Dan Jones speaks on medical center concerns, fallout of decision

University of Mississippi chancellor Dan Jones visited with the Northeast Mississippi Daily Journal editorial board on Friday. Jones spoke about his relationship with the College Board, concerns about the University of Mississippi Medical Center and the fallout of last week’s decision not to renew his contract.

He also acknowledged ongoing conversations between he and the Mississippi Institutions of Higher Learning Commissioner about a possible contract extension.

Below is a transcript of excerpts from that conversation.

Q: What is the current status of the negotiations? Where do you see things going from here?

A: This is all very uncomfortable for me. I am going to disappoint you some today for sure in what I feel at liberty to talk about today.

I am pleased there are conversations taking place between me and representatives of the IHL Board.

Jim Borsig and I have been in conversations and we are doing that in a good spirit and the conversations continue. We both think it will take several more days for those conversations to be completed. And during that period of time we have committed to each other that we will not negotiate with each other through the press and we will not talk about details of our conversations until we have consummated those conversations and are ready to make a statement.

I am pleased we are having those conversations. This has obviously been a very difficult time for me personally and for our university. This decision that the board announced a few days ago to not renew my contract. I think they would probably say the decision to begin the search for a new chancellor. I’m not sure I understand the difference between those two but apparently that difference is important to them.

Since that information was given to me last Thursday afternoon I was very disappointed in that decision. I was surprised but not shocked to have that information delivered. It has been a sad time for me but balanced by an unbelievable outpouring of support for our university. I’m grateful both for the expressions of concern and support for the university and I’m grateful for the expressions of support and concern for me and for my family personally as well. Those are both important.

If you look carefully at the words that people are saying and what they put on signs, this is clearly a combination of those. They are concerns about what is healthy and good about our university and they are expressions of appreciation for my leadership and they are expressions of concern for me. That has been very encouraging.

One of my friends sent me a note just after the student-initiated rally Wednesday that said your funeral is not going to be nearly this good. And I think he is probably right about that.

Before I close, part of what I’ve been so gratified to see is that there has been a strong and unified response to the announcements that have been made. Other than pulling together for athletic events, I’m not sure I’ve seen this kind of support from so many different factions of the Ole Miss community, and I’m grateful for that.

Certainly part of the basis for people’s emotions about this is the pride that all of us feel with the success that has been generated by the good work of our faculty and staff and the leadership team that is in place. Provost Morris Stocks and so many other good leaders that have been really doing remarkable things in the last few years that have led to the success that we see. And Ross Bjork and Hugh Freeze and others in athletics that have given us better results in sports.

Q: Not getting into the specifics of the negotiations. Do you feel there is flexibility in the talks?

A: These kind of things are cumbersome because they are decisions that have to be made by 12 people so there is a cumbersome process but I’m pleased that in a good spirit we are continuing the conversations and certainly having conversations about flexibility in a number of areas.

Q: The idea of an apology to the board. Is that a condition you would not agree to?

A: Let me not talk about the specifics of that, but I’ll talk about my attitude on apology broadly.

I’ve been married 44 years and I’ve had a lot of practice apologizing.

I would say probably 90 percent of the time when I apologize to my wife she has eventually convinced me that I have a reason to apologize. That she has earned the right to hear an apology from me.

Occasionally, I deliver an apology when I’m still unconvinced that she has earned an apology from me and I’ve found that to be a useful tool in the relationship. So I will say that on a number of occasions when the Board and I have had some sort of disagreement, I’ve expressed apology to the Board when it appears that I’ve made somebody unhappy or I’ve done something that has led to lost trust. I have said words to an apology on a number of occasions to a lot of people in my life, including my long relationship to the board.

Q: One of the broader issues in the board’s mind seems to be your lack of adherence to the governance structure. That you didn’t recognize the commissioner as your boss and that when the board attempted to get you to do something, you didn’t respect that. How do you respond to that critique of your relationship?

A: I am a passionate person. On a good day, I might be described as determined. On a bad day, I might be described as hard headed. That sometimes becomes an issue in relationships with people.

