Emory Report
September 10, 2007
Volume 60, Number 3

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September 10, 2007
Medical schools are overlooked keys to Grady puzzle

Thomas J. Lawley, Dean, Emory University School of Medicine
Eve J. Higginbotham, Dean, Morehouse School of Medicine

Speaking as educators, we learned a few lessons from the recent summit meeting and ensuing community conversations on the future of Grady Health System. One of the most revealing was the relative lack of understanding about the critical roles played at Grady by the faculty physicians and residents (house staff) of the Emory University and Morehouse Schools of Medicine.

Under decades-long contracts with the Fulton-DeKalb Hospital Authority, Emory and Morehouse supply the entire medical staff of Grady Memorial Hospital. These doctors are in the trenches at Grady 24-7, providing all of the world-class medical care in the ER, trauma surgery, HIV/AIDS and infectious diseases, mental health, burn, stroke, poison control, sickle cell anemia, hypertension, diabetes, and dozens of other areas that we read about in the papers and see featured on TV.

When you read the phrase “Grady doctor” do a silent translation — because those words really mean either “Emory doctor” or “Morehouse doctor.” These physicians are truly dedicated providers, who wish to continue to provide compassionate, quality care, but need the institution to remain financially stable and keep its doors open.

For years, we at Emory and Morehouse have paid our doctors, all of them, in a timely fashion — despite not being reimbursed in the time frame required by our contract with the Hospital Authority. We have done this in good faith, always assuming Grady would return to a position in which it would meet its obligations to us in a timely fashion. Increasingly, in recent years, this has not only failed to happen; it has become much worse. The only reason Grady is open today is that both institutions have not aggressively pursued payment for services, at a great fiscal cost to our respective schools.

As of the end of August, both schools are owed, jointly, about $54 million by Grady for services already rendered by our doctors. This is money we have advanced from our private schools of medicine to this venerable public institution. It is money we are owed pursuant to contract with the Fulton-DeKalb Hospital Authority.

Every independent study or audit that has been commissioned by the Hospital Authority has affirmed the compliance with the contract by the medical schools, and has acknowledged the repeated failure of Grady to make payments to us in a timely fashion. We would be delighted for all such studies to be made public by Grady.

It should be obvious to everyone that such an ocean of red ink is not sustainable. We cannot continue to do business that way. Everyone who cares about the future of Grady should reflect carefully on what the medical schools mean to Grady, both in terms of providing doctors to staff the hospital’s unequalled medical centers of excellence, and in terms of our substantial contributions to the bottom line.

Not only do the Emory and Morehouse physicians generate all of the revenue from health care that comes to Grady; the fact that Grady is a teaching hospital, with a substantial number of residents on staff under the supervision of faculty physicians, means that Grady qualifies for a very significant infusion of federal and state funds each year for graduate medical education.

In this way, the teaching programs of the Emory and Morehouse medical schools continue to provide the citizens of Fulton, DeKalb and North Georgia some of the best medical care in the country at a highly discounted price. Were Grady to try to purchase this care on the open market, it would have had to close its doors years ago. It can’t be done — the dollars are not to be had.

Unfortunately, like many of the hospital’s other vendors, we are now reaching the end of our rope. In the past five years, the average size of the “accounts receivable” balance we are carrying from Grady has doubled, and the average length of payment has stretched as long as nine months.

The time for study and delay, fault-finding and finger-pointing, has long passed. Grady has no greater friends, nor any more committed allies and partners, than the two medical schools. No other entities have a greater stake in seeing Grady regain its footing and become financially viable for the long haul. But time is of the essence. Weeks are critical.

The transformation of the governance of the Grady Health System recommended by the Greater Grady Task Force can be accomplished quickly and offers the prospect of setting Grady on a new footing, with new business models and new support from several levels of government.

The situation at Grady is sufficiently acute that the rescue must begin immediately to be successful — and it must deeply involve the Emory and Morehouse doctors who are most knowledgeable about the history, symptoms and potential cure of this critically important, but gravely distressed, institution.

A version of this essay appeared in the Sept. 3 edition of the Atlanta Journal-Constitution.