Finance and Administration - Board of Trustees - The University of ...

Finance and Administration Committee - III. Minutes of Last Meeting1Commission a cost for resident malpractice coverage. Residents are notcovered via some third party malpractice.He then presented the crux of his presentation. He showed the fundingformula for 2011 at Erlanger. They spent about $24.8 million and the moneywas broken down as follows:Resident Compensation and Malpractice - $12.3 MillionGME Program Administration - $2.1 MillionFaculty/Program Support - $5.3 MillionLeased Faculty (PSA) - $5.1 MillionThey are paying the leased faculty Physician Services Agreement thatChancellor Schwab spoke of earlier. They are paying that in two differentstrategies but the Erlanger Hospital was in control of it. Literally, the Dean inChattanooga has to go back to the Erlanger Hospital for everything that needsto be spent. He has to ask their permission or ask for incremental resources.Without putting the Erlanger Hospital in the situation of asking them to comeup with $7.3 million in new money – we restructure the financing scheme andhave now gone away from the Physician Services Agreement. The fact thatthe Practice Plan will be this entity that exists as part of Erlanger Hospital –we have now created a support payment that the Hospital pays directly to theDean of the College of Medicine. The $7.3 million, while it is not newexpenditures by the Hospital it is being spent in a different way. The Dean ofthe Practice Plan will have the latitude to spend that money as he sees fit torecruit additions for the Practice Plan and the College of Medicine. Again, insupport of the clinical mission of Erlanger Hospital System. We see this as amajor step for us. The Practice Plan will be comprised of all Universityfaculty initially. The plan is to start to bring in practice groups and get themconverted over to University faculty. It is our hope and expectation that thePractice Plan at Erlanger/Chattanooga will grow over the next three to fiveyears. Trustee Hall commented that the same outside consultant did a studyfor the medical unit at Chattanooga and made the same recommendation.Again, that is what is being followed and he thanked Trustee Foy who spent agreat deal of time also working through this with the Board of Trustees atErlanger Hospital. He said that he believed it would raise the profile of ourmedical unit at Chattanooga that we have quite an investment in and shouldbe a win/win for both the Erlanger System as well as the presence of the UTMedical Center in Chattanooga. Most importantly, there won’t be anyquestion that the UT colors in regard to this will be orange and Vice PresidentDye will be able to make sure all of the letterhead is UT orange without anycontroversy. Vice Chancellor stated that to that point, we are in the processof developing a real marketing strategy where the Hospital will be co-2325