LouisianaVoice has obtained a copy of the minutes of a meeting in Baton Rouge a little over a year ago which led to the firing of the head of the LSU Hospital System and the CEO of Interim Louisiana Public Hospital in New Orleans by the Jindal administration.
LSU Health Care System head Dr. Fred Cerise and Interim Louisiana Public Hospital CEO Dr. Roxanne Townsend were fired just days apart last year—Cerise in late August and Townsend in early September—following a July 17 meeting at which former Secretary of Health and Hospitals (DHH) Alan Levine pitched a plan to privatize the state’s system of LSU medical centers.
Levine was at the meeting on behalf of is firm, Health Management Associates (HMA) but was recently hired as president and CEO of Mountain States Health Alliance.
Present at that meeting, besides Cerise, Townsend and Levine were then-LSU President William Jenkins, DHH then-Secretary Bruce Greenstein, LSU Medical Center Shreveport Director Dr. Robert Barish, HMA CFO Kerry Curry, LSU Health Science Center Shreveport Vice Chancellor Hugh Mighty and LSU Board of Supervisors members Rolfe McCollister, Bobby Yarborough, John George and Scott Ballard. LSU Health Science Center New Orleans Chancellor Larry Hollier and Vice Chancellor for Clinical Affairs at LSU Health Sciences Center New Orleans Frank Opelka also participated by teleconference.
Opelka was promoted to Cerise’s position when Cerise was replaced.
The meeting was held in the LSU president’s conference room.
Both Cerise and Townsend expressed reservations about Levine’s proposal but several members of the LSU Board of Supervisors who were present at the meeting “indicated they want LSU’s management to pursue this strategy,” according to a summary of the meeting prepared for Jenkins by Cerise prior to his being replaced by Opelka.
Along with his two-page summation of the meeting, Cerise also submitted a third page containing a list of five concerns he had with the privatization plan pitched by Levine. It was that list that list of concerns which most likely got Cerise removed as head of the LSU Health System via an email from Jenkins.
HMA, headquartered in Naples, Florida, was the subject of a scathing report by CBS news magazine 60 Minutes less than six months after Levine and Curry met with LSU officials in Baton Rouge and Levine has since moved on to become the CEO of Mountain States Health Alliance.
The thrust of the 60 Minutes story which aired last Dec. 2, was that profits, not patient care, was the driving force behind HMA’s emergency room decisions and that emergency room doctors were pressured to admit emergency room patients “regardless of medical need” to boost the company’s bottom line.
Some speculation had HMA squarely in the mix insofar as the proposed privatization of LSU’s 10-hospital system but the 60 Minutes story apparently thwarted those plans.
Levine denied that in an interview with the Baton Rouge Advocate last October. “I have had no conversations with LSU about taking over any of the existing LSU hospitals,” he told the paper. “I was there (in Baton Rouge) as a former (DHH) secretary. I was not there to pitch my company.”
Little more than a month later, following the 60 Minutes story by CBS correspondent Steve Kroft, Levine found himself trying to salvage the HMA image.
HMA, which owns 70 hospitals in 15 states, was accused on camera by several former employees of setting admission targets and that doctors were coerced into admitting more patients. The former employees said doctors who did not meet quotas were threatened with their jobs.
Despite Levine’s denials that HMA was interested in managing the LSU hospitals, Jenkins seemed to think otherwise. “I would say he would be interested in business,” Jenkins said in the same story containing Levine’s denial. “You would be surprised how many companies across the country are interested in these hospitals.
Levine, according to Cerise’s notes, recommended as an initial step that LSU sell its hospital in Shreveport (LSU Medical Center) and use the proceeds to “offset budget cuts for the rest of the LSU system.”
He suggested that the buyers would form a joint venture with LSU, invest capital into the facility and develop a strategy for LSU “to more aggressively compete in the hospital market.”
“The LSU board members present indicated they want LSU’s management to pursue this strategy,” Cerise’s notes said. “Greenstein stated that LSU should look to generate two years of funding to address the state funds shortfall in the system through the sale of Shreveport’s hospital.”
It was at that point that Cerise indicated his concern that such a strategy would take time to develop and that LSU would likely need to go through a competitive public procurement process and “likely legislative approvals.”
It was subsequently determined that legislative approval was not legally required; all that was required was for the legislature to be informed of the administration’s actions.
