The KMSF Propaganda Campaign

9/7/2016

Once again, for those new to this blog site, at present there are 26 posts on the blog and each has its own set of comments. To read the comments you have to hit the word "Comments" at the beginning or end of the post. Somewhat confusing is that when you bring up the comments for a specific post it eliminates the other posts from the screen. To bring the other posts back up simply go back to the top of the page and click on Blog. Finally, to understand the development of the blog it is best to read it from the bottom post (Dr. Paul Kearney Case) up. One point of note here, to read the earliest posts you have to click on the word "<<Previous" at the very bottom of the posts available.

Getting back on topic, the word around town is that they need to make this negative KMSF/University of Kentucky publicity “Go Away”. Clearly the new approach is not to obey the open records laws, is not to accept the decisions of the state’s Attorney General’s office and is not to become a truly transparent and aboveboard company that is part of the University of Kentucky. The new approach is simply a propaganda campaign that is designed to draw attention away from the issues of transparency with respect to what they are doing with the revenue generated by the physician faculty working in this public university hospital. In case any of you outside the university reading this blog are unaware, what I am referring to here is the recent onslaught of 3 propaganda Lexington Herald Leader editorial articles submitted by 2 KMSF board members (one being the current president of KMSF, and both of course are university College of Medicine faculty members) and by a retired KMSF employee:

http://www.kentucky.com/opinion/op-ed/article98189362.html
http://www.kentucky.com/opinion/op-ed/article99688042.html
http://www.kentucky.com/opinion/op-ed/article99689932.html

that were written in response to this front page Herald Leader article entitled, “How the secretive arm of UK Healthcare spends $200 million a year”.

http://www.kentucky.com/news/local/education/article96631937.html

All these propaganda editorial articles praise the accomplishments of KMSF and claim it is an open and aboveboard organization. They claim to have no secrets but want you to trust them in this regard. Of course none of this would have been necessary if KMSF would have not started suing people for requesting open records that might provide information on what KMSF is doing with all of the money this public university nonprofit hospital is making. The bottom line for me is, if KMSF is doing nothing but good things with this money, why is KMSF willing to break the law to prevent people from knowing about these great things?

Once again, KMSF was created by the University of Kentucky, is run by the faculty and staff of this public university and the revenue generated by this public university hospital belongs to this public university and not KMSF. If KMSF is unwilling to accept the fact that it is part of this university and therefore must obey the laws that relate to a public university, one very reasonable solution is to simply stop doing business with KMSF and form our own medical services foundation. Call it “University of Kentucky Medical Services Foundation” if you will, or simply UKMSF. I feel certain we currently have the experienced personnel to do this, or we would shortly after they no longer had jobs with KMSF.

18 Comments

Sara

9/7/2016 04:14:08 pm

What a bunch of BS. KMSF executives telling us about all of the good things they are doing with our money. I would be willing to bet that Peggy Halcomb didn't even write her article, but rather signed off on something they gave her. I mean she states she has been an employee of KMSF for 40 years, which is a pretty good trick since KMSF was founded in 1978. This might explain some of the mathematical errors coming out of this place.

Beshear Andy

9/7/2016 05:02:03 pm

Great quotes. Keep up the good fight.

http://www.kentucky.com/news/local/education/article100359972.html

Dan Noonan

9/8/2016 02:52:47 am

Thanks Sara and Beshear Andy for your comments. Like you Sara, it appears to me that KMSF is simply throwing up a smoke screen to distract from the central issues of their upcoming court battles, that will in essence be funded through hospital/university revenue. When or if the truth ever comes out, I feel certain we will find out that it is "all about the money".

Beshear Andy, it appears that the university dark side simply can't keep out of the newspaper lately. I would be interested in knowing which of these president Capilouto is more worried about: the KMSF headlines, the university suing its own student newspaper for exposing one of its faculty members as a sexual harasser and the administrations attempt to cover this up, or the 44-35 football team loss to that powerhouse Southern Miss?

9/8/2016 07:57:12 am

Can we next expect to see editorials from UK college deans stating how great and safe it is to be in their college and that everything they do and everything the university president does is in the best interests of the students attending UK? Maybe they could add something like, "don't believe everything you read in the school newspaper or may hear from a few disenchanted fellow students, they don't represent the majority".

9/8/2016 09:40:45 am

Thanks BJ for the comment.

Dave

9/8/2016 11:28:40 am

I think it's becoming contagious

http://www.kentucky.com/news/politics-government/article100236747.html

Tony Harrison

9/8/2016 12:09:28 pm

Could someone go through the Randall article and identify which of the statements in it are known to be untrue? For example, the H-L article and a lot of the postings here say that KMSF makes $200M "profit" but the Randall article says that all but 8% of this is spent on physician salaries. Is that a lie?

For Real

9/8/2016 06:51:35 pm

Until the KMSF opens their books we have to rely on publicly reported data:

Financial Statistics
Gross Patient Revenue $3,914,251,069
Non-Patient Revenue $296,774,803
Total Revenue $4,211,025,872
Net Income (or Loss) $192,033,000

https://www.ahd.com/free_profile.php?hcfa_id=cddd343d7bfb79150a3be9d7fc8f58ea&ek=a73d15db1e099a65a31ebb415c3b7809

9/8/2016 02:35:35 pm

Thanks Dave and Tony for the comments. Dave, at least he is not still heading the BoT.

Tony, I don't think anyone reading the blog can provide a documented answer for that question, because it is currently one of those "trust me" items, resulting from KMSF's continued refusal to obey open records laws and the state's Attorney General.

9/9/2016 02:57:30 am

Does this help?

http://kmsf.fusiondev.co/files/2016-06/2015-issued-financial-statements.pdf

This has details of expenses, not just income.

