Ohio lawmakers concerned about the future of the University of Toledo Medical Center say a public record battle involving the hospital, UT board members, and conflict of interest accusations provide further reasons for the state to step in and investigate.
With a June 10 deadline fast approaching for UT to accept bid proposals to purchase, lease, or manage UTMC, state lawmakers are hoping Gov. Mike DeWine will step in and halt the process, at least temporarily. U.S. Rep. Marcy Kaptur (D., Toledo), who has been working with a local coalition to save the former Medical College of Ohio Hospital, said there are too many unanswered questions to allow the potential sale of the taxpayer funded hospital to go forward.
She said too many big changes are coming all at once before the public has a chance to weigh in on the fate of the hospital, adding there were little to no community discussions before UT officials announced in April they were were looking to potentially sell UTMC — at a time when they were reeling from the coronavirus pandemic. Roughly a week later, UT President Sharon Gaber announced she’s resigning with three years remaining on her contract — a move Miss Kaptur said is very destabilizing for UTMC and the university as a whole.
“My goal is sunlight, because this is a public institution,” she said. “We need to have a blue print and we need to understand what we are talking about so everyone can make the right decisions.”
But she and other lawmakers say issues raised in a lawsuit making its way through the Ohio Court of Claims provide further reason for the governor to not only halt the potential sale of UTMC, but conduct a lengthy audit of the entity, too. The lawsuit is filed by Geoff Mitchell, an assistant UT professor and UTMC physician, who is seeking financial records regarding former UT board President Steve Cavanaugh and current board President Mary Ellen Pisanelli.
Dr. Mitchell’s contention is with both board members’ role in approving and implementing UT’s 50-year affiliation agreement with ProMedica. He argues both had conflicts of interest as employees of companies with financial ties to ProMedica and questions where their loyalties lied when making decisions that sent a large number of UT’s medical students and residents to ProMedica’s Toledo Hospital and Ebeid Children’s Hospital for training while UTMC lost more than 80 percent of its staff.
The Ohio Ethics Commission looked into both board members but for the most part did not find reason to advise them against voting on matters pertaining to UTMC, although they did give guidance to avoid conflicts of interest. That eventually changed for Mr. Cavanaugh a short time later when he was hired as ProMedica’s chief financial officer — at which point he resigned soon after as board chairman.
Dr. Mitchell’s is trying to acquire copies of the financial disclosure forms the commission used while investigating the matter. So far, the Ethics Commission is arguing that the documents are not public record and is fighting their release.
When reached by The Blade, Mr. Cavanaugh responded with an e-mail, stating the terms of the academic affiliation were reviewed by the Ohio Attorney General’s Office before being finalized and that he and other board members followed guidelines laid out by the ethics commission.
“Any attempt to manipulate these facts or string them together to suggest ill intent is nothing more than a conspiracy theory aimed at grabbing media headlines,” he wrote.
In response to the accusations, Ms. Pisanelli said she would only say the matter was investigated by the ethics commission and pointed out the UT board has, on its own, looked to the commission for guidance on these matters to ensure the board was following the letter of the law.
But within those filings, Dr. Mitchell details how he also believes the ethics commission failed to properly investigate the matter and allowed UT officials to decimate the medical college to ProMedica’s benefit. He first asked the state auditor to probe his allegations against the UT board board members and the ProMedica agreement, only to have it punted to the ethics commission, which he believes is dragging its feet. He also sent letters to different law enforcement and state agencies asking for an investigation, but so far those have gone nowhere, he said.
“I want the people who broke the law to be made accountable and I want restitution made,” he said. “They trashed a treasure to northwest Ohio. It was a great medical school and it has been trashed and destroyed. This is not going to end tomorrow and it’s not going to end when they bolt its doors. ...now people have noticed what’s been going on. It’s encouraging, but obviously we’re not there yet because things keep getting worse for the hospital.”
