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The Health Affairs Committee of the University of South Carolina Board of Trustees met on Wednesday, March 20, 2002, at 10:05 a.m. in the Board Room of the Carolina Plaza.
Members present were: Mr. Samuel R. Foster, II, Chairman; Mr. Robert N. McLellan; Mr. John C. von Lehe, Jr.; Mr. Othniel H. Wienges; and Mr. Herbert C. Adams, Board Vice Chairman. Members absent were: Mr. Arthur S. Bahnmuller; Mr. A. C. Fennell, III; Mr. J. DuPre Miller; and Mr. Mack I. Whittle, Jr., Board Chairman. Other Trustees present were: Mr. James Bradley; Dr. C. Edward Floyd; Mrs. Helen C. Harvey; Mr. Toney J. Lister; Ms. Darla D. Moore; and Mr. Michael J. Mungo.
Others present were: President John M. Palms; Secretary Thomas L. Stepp; Executive Vice President for Academic Affairs and Provost Jerome D. Odom; Vice President and Chief Operating Officer J. Lyles Glenn; Vice President for Information Technology and Chief Information Officer William F. Hogue; Vice President for Business and Finance Richard W. Kelly; Vice President for Student and Alumni Services Dennis A. Pruitt; Vice President for Human Resources Jane M. Jameson; Director for Human Resources Programs and Services Jeffery G. Cargile; Vice Provost and Executive Dean for Regional Campuses and Continuing Education Chris P. Plyler; General Counsel Walter (Terry) H. Parham; Budget Director, Office of Budget, William P. Bragdon; Vice President for Medical Affairs and Dean of the School of Medicine Larry R. Faulkner; Dean of The Norman J. Arnold School of Public Health Harris Pastides; Dean of the College of Nursing Mary Ann Parsons; Dean of the College of Pharmacy Farid Sadik; Dean of the College of Social Work Frank B. Raymond; Associate Dean for Research, School of Public Health, Russell Pate; Moore School of Business Professor Caroline Strobel; Moore School of Business Professor Daniel C. Feldman; Associate Professor of the College of Journalism and Mass Communications Sonya Duhé; Director for Salary Administration Judith Owens; Director of Public Affairs Russell McKinney; and Faculty Senate Representative Rob Wilcox.
Chairman Foster called the meeting to order and welcomed those present. Mr. McKinney introduced a member of the media who was in attendance.
Chairman Foster stated that the agenda had been posted and the press had been notified as required by the Freedom of Information Act; the agenda had been circulated to the Committee members; and a quorum was present to conduct business.
College of Health Sciences SDI Recommendation: Chairman Foster asked Dr. Odom to discuss the SDI recommendations regarding the College of Health Sciences. Dr. Odom noted that a number of meetings had been held individually with the deans and Dr. Odom had been impressed with their cooperative spirit in reviewing the proposal in a positive fashion. Dr. Odom stated that Dr. Russ Pate would provide a presentation to the Committee concerning the thought process that went into the recommendation.
Dr. Pate focused on the recommendations pertinent to the formation of a College of Health Sciences which would include five existing units - the School of Medicine, the School of Public Health, and the Colleges of Social Work, Pharmacy, and Nursing. Each unit would be named a school headed by a dean. A Vice President's position would be created and the deans would answer to the Vice President of Health Sciences who would report to the Provost. The new Vice President for Health Sciences would be charged with expanding the University's research funding from the National Institutes of Health (NIH), as well as encouraging the development of collaborative research activities with the Medical University of South Carolina and other institutions of higher education.
Combining the six basic biomedical science departments into a single department within the School of Medicine had also been recommended.
The SDI Committee had recommended that salaries for basic science faculty in the School of Medicine be funded from the allocated budget at a nine-month equivalent. It was expected that the faculty members would generate up to three months additional salary through extramural funding.