“There appeared to be agreement that LSU develop a plan that would not result in closure of hospitals,” Cerise’s notes said. “When the question was posed to the group, ‘Will LSU close hospitals,” George responded, ‘We hope not.’ The clear message was that the board members did not want LSU to proceed with any hospital closures at this point.”
Since that meeting, Earl K. Long Medical Center in Baton Rouge and W.O. Moss Medical Center in Lake Charles have each closed.
“Cerise asked Greenstein if he would allow LSU to draw federal funds to try to fix part of our problem and he replied, ‘Yes.’”
Among the concerns expressed by Cerise in an addendum to the meeting meetings which he addressed to Jenkins:
- There is no commitment by DHH to mitigate the budget reduction while we work on the very complex Shreveport deal. Therefore, if later in the year, we realize that w cannot close a Shreveport sale by year end, we will run a deficit which is against the law and grounds for removal of those causing the deficit;
- There will be a significant community/political reaction to LSU assuming a competitive posture with a profit partner while receiving favorable Medicaid and uninsured financing from the state;
- We could see a significant negative community reaction to a plan that sells the Shreveport hospital and spends a large amount of the proceeds on hospitals in south Louisiana. There are also local contractual relationships which might be adversely affected and objected to;
- We need to be transparent with the legislature. If our plan is to spend as if we will complete a “joint venture” and secure funding later in the year, the board and the legislature need to realize that wer have no alternative solution if the plan fails later in this fiscal year. This will put Shreveport and New Orleans at risk as well as put LSU at risk of running a deficit;
- The only certain way for LSU is to live within its newly assigned budget is to close multiple facilities now. If we do not do this, we are running the risk of delaying and creating an unmanageable budget crisis later in the year that will put Shreveport and New Orleans at risk. That risk includes others blaming LSU for not taking actions earlier.
“I am asking that you share this memo or at least the substance of it with the full board to ensure they are informed and that their direction to us that we delay definitive budgetary action until the end of August to better assess the likelihood of a Shreveport sale with a statewide distribution of the proceeds is clear and unambiguous,” Cerise said in his memorandum to Jenkins.
At the conclusion of the meeting, Jenkins called for the creation of a task force to include then-Commissioner of Administration Paul Rainwater, Greenstein, George, Yarborough, McCollister, Ballard, Mighty, Barish, Hollier, Cerise and Townsend.
But in a matter of weeks, Cerise and Townsend were gone.
And a year later, a blank contract was agreed to which allows Biomedical Research Foundation of Northwest Louisiana (BRF), an organization with no appreciable cash flow and no experience in running a hospital, to assume control of LSU Medical Center in Shreveport and E.A. Conway Medical in Monroe—facilities with combined revenues of about $400,000.
Moreover, BRF will receive all the facilities’ assets with the state getting the liabilities.
Louisiana Voice 
Give em hell!
Marion K. Marks From the road
Thank you for shedding more light on the sell off of our health system. Isn’t John George also affiliated with BRF?
Yes. We’ve written about that extensively. Dr. John George is both a member of the LSU Board of Supervisors and is CEO/President of BRF. We fell this is an obvious conflict of interest as similar scenarios have been deemed as such.
Yes but Tom, didn’t the “Ethics Board” (smirk) give him the okay? 🙄
Aren’t teleconferences for public bodies as listed above illegal under the Open Records Law?
Not that I’m aware.
Sorry, Tom. I meant Open meetings law. Where was the mandatory public notice and how was/is the public to observe the teleconferences of public bodies, when deciding how the voters/taxpayers money is to be spent and public policy enacted?
I believe that as long as no voting quorum is present, members of a board, i.e. the LSU Board of Supervisors, can meet. But it is strange that the four LSU Board members present could speak for the entire board and/or the administration in directing the LSU administration “to pursue this strategy.” State law strictly prohibits any official action without due notice of a public meeting and the presence of a quorum.
There was a time when LSU Shreveport and LSU New Orleans along with E. A. Conway were dynamite teaching facilities. Individuals throughout the United States and many, many foreign countries sent their best and brightest to be schooled through these facilities. Now, what will happen is unknown and with cutbacks, lack of funding and lack of support from the legislature, the past leaders of these facilities have been eliminated by friends of Jindal and may never be the teaching facilities they once were! In any doctors office today you would see that 75-80% graduated from LSUS and LSUNO. These were once some of the leading teaching hospitals and operated on a tight budget, but were known for their accomplishments of care for all people, rich and poor. The LSU Board of Supervisors will regret their decisions, if they haven’t already, of removing Drs. Cerise, Townsend, etc., who knew first hand the dedication and work of all those involved with the above facilities. Teaching young residents, interns and doctors was number 1 with these facilities/individuals and you can bet that is no longer the goal set forth by the Board of Supervisors or the Biomedical Research Foundation of NW Louisiana.