I’ll say that over a long career with people, I’ve managed to have strong and healthy and trusting relationships with the vast majority of people I’ve dealt with. I’ve never had an issue with a supervisor or supervising group or anything like this. As I’ve said several times before, I’m comfortable with the decisions I’ve made and comfortable with the decisions Dr. Keeton and the leadership team at the medical center have made over the last number of years, including those areas where the board has expressed unhappiness over the pace of change.

The leadership team has made priority decisions about what can be done and when and certainly the medical center is a large complex organization with a very large budget. Not surprisingly in a resource-challenged state with lots of needs and with goals of trying to make our medical center a modern and efficient academic medical center, as we’ve made the transition in a lot of systems from old technology to what is required in a modern health care system. There certainly are things that haven’t been as effective and efficient as we would have liked and the implementation has been slower than we would have liked. We’ve had disagreements with the board probably about prioritizing those things.

One of the areas that has been noted a good bit by the board in their statements is what an external review identified as a failure to bring for board review a good many things.

Some of those things were just oversights and mistakes that some person made in the system, but a good many of those were in transitions that were taking place in the expectation of the board office.

So, for example, a few years ago, if we had one unit of the medical center make a purchase of a service or a product from another unit, we were changing money inside the system and the board didn’t require that that go to them for review and approval.

And then there came a period of time when they wanted that approved. There are a number of examples of things like that where in the past the board office personnel and personnel at the medical center and other campuses in the system interpreted the policy one way in how they were expected to be reviewed was changed. The policy didn’t change but the expectation or the practice changed. Much of that occurred over the last five or six years over the period of review of this audit, and the auditor as auditors often do took today’s standards and reviewed us over that period of time so we had this long list of things that looked bad on paper that we didn’t get approval when the policy says, and the policy said it then, but the practice at that point was not that those be reviewed.

And let me acknowledge that there were some errors that took place over that period of time but the number of errors and the types of errors were not inconsistent with what you would expect in a large operation like our large academic medical center.

There has never been at any point in time, when I was the leader there, when Dr. Keeton was leading there and I was responsible for oversight in my role as chancellor, there was never a time when we have purposefully not sent something for approval that should have been approved. There have been oversights, there have been mistakes, but there was never a concerted effort to keep things from the board or to have a pattern of not sending things to the board.

I am absolutely at peace that the work Dr. Keeton has done over the last number of years is efficient and effective in his period of leadership resulted in really good things happening at the medical center. For folks who doubt it, just look at a picture of the place in 2003 when I assumed leadership as vice chancellor and Dr. Keeton after me and take a picture of it now.

Or look at the revenue. The revenue in 2003 was about $500 million a year and now it is $1.5 billion a year. So something got done. And a lot of people got great health care.

Q: Has the board’s intense interest in the medical center changed over time, as the medical environment has changed? Did you start feeling an intense interest over time that wasn’t always there and if so, when did that happen?

A: So two things happened, and this is my perspective. There will be other perspectives.

When I became chancellor, I began encouraging the board to give more attention to the medical center. I was pointing out the obvious, we were growing very fast and we were every day a larger portion of the IHL budget.

The agenda for the board meetings was generally set around the eight public universities and things like tuition and how we allocate state funds and those were the ways we would usually spend our time. And quite frankly, the things the board would pay attention to and try to learn and understand so they would make good decisions.

Frankly, over the years, the medical center was kind of an afterthought because it was so different and because we didnt have board members who had a particular interest in that area.

I began encouraging the board to have a separate committee that would oversee and give attention to the medical center monthly. Some people ask me sometimes if I regret asking for that. The answer is no. The board needs to be engaged because it is important for Mississippi. It is an important element of life in Mississippi.

The second one has been misunderstood by some people as I’ve tried to explain it and that is the rapid change in the business of medicine, some of that brought on by legislation like the Affordable Care Act. And there clearly are going to be cost reimbursement reductions.

There are in every state, there are uncertainties because of change in health care financing. Whether you expand medicaid or not, there are uncertainties so there are a lot of small community hospitals closing. That is just the top of the iceberg.