One of the two major objectives of the SDI recommendations had been to enhance the University's productivity in research; a hallmark indicator of that would be extramural funding for research. Dr. Pate displayed a chart of the recent history of extramural funding relative to the combined five health science colleges which would be affected by the recommendation. It included the total funding, research funding, and NIH funding for the fiscal years of 1999, 2000, and 2001. The SDI Committee had observed that it would be desirable for a larger fraction of extramural funding be for research, and of that fraction, a much larger component would come from NIH. Other charts shown outlined the contributions to the five individual schools and colleges from fiscal years 1999 through February, 2002 indicating total extramural awards, total research awards, and total NIH awards. The data for the current fiscal year for each had been encouraging with the exception of NIH funding, which had not increased over the last three fiscal years.
The National Institutes of Health had been an area of focus because most of the research money was available from there. This rapid and very substantial increase in the availability of research funding from the NIH had led the SDI Committee to believe that the University should focus on increasing funding from that agency.
The formation of the unit would also facilitate research collaboration with MUSC and other institutions within the state. In addition, the formation of the unit and the appointment of a vice president for health sciences to lead the effort would facilitate expansion of PhD programs in the health science areas, reduce instructional and other duplication across the units, and provide unified, visible leadership for USC's health science activities.
Mr. von Lehe inquired about combining the basic science departments. He noted that this had been criticized by the faculty. Dr. Pate responded that the academic departments in the School of Medicine had been generally clustered into two areas: the basic science units and the clinical science units. The basic science units had provided instruction and conducted research in the basic biomedical science areas such as pathology and anatomy. This recommendation by the SDI Committee had been consistent with several recommendations which the Committee had made that would apply to units across the campus. The general thought had been that there would be merit in reducing the number of smaller departmental units which existed for the purpose of making it somewhat easier for units to adapt to changing environments and demands. The term "nimble" had been used in Committee discussions. Having fewer and larger units would support adjusting a reallocation of resources within the units over a period of time.
Dr. Odom stated that discussions had taken place with Dean Faulkner and Dr. Palms. Dean Faulkner had made excellent strides toward reducing the six departments to three departments. Dean Faulkner noted that there had not been a standard way of organizing basic sciences in medical schools around the country. There had been no accreditation requirement for having a particular structure of the basic science divisions within a school of medicine. This had been an issue that a number of medical schools had been reviewing to more effectively deal with new research agendas.
Mr. Mungo inquired about the salaries being funding at a nine-month equivalent. Dr. Pate responded that the intention had been to increase the incentive for faculty in the basic science departments in the School of Medicine to pursue extramural funding to support their research.
Regarding an item referenced in a report from Mr. Wilcox which had been authored by the faculty senators from the School of Medicine, Mr. McLellan expressed concern about certain details being overlooked, specifically regarding the acceptance of approximately a dozen out-of-state students with scores significantly higher than the average South Carolina resident student entering medical school. Currently, getting South Carolinians in the medical school had been difficult; limiting the opportunity for qualified South Carolina individuals to attend the medical school because of the obligation of accepting 12 out-of-state students needed to be examined. Mr. McLellan noted that not all of the SDI recommendations had been seen; the salary issue was another example. Dr. Pate stated that the issue regarding out-of-state students had not been recommended by the SDI Committee. Ms. Moore acknowledged Mr. McLellan's concerns not only with respect to the medical school, but for the entire University, and noted that the details would come up at a later stage in the process. In response to Mr. McLellan's concern pertaining to out-of-state students, Dr. Odom stated that the SDI Report had only indicated an overall goal to increase the quality of the University's student body at the undergraduate and graduate levels. Mr. Wilcox interjected that the information from the faculty senators had been their evaluations of the recommendations which had been made. The general recommendation had been to increase the student body; however, the perspective of the senators and the understanding of the faculty from the School of Medicine had been that the action of going out of the state would be required to accomplish the goal.
Dr. Palms stated that all the comments and discussions that had been received from various individuals would be taken into consideration; a recommendation would be forthcoming from him. Further discussion on appropriate topics for adoption would then take place.