Now, back to “follow the money” and it doesn’t matter how good you are or were when Jindal dictators are in control. Very interesting and informative article Tom, thank you.
After observing recent delivery of patient care in this age of “diaspora” of physicians for training in conjunction with “the private sector partnering” and corporate medicine in general I have reached many conclusions, none of them good, people. I’ll share just a few.
* In the 1970s-80s, when I worked a “big Charity”, if you went to one of the public hospitals, you knew you’d be treated by a doc-in-training and were billed according to ability to pay. They were, however, under the close supervision of professor docs.
* Today, you don’t ever know who is really delivering the care, the docs-in-training (as well as nurses even on specialty units) seem to move like “ghosts in the night” … the patient never has the same “care giver” two days in a row — usually the nurse is with a service, works only week end specials, was pulled from another unit because of staffing levels, etc. Continuity gone, start over new every day, Alzheimer’s epidemic of medical training now in place. Excuses from the doc-in-training for errors and oversights, “I’m just the messenger”, “The nurse told me what was on the discharge order and I wrote the prescription like she said because I was seeing another patient at the time”, “No I won’t write you a note explaining why the mix-up in dosing happened”, “Yes I’ll call in the prescription correction if you give me the pharmacy phone number” {now he’s taking directions from me over the phone” and he was an LSUHSC cardiology FELLOW, not even a lowly intern or resident, someone who had to have practiced medicine as a licensed physician for a number of years to even be considered for admission to the program {look up requirements for fellowships at LSUHSC web sit} making excuses for his inferior delivery of patient care to an 85 year old woman, being discharged from her second hospitalization for acute cardio pulmonary edema in 3 months, a complications following heart valve replacement at the end of April 2013.
* Practicing, fully certified and licensed docs during my hospital employment years wanted the trainees at any level at the public hospitals so:
–they wouldn’t complete for patients and thus health care dollars
— everyone who came to those facilities knew to a certain extent they were offering themselves up as “specimens” in exchange for lower, if any, cost and often received cutting edge (no pun intended) treatment being developed through the medical schools
–those private sector docs were proudly also professors at the medical schools and knew centralization of training minimized practice errors as well. They would take the students with them on rounds at private hospitals or have the patient transferred to the public hospital if the case was of particular teaching value.
–many of practicing docs had policy making roles but little financial interests in private sector hospitals, because most of the hospitals were then owned or run by foundations and faith-based groups.
–These docs had admitting privileges at multiple facilities to have more inventory of the fewer available beds when needed by thereby generating revenue for themselves and the hospitals.
* Come the days of corporate medicine, insurance contracts, capitation of docs and rewards for not filling beds, privatization of hospitals, public-private partnerships to close beds, hospital based physician groups, etc. …
–well if you get the students, they do the work for you like indentured servants, which they are,
–and they make excuses for their sloppy patient care even at the fellowship level
–and their identified supervising physicians remain silent on the problems even when asked directly about it by the patient or their agent … and especially no apology which would infer responsibility
–“the buck stops with no one” and medicine is no longer about patient care, only about bucks
*LSU alumni, though many, and somewhat culpable like all of us because can only act at the voting booth. THE GRADUATES OF LSU MEDICAL SCHOOL AND TO NO LESSER DEGREE, THOSE OF TULANE, SHOULD BE DOING A RAINDANCE ON THE DESK OF THE GOVERNOR. Not only is the medical education cow which nourishes their industry being sucked dry and on the auction block for the slaughter house, but one of the true models LA had to hold up before the nation proudly is being decimated before all our eyes while we wink and blink. Physician complicity is rampant and it is repugnant, but it started years ago with the “corporatization” of medicine. And this is the real reason New Orleans nor any other part of LA will ever rival Houston medical center as a biomedical hub despite the Gov’s hallucinations . All the true Houston visionaries, most of whom at least in the early days trained at LSU or Tulane, spent their own blood, sweat, tears and lifetimes creating that infrastructure. But they didn’t have the lure of the “fast track” for anything. And we no longer have anyone of the John Adriani M.D. ilk in the medical community of LA. May he RIP and not flop around in the grave…unless he wants to pay a “ghostly visit” to Bobby and give him a true vision.