9/9/2016 08:44:26 am

Thanks Tony for this comment. These audits are nice but only globally look at the money coming in and going out of the hospital. I think what folks are looking for in the open records request is more in the minutia of what is being done with these millions of dollars coming in and going out. This was central to the internal audit made by Dan Ross in the UK auditing department a few years back wherein he identified a misuse of hospital revenue by KMSF. Ross reported this to his boss who refused to do anything about it, he then challenged that decision and was subsequently fired for insubordination. He filed a Whistleblower suit that was conveniently settled out of court. Many believe this was about the time that KMSF realized that they had to do something about preventing these types of disclosures, and initiated this campaign to isolate themselves and this public university's money (keeping in mind KMSF is a nonprofit agency) from the university and its auditors. I would make a guess that Dean Dorton Allen Ford, PLLC has no idea what KMSF is allowed and not allowed to do with this money, and therefore would never pick up on any potential misuse of the money.

In looking at the 192 million dollar profit one might fathom why the "hospital administration" might be interested in isolating these profits away from the university. That is because KMSF is the "hospital administration". As we stated previously, the KMSF Board of Directors is composed of chairs and division heads from the College of Medicine departments and divisions associated with clinical care. In spite of that KMSF is declaring itself as not part of this university. Unfortunately for KMSF the Attorney General is not buying this argument. Thus we are back to the situation of our state university hospital revenue being used to pay lawyers to fight a battle to keep secret what the administration of this hospital has done and is doing with this state university hospital revenue.

9/9/2016 09:02:03 am

The net income is not the same as "profit". Of course I appreciate that you all want to see the details at a granular level but their published accounts at the link I posted above and the Randall article imply that this is used to pay salaries/operating expenses. Admittedly these are only listed as "departmental expenses" in their published accounts. It would be a shame if after all of this fuss there wasn't anything interesting to be revealed..

9/9/2016 11:00:58 am

Thanks for the comment Tony. Interestingly, in looking over the public audit you provided, it appears, at least to my naïve accounting abilities anyway, that in 2015 after all expenses (including the ~72 million dollars for physician supplemental payments) the hospital only came out ahead by $33,509,446.00. This may not be much to some, but it’s surely not chump change.

Anyway, the real concern is not “revealing interesting misuses of hospital revenue by KMSF”, but rather the simple fact that this is University of Kentucky revenue and the University of Kentucky is subject to laws that, whether folks like it or not, require transparency. If anyone at UK hospital is unhappy with this and wish to work or administrate at a hospital that is not subject to these laws, there are at least 2 other hospitals in town where that is possible.

Finally, I should also point out there is a pretty strong precedent for KMSF misuse of funds, and therefore a good reason for this transparency requirement. We have discussed this before, but I will reiterate it for any new blog readers unfamiliar with it. Part of the reason Dan Ross was fired for insubordination was because he pressed the issue that KMSF used hospital revenue as matching funds in the state’s Research Challenge Trust Fund (RCTF) program. This was a state initiative to promote research in the universities and colleges of Kentucky. The basic tenet of the program was that the state would match contributions from non-affiliated sources. The College of Medicine and hospital administrations decided they could take advantage of this system by using KMSF revenue as their non-affiliated source. Unfortunately, as Dan Ross knew and the Attorney General has declared, this is not the case. The RCTF program was an excellent program and several junior faculty from my former department benefited from it. This has nothing to do with the integrity of the RCTF program or perhaps even the possible underlying motivation to help junior faculty in this instance. What it negatively reflects on is the integrity of the administrative body making these decisions at KMSF and the university hospital. The RCTF was a limited pot of state money vied for by all of the colleges and universities in this state, and the administrators making these decisions decided they did not have to play by the same set of rules as the other state universities and colleges. These actions, most probably by a few select upper administrators in the hospital and KMSF, suggest a tendency to bend if not break the rules with respect to what can and can’t be done with the revenue generated by this public university hospital. Therefore, one would hope that the University administration would not only wish but also require transparency, accountability and openness with respect to what KMSF is doing with this public university revenue. Unfortunately that does not appear to be the case.

9/9/2016 11:38:14 am

I think I remember you making these points before. I bet that the eventual outcome of all this is that "the law" is changed so that some aspects of the business operations of UKHC/KMSF and possibly also UK's personnel operations become exempt from the open records statutes by changing UK's designation as a completely governmental or public agency. I think UK's defiance of the open records rulings and the lawsuits are all about achieving this change (and not about the actual substance of the rulings/information being requested).

9/9/2016 01:25:21 pm

Thanks for the comment Tony. It will be interesting to see how this all pans out. It appears to be a battle of lawyers at present. I guess some might be asking, "where did our BoT disappear to?"

Rosie

9/9/2016 06:08:25 pm

I kind of like the comment in the previous post that suggested KMSF be transformed into UKMSF. If there is nothing to hide why not simply make the financial management division of the UK hospital part of the hospital. In essence it really already is, with the exception that they don't want anybody to know it. HIPPA overrides any access to patient data, so what's left? Are we worried about our salary and benefits data? I think that should be out there anyway, because it can only help us in recruiting and competition with the private hospitals. Are we worried about our strategic plan? I mean we have the most comprehensive healthcare system in the city, so what are we worried about. Can't we simply work together? Is it our goal to run every other hospital in this city out of business? Is that our strategy? What a horrible strategy.

9/10/2016 02:14:15 am

Thanks Rosie for this comment. I like the idea also, but don't hold out much hope that this will ever happen, especially with the current leadership at the university and hospital.

Da Illest

9/10/2016 05:33:13 am

Huge developments here. I think this is worthy of a new post.

Capliuto is a coward and things are seemingly starting to unwind for the board of trustees.

http://www.kentucky.com/news/local/education/article100919697.html

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The KMSF Propaganda Campaign

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