We are in a very special circumstance because we are a state supported organization and the leadership feels a very strong commitment to healthcare in Mississippi broadly. The job of Dr. Woodward now who is running the medical center as the vice chancellor of health affairs and dean of the school of medicine. If she only had to think about not being in the red and being financially stable, she would have a pretty easy job because that is easily accomplished at the medical center. You can put strategies in place to do that.

At the medical center we are interested in healthcare broadly in Mississippi. I’ll give you an example of that. We bought a hospital in Grenada, Mississippi recently. I want to tell you that financially that probably wasn’t smart. Making money in a hospital in a small town in Mississippi, it doesn’t happen.

So we may lose some money there, but we felt it was strategic for stability of healthcare in Mississippi that that hospital have good ownership and we put ourselves forward to do that when it looked like we were the best possibility.

So in 2008, we had a recession in the country and public academic medical centers in poor states almost all lost money because our number of uninsured patients increased. At the medical center, 08-09 were tough years financially.

If you put all of this together, uncertainty, the board now is going to give a little more attention to the medical center. They are beginning to look. If that is your first year of intensely looking at it, you think to yourself that is pretty bad, this is really tough. We lost money. If you are a board member responsible for that, that would make you very nervous and it might make you think I dont know if those folks know what they are doing.

They began looking more intensely and I think some of the challenges in our relationship are because they are spending more time looking at these issues.

Their interest grew and their anxiety grew at that period of time. That was the only year we had a bottom line in the red out of the last 12 years. That is one of the pieces of evidence I give for financial stability.

Q: Some of the reaction to what was decided by the board has been people who have said they would withhold money. What are you saying to those folks? Are you giving them any guidance or direction on what they should or shouldn’t be doing?

A: I absolutely am. I began making some of those calls on Thursday afternoon after I was informed of my status and some of those folks have called me. That is an important part of my responsibility as chancellor is to bring resources to the university and private resources are an important part of my responsibility. In recent years, people have been very generous with the university in private giving and I knew this would make some people unhappy.

One of the things you like to point to when you are talking to a donor is the clear direction the university is going, so you can tell a story, here is where we are going and this is what your money is going to be used for. People who give large amounts of money don’t like uncertainty. They don’t like uncertainty about how their funds will be used.

My message to those folks was simply that Ole Miss will be fine. Whatever happens to me, we have such momentum and we have such a strong leadership team in place that whether I’m here or not here, the university will continue to move forward in a healthy way and this will be a good place for them to continue to make investments.

I also knew that some of them would in reaction to this perhaps make comments. I just asked folks to do what they felt they needed to do in the short term but to not put themselves in a box that they felt like they couldn’t get out of. That a few months from now they would love Ole Miss and they would want a way to support Ole Miss and that they wouldn’t do anything to put them in a box and make that difficult.

Q: One thing that has been interesting is the skill set it would take to manage a university is different than a hospital administration skill set. Can you speak to the uniqueness of being held accountable to both the Oxford campus and the medical center.

A: Let me say clearly that whoever is in this position needs to be held accountable and that is the board’s responsibility to oversee all of higher education, including the medical center. Their oversight role is appropriate.

It also is their role to select leaders for the university and that is their authority and their responsibility. They are acting in their sand box. I certainly disagree with their assessment of things but I don’t disagree with their authority to take action.

There are not many of us who are physicians who have led academic medical centers who are now presidents of universities or chancellors of universities. The last time I looked there were fewer than five around the country.

I think you will see more of this. Twenty years ago, the medical school or the medical center of the university would make up maybe a third of the budget of the university. These days, typically, as in our case, they make up about two thirds of our budget. It is just the reality of the inflation in health care and as technology has increased the amount of money that is in medicine.

All across the county I keep up with the comings and goings of my counterparts. And the other two places that are very visible public universities, flagship universities that have had some issues of tensions between the governing board and president of the university are the University of Virginia and the University of Texas.

