by Hamilton E. Davis
A few weeks ago, Sunny Eappen, the newly minted CEO of the UVM Health Network, gave his first public interview to Stewart Ledbetter, the veteran anchor of WPTZ, Channel Five. Since he took office in December, Eappen has been introducing himself around the Network, getting used to his new organization and learning a new medical and political landscape. The Channel Five appearance was his first public performance while actually holding the wheel.
Ledbetter eased Eappen into the session, asking him where he is from (Chicago) and suggesting he must be getting used to riding the Lake Champlain ferries, which you have to do if you’re overseeing not just the three Network hospitals in Vermont, but the three in northeastern New York. Eappen allowed as how he was, getting to see the facilities and meeting the top people in his organization.
“So, three, four months into the job, is it about what you expected?" Ledbetter wanted to know.
It is, it is, Eappen replied. I think the financial situation has been difficult, but not unexpected. It’s the way it is across the country, around the challenges that all hospitals are having. What’s been a fantastic…even better than expected surprise has been how great the people have been, that is our staff, our caregivers are completely committed to our patients. Our leadership is committed to our communities. That’s been incredible and incredibly positive.
That sounded pretty routine, an acceptably platitudinous answer to a soft-ball question. In fact, it was totally contrary to the facts on the ground. It is true that hospitals around the country were hammered both medically and financially by the Covid virus.
But no delivery system in the United States has been driven as close to the rocks as the UVM Network has been by its regulator, the Green Mountain Care Board. Over the last seven years, the Board has wrung every nickel it could out of the Network’s budget requests, despite UVM’s demonstrably high quality and country-leading cost efficiency. A key result is that the Network’s Days Cash on Hand metric is no longer investment grade, although the rating companies haven’t downgraded them—yet.
The GMCB’s performance has been both irresponsible and incompetent, as I have written in this space ad-I-hope-not-quite-nauseum. Yet here was Eappen giving the Board the perfect cover: Hey, nothing unusual here, it’s happening to hospitals everywhere.
And it went downhill from there. In his understated style, Ledbetter stuck Eappen’s nose in every issue that has driven the crown jewel of the Vermont delivery system into a financial corner. Let’s watch it happen:
Ledbetter. In the pandemic, we heard about you having to pay the nurses more and you did. How many vacancies do you have? Have you turned the corner there?
I don’t feel we’ve quite turned the corner…we’ve made a lot of progress. We have hired more than we ever have before. The challenge remains that the number of people…nurses, doctors and other caregivers, has really changed here and across the country. So this is a challenge that is going to exist with us the next five, 10 years. And we’re going to have to come up with different ways to deliver that care. And it can’t be with a temporary workforce because it is just too expensive …
Well, the latter is certainly true; paying traveling nurses six figure annual salaries is not sustainable, and Sunny’s idea that the problem is going to take “five to ten years” to solve is simply ridiculous. The UVM Network has two years, possibly three years to right their financial ship. In five let alone 10 years on the current trajectory Vermont won’t have a national class academic medical center. Plus, Eappen went on to contradict his claim that a “lot of progress has been made.”
Ledbetter. Have you cut your travelers’ expenses significantly?
No, no. Compared to a year ago we’re probably 10 percent below where we were. So, we still have a lot of work to do on that front.
Throughout this conversation, Eappen seemed simply unaware that the underlying problem facing his organization is that it simply doesn’t have enough money to function properly, and that the reason is basically political, not whether the UVM Network is somehow flawed. What all the focus on the Network problems does is to deflect attention from what a mess the other 11 hospitals in the Non-Network are, and how petrified the Green Mountain Board is of getting political blowback by even talking about it…
Ledbetter keeps boring in. There’s news of a divorce between the UVM Network, and United Health Care, a national insurance company, that is refusing to contract with you because you’re too expensive. “They say that after receiving a nearly 20 percent in reimbursement rates over the last three years, UVM is now proposing a 15 percent price increase in one year and folks can’t afford that.
They’re correct. We were proposing 15 percent. As you know, we’re pretty regulated here in our state. So we can’t typically ask for anything more than the Green Mountain Care Board will approve…Eappen goes on to protest that UVM has one of the lowest cost networks in the country. We don’t think that we’re more expensive….
Those few sentences cast a shadow over the future of the academic Medical Center. I know that risks being overdramatic. But think about it. The Eappen position isn’t just weak, it is pathetic. The proposition that the UVM Network can’t even ask for what it needs, but rather what it guesses the Board might approve isn’t just ridiculous—it is legally, medically, financially, fiducially, and just plain-common- sense irresponsible. If the Network accepts even one more inadequate budget next summer and fall, it might never recover.
And it doesn’t have to. It should appeal an irresponsible Board-imposed budget to the Vermont Supreme Court, and at least let someone weigh in on the side of preserving the most medically and economically important asset that Vermont possesses and is in the process of losing.
Furthermore, there is abundant evidence to support its case. The evidence sits in the hundreds of pages of reports from a half dozen national consultants sleeping in the Green Mountain Care Board’s archives. Which everybody, including the Board, the Press, and the UVM Medical Center’s senior management ignores. Just like Sunny has demonstrated here. He asserts that the Network compares favorably nationally, and he drives that home by saying, “We don’t think we’re that expensive.”
What he conspicuously fails to do is to cite any specific evidence to support his case.
Of course, Sunny has only been in the job for four months, so it seems fair to ask, what about the rest of the senior management team and the Network Board who have been on the field for the last several years.
I’ll look at their performance in my next post.