Conflicts of Interest and George Washington University Medical School's Probation

In the Washington Post is this story of continuing troubles at George Washington University's medical school. The school is currently on academic probation, and despite previous protests to the contrary, its troubles are more than superficial.

When the medical school at George Washington University was put on academic probation last fall, school officials said the reasons were mostly superficial matters, such as problems with administrative paperwork and student complaints about a shortage of lounge space.

In fact, according to interviews and documents obtained by The Washington Post, the school had deficiencies that were considerably more serious.

According to a confidential evaluation document and interviews, GWU has done an inadequate job of monitoring students' time with patients and ensuring that those clinical experiences relate to classroom learning. Student debt levels are among the highest in the country, according to the seven-page letter sent by the accrediting agency in June and later obtained by The Post. Students complained of mistreatment. Problems flagged as long ago as 2001 still had not been addressed when the school was put on probation.

The George Washington University School of Medicine and Health Sciences is the only one of 129 medical schools in the United States on academic probation. In the past 15 years, only five schools, including GWU's, have been singled out for problems that the country's medical school accrediting agency concluded 'seriously compromised the quality of the medical education program.'

The article later provided more detail.

The committee cited inconsistent oversight of the clinical experiences in its letter to school officials. Not all the doctors who supervised students at another hospital had faculty appointments at GWU, so there was no guarantee they were reinforcing what students had learned in class. The committee noted pressure to see patients might affect the time doctors have for teaching and research.

Problems were allowed to linger. The accrediting committee noted in June, as it had in 2001, that the school still didn't have a system for monitoring student achievement and hadn't reviewed the curriculum to avoid gaps or redundancies.

Students complained of mistreatment at higher-than-average rates, according to the letter. Nationally, about 17 percent of students surveyed say they have experienced mistreatment, primarily belittlement and humiliation.

Accreditors noted a potential conflict at GWU because the ombudsman who handled student complaints also led the committee that evaluated students.

The Post reporter's analysis of the underlying problem at the school is striking:

Although it was not a factor in the decision to place GWU's medical school on probation, many people interviewed for this article also pointed to what they consider a potentially serious conflict of interest involving its top official. They said the conflict provided an incentive to keep the institution's focus on improving its hospital's bottom line rather than investing in medical education, research and training.

Since 1999, John F. Williams, GWU's provost and vice president for health affairs, also has received money and stock options for serving on the board of directors of Universal Health Services, which owns the university hospital.

Williams was paid nearly $680,000 in annual compensation by GWU, according to the university's 2006 tax returns, its most recent, and UHS reported in Securities and Exchange Commission filings that he received compensation from the company that calendar year of $122,000, including stock options.

Nonetheless, the position of the university's top leadership was that Dr Williams did not really have a conflict:

GWU leaders asked Williams to resign from the corporation board and this month accepted his resignation, effective by the end of the academic year. They said his position at both institutions could create the appearance of a conflict of interest.

'No information emerged to indicate an actual conflict of interest,' the university said in a statement.

So let's see... Dr Williams is on the board of directors of Universal Health Services Inc, a large for-profit hospital management company. As a director, he has a fiduciary duty to the company's stockholders to maximize its profits and its financial health. To compensate him for these responsibilities, he was most recently paid $122,000 yearly, and per the company's 2008 proxy statement, has amassed stockholdings of 10,525 shares (currently valued at $38.29 /share [per Google Finance today, 23 February, 2009], thus worth approximately $400,000.)

Universal Health Services Inc now owns and runs the GW Hospital. GWU presumably must negotiate with this teaching hospital, and hence with Universal Health Services Inc about matters that affect the medical school's educational programs. Improving those programs presumably might cost Universal Health Services more money. So the person simultaneously in charge of trying to increase services GW Hospital provides the school, which may cost the hospital and its parent company more, is also separately responsible for maximizing GW Hospital's and Universal Health Service Inc profits, presumably in part by reducing GW Hospital's costs. If that only results in the appearance of a conflict of interest, imagine what a real conflict of interest might look like. (And if the only problem was the appearance of a conflict of interest, why was Dr Williams forced to resign?)

The Post article featured the following discussion with US Senator Charles Grassley (R - Iowa), who has made a big effort to address conflicts of interest affecting academic medicine and health care in general:

'It's surprising that this relationship went on for many years,' Sen. Charles Grassley (R-Iowa), ranking member of the Senate Finance Committee, which has scrutinized salaries at nonprofit organizations like the medical school recently, said in a statement. Officials at nonprofit agencies are responsible for ensuring that their assets are used for the public good, while company leaders must maximize profit, he said. 'It would be very hard for one person to wear both hats and fairly serve both interests.'

It now seems a long time ago when we first discussed a new species of conflict of interest affecting top leaders of academic medicine and other health care organizations. This species of conflict was simultaneous service on the board of directors of a for-profit health care corporation, which entails fiduciary responsibilities to that corporation's stock holders to maximize profits and improve the corporation's finances, and service as leader of a health care organization which might need to negotiate at supposed arm's length with that corporation. We thought that this species of conflict might be quite prevalent, and quite important in its effects on health care organizations' abilities to carry out their missions. Yet for a while discussion of such conflicts seemed only to appear on Health Care Renewal.

Now the new species of conflict are reported in the Washington Post, and deplored by Senator Grassley. Furthermore, there is now at least anecdotal evidence that such conflicts can impede an academic medical institution's academic mission. Now that this problem is achieving some recognition, it may be time to dream about a solution.

Hat tip and see further discussion in the University Diaries.