In both cases concerns about financial stability within the medical center was part of the issue. University of Texas, they were starting a new medical school and there were tensions around that. University of Virginia, the disadvantage of trying to have a financially stable academic medical center in a town of 100,000 people. The reason our medical center is in Jackson instead of in Oxford is that Oxford was not large enough to support an academic medical center. The University of Virginia medical center is doing fine financially but their board became very anxious about its future. They were anxious about some other things but if you go back and tease through the good reporting that took place there, that is where a lot of the tensions grew.

I think you will see more of that because the financial risks are so large, two thirds of your budget and then the environment is so unstable. I think you are going to see more and more of that kind of thing. And whether you have my experience of running an academic medical center or not, that is a hard part of the job. I’m at peace with the decisions I have made, but it is a complex part of the job.

Q: Your relationship with Jim Borsig, has that helped bring people back to the table?

A: Yes. Jim and I are colleagues and friends and have a highly trusting relationship on a personal level. That certainly is an asset to me personally and I hope it will be useful to a good final outcome in our conversations.

Q: On the flip side of that, was the relationship between you and Commissioner Bounds strained from the beginning? Would that be a fair assessment of that?

A: I think strained would be a fair word to use.

Q: What were the reasons behind that?

A: Anybody want to swap chairs?

Let me stay at a 30,000-foot level. We had different opinions, primarily at the medical center, about what information meant.

I’m a macro data decision maker and an instinctive decision maker. I want to know the big picture financially but I don’t want to know what the profit margin is going to be January four years from now. I dont need to see that data to get to a decision.

We all know that we make decisions different ways and Commissioner Bounds was a person who liked a lot of microdata and sometimes he would know some microdata that didn’t come to my attention because I make decisions in different ways. Not that I didn’t care but the leadership patterns I’ve had over the years is to look at large overall performance on a periodic basis and make decisions about people’s judgments. If I’m satisfied that their judgment is good, then I’m happy for them to do the micro evaluation of the projects and I dont feel the need to reevaluate even for large projects that come to me.

I’d say that was a big source of the tension between Commissioner Bounds and me was that he often wanted a very different set of information to make decisions than me. I’m not saying one of us is right and one of us is wrong. But we just approached things differently.

Q: Going forward, if an agreement is reached and your contract is extended, how do you feel about your position moving forward? The board has publicly in effect declared a lack of confidence. Does that hurt you, does that hurt the university moving forward or can you be an effective leader in the aftermath of this?

A: That is an important question and that is essentially the core question for me as I make decisions about the opportunities that are afforded me.

There is a certain amount of personal decision that needs to be made, but I’m trying very hard because I have a lot of personal flexibility. Even without hair and eyebrows, I think I’m employable.

I am going to be OK. I’ve got a lot of options. I’m old enough to retire if thats what I wanted to do but it is not what I wanted to do. I’m financially prepared for that so that is a luxurious position to be in from that standpoint.

Certainly I love this job and I love, all of you who know anything about me know I love Mississippi. All of you have good positions that offer you unique positions to influence our community and our state. I like mine. I like this position for trying to make a difference. I’ve been fulfilled in the things I’ve been able to do as chancellor and I’d love another few years of the opportunity to continue to do some of those things.

But in order to have that privilege I dont want to make compromises that aren’t in the best interest of the university and that includes thinking about the position of chancellor. I don’t want the title of chancellor and have someone else with the power and the authority of the office.

That is essentially the issue for me in making decisions about whatever compromises may be offered by the board and I’m trying to think about what may be in the best interest of the University of Mississippi, even for a macro thinker, that is not an easy analysis. It is a tough analysis.

Q: Is there something we haven’t covered, that you would like to say?

A: I want to mention one group in particular for gratitude for response. We’ve had such an outpouring of support from university, I would say our celebrity alumni. Our alumni broadly. Our alumni as organized through our alumni association. If there is a group of people who could write a letter, it has been written and the response has been tremendous.

There are not many votes taken by a faculty senate where there are not dissenters. I’m going to frame that baby and put it on the wall. That is pretty special to me. I’m grateful to all of those groups, our staff council and all of the people who have responded.

I’m so proud of our students. I’m so proud of our students.