WOW. Thanks for the insights from one who apparently knows what you are talking about. Sad, though, and there appears to be no turning back at least in our lifetimes.
Cate I can not thank you enough for telling it like it is.
Cate, I spoke and communicated daily with Dr. Roy Clay when he was first at Conway, then later went to LSUS and I would love for him to still be there. He would fight for his residents and would probably stand up to Jindal and give him that true vision of what a teaching hospital has to do to remain vital. Wonderful man and made a difference in many a doctors life. His doctors are spread though out the world today because of his vision and expertise and knowledge. He fought the system for many years to do right and would not take “no” for an answer. So much has turned to waste by this administration that as stated before, we will never get back to where we were before Jindal came into office and his belief out with the old, in with the new, sometimes new isn’t good enough.
To all of you: It may take years to rebuild, but none of us should quit on LA Healthcare and Medical training efforts. We need to vote for non-privatizing candidates and send those who supported privatization packing.
This is our state and we need to train and retain qualified M.D.s, nurses, and other healthcare or the future of our children and citizens in Louisiana will be worse in the future.
Jean Armstrong you are so correct when you say we need to vote people in who are opposed to privatizing our State!!
The repair will be impossible. All those heads are gone and the policy moves forward. This coup was very well orchestrated.
So, you do go back to past occurrences that involve La cronyism and fraudulent activities……..!!!
Sent from my iPhone
I’m not aware that I ever said otherwise.
Where are the LSU Alumni? Alumni of any and all colleges and schools of the University should be united in their opposition to Jindal, a non-LSU graduate, disemboweling their alma mater. If 90,000 of them can get interested enough in the LSU football program to attend games, you’d think the million (or whatever) graduates could unite to save their university from One horrible governor and 12 selfish men bent on destroying a great medical teaching system all for their personal short-term gain.
I guess LSU Alumni just aren’t up to the standards of the University of Louisiana Universities Alumni.
I have wondered same from very beginning of this nightmare.
The sad truth is that at least 50% of these alumni blindly support this petty tyrant and 25% of those aren’t even aware any of this is going on. But you are right that 99% will be tuned in on fall Saturday nights.
Watchman71270, Excellent question!!! The people in our state that have been in both High Ed and Elementary & Secondary Education were ever willing to stand up and be heard at the Legislature that Voters Rights, Education, Healthcare are to come first. Do you realize that more tax credits were given to the Film Industry last year that the cuts to Higher Ed. Purportedly this was in exchange for the jobs for locals that would occur. Recently, I was at the LA Arts and Science Museum., when they were shooting a film. Imagine my shock, when even the catering service truck was from Los Angelos, CA. Hopefully they bought their food locally and paid sales tax!!!
Jean, let’s at least hope they bought and served some Louisiana seafood!
“BAM”
I wonder when the idea will hit them to privatize law enforcement! Or better yet, privatize law firms! I would love to see law firms privatized! Can you imagine attorneys beholden to the Koch brothers? Where maximum pay is $40 an hour, and minimum pay $20! This will never happen, but we can imagine!! Oh, and by now I should have learned to never say never when it comes to greed and money!!
If that were to happen you would then hear a REAL backlash from all TV outlets because of the massive loss of ad dollars from these law firms.
I have forwarded this to Lou Gehrig Burnett, and I have copied Carmody, Peacock, and Smith-Buffington.
What a way to awaken the sleeping giant!! They are privatizing education and healthcare, which affects professionals, such as doctors and teachers! Why discriminate against attorneys? I don’t think it’s fair to leave them out!! They could administer a 5 week course, and obtain a license to practice law! Mr. White took a 5 week course to become state superintendent of education…hmmm…..
The end of Jindal’s race to the White House: the more he talks the less his chances to nomination for President: talking points with the same boring narratives:
http://www.politico.com/story/2013/08/the-end-of-race-95875.html#.UhoILdOPj_0.twitter
[…] Tom Aswell has recently reported on his Louisiana Voice blog, Levine was one of twelve people who met on July 17, 2012, in the LSU President’s conference […]
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