nation in health rankings by the United Health Foundation, affirming things we often take for granted. This ranking is the product of tremendous individual efforts – including by Bill, who has given much to our Burlington community – as well as the work we have done together over the decades to improve the health and well-being of our communities. Our new CEO, Sunil (Sunny) Eappen, MD, has met with hundreds of community members across the region to understand more clearly where our current community needs are. Meeting those needs will take all of us coming together, building on our strengths and finding ways to overcome our shared challenges.
Allie Stickney serves as Chair of the UVM Health Network Board of Trustees and has more than three decades of nonprofit executive leadership experience at the state, national and international levels. She lives in Shelburne, Vermont.