Dr. Floyd expressed several concerns such as clinically educating medical students, having a strong dean to negotiate with Palmetto Richland Hospital, and having medical students and faculty functioning at the Baptist Hospital. He further stated that other major issues existed and research funding should not necessitate a total change. Dr. Odom responded to Dr. Floyd's concerns stating that the SDI Report had not mentioned the clinical aspects of the Medical School because no wrong had been found; the educational and clinical parts had both been seen as functioning well. The research topic needed to be addressed and therein it was felt that changes could be made. Furthermore, working with Richland Hospital had been very important. The SDI Committee had discussed the issue and had recommended that the Vice President for Health Affairs report to the Provost. Dr. Odom noted that there would not a problem with the Vice President reporting directly to the President, if that would make a difference. Dr. Palms noted that learning from the clinical applications, but transforming that into research had been what an educational institution should do. In a university setting, research was primary and tied to the practice. Research should be balanced to make progress in the type of care to be delivered in a clinical manner. Dr. Floyd agreed with Dr. Palms' comments.
Dr. Pate commented that the SDI Committee would have agreed with Dr. Floyd's analysis. The quality of instruction in the School of Medicine and other health science schools had been excellent; however, it was possible, appropriate and important for the faculty in the units to work toward enhancing research productivity with the proper types of coordination. Concerning faculty capacities in the health science units, Dr. Pate stated that research productivity could be improved by enhancing the productivity of the schools at essentially their existing size and/or by increasing the capacity by adding faculty. While considerable enhancement of research productivity had been possible with the existing capacity, the capacity was limited. Eventually, the University would need to review an expanded capacity in the health science area if growth in the level of NIH and other public health service funding was expected.
Chairman Foster reminded the Committee that the purpose of this meeting had been to receive the recommendation of the SDI Committee about the formation of a College of Health Sciences and general discussion in a global perspective regarding the topic. He noted that there had been a number of comments regarding the details which would come up about this topic.
Mrs. Harvey inquired about the costs involved with the formation of the College of Health Sciences. Dr. Pate responded that the creation of the Vice President's position for Health Sciences would involve costs. Aside from that, if the action succeeded as anticipated, substantial funds would be generated. For example, if the University were to increase its NIH funding by $50 million, approximately $15 million would be in indirect cost recovery which would be returned to the University.
Mr. McLellan requested clarification regarding the nine-month salary appointments versus the twelve-month salary appointments, as outlined in the senate report, which referenced that 115 of the 125 medical schools in the United States had appointed faculty on a twelve-month basis. Additionally, going to a nine-month basis would act as a deterrent in attracting additional faculty. Dr. Odom advised that twelve-month appointments had not presented a problem; the Committee did not want to provide twelve months of salary for individuals. The statement in the senate report had not addressed the amount of hard money for the appointments. Dr. Odom advised that appointing individuals on a twelve-month basis, but advising that 25% of the salary had to be generated would not be a problem. The Medical University of South Carolina had paid their faculty a percentage of salaries which consisted of no more than nine months in hard appropriated dollars; in many cases the amount had been less. Dr. Odom stated that USC's purpose for the nine-month appointments had been to free up money so that the size of the research enterprise could be increased in the medical school. Ms. Moore commented that high quality individuals would want incentive compensation. The recommendation would promote a better medical school, would provide a more streamlined organization and management, and would set the groundwork to bring higher quality professionals into the organization. Dr. Pate opined that while the incentive issue had been discussed in the context of the School of Medicine, the principle applied across the board at the University.
Ms. Moore inquired about the strategy which could be utilized to move up from the bottom of the list for NIH support. Dr. Pate stated that moving up to the middle section on the list would not be an easy task because of the tremendous capacity difference between the University's current status and the status of other institutions which were considerably larger in the health sciences area. However, adjustments could be made which would have the desired affect of moving the University in the right direction including the incentive issue as well as better coordination and leveraging of existing resources. The University had never received a program project grant from NIH. These large, multi-study investigations were usually accompanied with very large budgets. If the University were to compete at that level, drawing on existing strengths across the University and within the health science units would be a way to accomplish the goal for the purpose of developing applications to compete for large grants.
Ms. Moore commented on the study of comparative advantage pertaining to the unique health issues within the state of South Carolina and noted that those areas should be focused upon. Dr. Pate stated that the health status of South Carolinians had been an enormous resource from the standpoint of conducting research which focused on health disparities across racial, ethnic, and social economic groups. The types of research which would address those issues had currently been a high priority in the public health service areas.