When some of us went to college back in the 60s, student activism was a part of life in America. College activism was the norm in those days. We’ve gone through several decades where there has not been much activism unless it is about what kind of coffee is going to be served or whether the beer is going to be cold or whether you are going to have to make it cold yourself.

I am so proud of our students for the way they have engaged in this issue on behalf of the university. They have been well organized. They have been civil and they have been effective at what they have tried to do and I am so proud of them.

Q: People have talked about the Gamma Knife. What happened with that?

A: There is no Gamma Knife flying around in the sky. It is a long and complicated story but it is an interesting story and tells you a lot about government and the way government works.

One of the things we are always working on is improving our clinical programs and so you pick a program from time to time and say we are going to make new investments here. We weren’t doing nearly as well in cancer treatments as we needed to be and we needed to make some improvements.

So we put plans together, we hired a new chairman of our radiation oncology program and he came with big ideas. I thought that after I had paid for him and 10 new faculty members I had spent all of the money I needed to spend but his first words were well our equipment is out of date and we really needed to replace all of our equipment and that is a big price tag. We put a group of people together to analyze that. He was right. We needed to upgrade our equipment.

Just like when you are buying toilet paper, one of the decisions you have to make is are you going to buy a roll of toilet paper or are you going to buy 10 rolls and you are going to have to store some of those 10 rolls and you may not get around to using all of them right away and you may lose a roll in your storage space. And so we had that in front of us at first and there was an opportunity to save some money by buying a bunch of the equipment at one time with the recognition that we would be storing some of it until we were ready to use it.

When you buy a big piece of radiation/ oncology equipment it takes up a lot of space that requires a lot of physical support and pouring concrete in the floor and that type of thing.

In the meantime, we were doing this in lots of different departments. We had basically for many many years been a charity hospital and we really didn’t have any insured patients. We had mostly medicaid patients and uninsured patients and the government, federal and state supplied most of the funds. As part of the change in business for health, all of those funds started drying up and it was the expectations that places like ours would start providing most of their own revenue and you would do it by providing state of the art care to a wide range of patients, including patients who had insurance.

As you began upgrading these programs, we did what other health systems did, we began marketing those programs as our facilities got better and our health systems got better. We began marketing and we irritated the other health systems because we had always been this little charity hospital on the corner and now we were suddenly saying our heart care is better than your heart care. So it irritated them.

This is a certificate of needs state for medical equipment and the health departments had always given us exemptions for those things. We had never gone through the certificate of need process because we are an educational institution. But the health systems always sued each other when one wanted to get something the other sued and said we already have one, you don’t need two in the city and they would go to court and it would take three years of court stuff to get something done.

So for the first time when we bought this Gamma Knife, we got sued by two other health systems. We brought that information to our board and the board made the decision that constitutionally it was really an important issue that we are a constitutionally separate board and the health department board shouldn’t have the ability to say yes or no to what we needed in terms of equipment. That we were an educational institution and that even if other hospitals had them, if we needed them for our teaching program then we didn’t need someone other than the IHL Board to make that decision.

They took that position and so we wound up taking the Gamma Knife and putting it further back in the warehouse while this went further with the court decision and it took a couple of years to do that. By the time we got around to having that settled and we had a 50-50 outcome on that. The Supreme Court decided we were subject to certificate of need laws but we could apply to the state health officer for exemptions for educational purposes.

We had a good relationship with the health department and that is what they did and they gave us the exemption. By this time, we had moved our cancer operations out to the Jackson medical mall and changed the plans about where we could put it and we didnt start the construction until we had other equipment and the equipment we bought was outdated by this time. It really wasn’t in the warehouse they just hadn’t delivered it.

So they gave us credit for the money we had spent and we bought a brand new set of equipment. Now several years later they are in the process of finalizing the installation of it. We didnt lose any money.

It was so long ago that I was the one who made the decision to buy 10 rolls of toilet paper instead of one. We would buy this equipment in bulk and it was less expensive and we took the risk that we weren’t going to get any revenue from that piece of equipment for a number of years. I was the one who made that decision and in retrospect as long as it took, it looked like a bad decision.

It was a bad decision, but at the time, it looked like a good decision. There wasn’t any dishonesty on it.