Dr. Faulkner commented that one of his concerns about the SDI Report had been that in some ways it minimized the challenge which lay ahead of the University. As an example, millions of dollars had been pumped into the infrastructure for the biomedical research enterprise at the University of Washington. This would also be necessary for USC, but could not be handled from South Carolina only; federal assistance would be needed as well. To compliment the SDI Report, a very specific, strategic approach would be required to accomplish the task. This would be multi-faceted and should include elements such as a political strategy and financial incentives both internal and external to the University. As an example, the USC School of Medicine had approximately 225 faculty members; the University of Washington had roughly 1,500 faculty members doing research; hundreds of millions of dollars had been brought in. USC had developed solid clinical, service, and education programs in the health science area; the infrastructure to develop the type of research enterprise had been inadequate. Dr. Faulkner noted that to get to the next level, a significant infusion of resources, labs, equipment, and faculty would be required, along with a strategy for accomplishment.
Discussion ensued among Committee members concerning university hospitals at other universities. Dr. Faulkner noted that having a university hospital no longer provided a source for additional revenue to support an academic enterprise as it had in the past. To count on a method such as that in the future would be problematic. It would be very difficult for USC to get to where it wanted to go given the current structure. A huge biomedical research enterprise would be needed, but would probably not be attained unless a major change happened in the structure, function, and organization of the system. USC needed to recognize existing areas and to capitalize and make progress in those areas.
Mr. Mungo inquired about the economic benefits of a research institute and the percentage of research dollars which would be returned to the local economy. Dr. Odom remarked that generally four dollars would be generated in the economy for every dollar brought in for research.
Concerning the School of Public Health, Dr. Pastides stated that in 1998 the state appropriated budget had been approximately $6 million dollars and the external funding had been roughly $7 million dollars. Currently state appropriations were a little higher because of inflation. However, sponsored programs would be approximately $18 million this year. The reality of federal funding was that health would become a booming business. Policies related to hiring faculty, not on a tenure track, had been invoked and incentives had been created whereby faculty could earn more money by virtue of the indirect cost recovery which had come into the units. Collaborative work had increased between all of the health sciences colleges. However, more money and an increased infrastructure would be required. A reorganized and a more comprehensive attitude would be needed enabling the University to be more effective in Washington and at the State House.
Dean Parsons commented on the contributions of nursing; there were 16 tenure-track faculty in the College of Nursing. The faculty had been very productive, but a maximum had been reached in terms of what the faculty could do and larger grants were desired. Dean Parsons stated that the College of Nursing had been excited about the possibility of coming together as a division because of the leveraging aspect with colleagues in the other colleges and schools; growth would continue primarily with collaboration. It had been hoped that support would exist for the vice president, perhaps reporting to the President, by providing attention and authority to accomplish the tasks ahead. Cost savings could be seen, but in terms of division, it was expected that resources would need to be put into this endeavor.
Mr. Kelly followed up on Ms. Moore's earlier inquiry concerning the structure of federal grants. Currently, based on funded research, the University had received approximately $12 million in indirect costs; 50 percent would go to the department and 50 percent would remain at the University. At the Joint Boards Retreat held in February, Dr. Odom discussed taking 7 percent from each side and creating a fund to build research facilities. Approximately 44 percent of the money which comes to the University was attributable for indirect cost. A million dollars worth of additional research grants, excluding equipment, would denote approximately half a million dollars to the campus for indirect cost. Dr. Odom stated that a recommendation was made to reallocate indirect cost recovery; 14 cents of every dollar, if put into a capital fund, would generate approximately $800,000 per year, which would finance about $12 million.
Chairman Foster stated that unique health issues existed within the state allowing the University an opportunity to leverage NIH funds. No decisions would be made at the present time; the general consensus to form the College of Health Sciences would be conveyed to the President for further analysis by him. The details would be considered and brought out over the next several weeks, as the President prepared a recommendation to the Board. Dr. Palms commented that he would welcome communication from any member of the Board.
Mrs. Harvey requested a cost estimate pertaining to the formation of a College of Health Sciences prior to the time of making a decision on the issue. Chairman Foster additionally requested a report indicating the reinvestment of dollars, if the merging of departments brought about a cost savings.
There was no further discussion and Chairman Foster declared the meeting adjourned at 11:25 a.m.
Respectfully submitted,
Thomas L. Stepp
Secretary