Paul Nick, executive director of the Ohio Ethics Commission, said he couldn’t comment on the lawsuit, because it’s pending, or Dr. Mitchell’s ethics complaint about the board members because those are confidential. But he said his department has a solid record of bringing factual allegations to court when they merit it. He added his office is forbidden from sharing information about complaints, including to those who filed them with the commission, but that doesn’t mean they don’t take them seriously.
State Senator Teresa Fedor (D., Toledo), said she became increasingly concerned after learning about the lawsuit and accusations from a doctor who has worked in UTMC. It’s partly what spurred her and State Reps. Paula Hicks Hudson (D., Toledo), Lisa Sobecki (D., Toledo), and Mike Sheehy (D., Oregon), earlier this month to ask the governor to approve a forensic audit that would analyze the university’s spending as it relates to UTMC and ProMedica.
Lawmakers added the move would force the UT board of trustees to be transparent with the public “instead of denying them a voice by holding meetings behind closed doors,” referencing the April vote by UT trustees to search for a new entity to purchase, lease, or manage UTMC.
“There are a lot of unanswered questions,” Ms. Fedor said. “We’re doing best we can to have public transparency before UT board of trustees put the hospital on the chopping block.”
How the conflicts tie together
Dr. Mitchell in his court filings asserts that both Mr. Cavanaugh and Ms. Pisanelli were being paid by ProMedica business associates and had an interest in seeing that their decisions benefited the non-profit health care system at the detriment of UTMC, which was a competitor.
Dr. Mitchell said Mr. Cavanaugh — appointed to the board in 2014 and as chairman in 2017 — voted for the negotiation and approval of the public UT-ProMedica contract on May 11 and July 24, 2015. Back then, he was president and CEO of what was then Toledo-based HCR ManorCare, which was a ProMedica business partner — together building a nursing home years earlier as a joint venture on ProMedica’s Flower Hospital campus.
ProMedica would later rescue ManorCare from a $7 billion bankruptcy and Mr. Cavanaugh later resigned from the board once he was hired as ProMedica’s chief financial officer.
Dr. Mitchell asserts Ms. Pisanelli, who was appointed to the board in August, 2015 — after the affiliation agreement was signed — has a conflict of interest regarding ProMedica because she initially worked as a partner in Shumaker, Loop & Kendrick, a law firm that contracted to represent ProMedica. She then joined real estate investment trust Welltower, Inc. as Senior Vice President in July, 2017.
Dr. Mitchell notes that her tie with Welltower is a conflict of interest because the company joined in an 80-20 joint venture — known as Meerkat LLC — with ProMedica in July, 2018 to assume ownership of all ManorCare properties — the same company that Mr. Cavanaugh was in charge of.
UT spokesman Meghan Cunningham defended both board members in a statement from the university:
“All board members submit financial interest statements annually, as required by state law. In the cases where a potential conflict-of-interest were concerned, the University submitted an opinion request to the ethics commission and responded accordingly.
“In the case of Steve Cavanaugh, he resigned from the board when he accepted the position of CFO at ProMedica. The ethics commission advised that Mary Ellen Pisanelli had no current conflicts as no UToledo medical students or residents currently use Meerkat facilities.”
The road forward
It’s unclear if lawmakers will get their wish to have the governor intervene in the potential UTMC sale. DeWine press secretary Dan Tierney said the governor is watching the situation but otherwise couldn’t provide a time frame for if or when Mr. DeWine would make a decision about the requests for an audit or to halt the potential UTMC sale process.
But whether the governor involves himself or not, Miss Kaptur said the community needs to come together to determine UTMC’s future. And for that, she said lawmakers should demand more information from UT before any sale is allowed to move forward.
“The fact that we even have a university hospital is an extraordinary achievement,” she said. “This is a public university that belongs to the taxpayers. It belongs to the people of Ohio. And no private interests should engage in activities that undermine those public interests. The road forward is one where the public can participate in proposing ideas for not abandoning UTMC.”
First Published June 1, 2020, 12:09 p.m.
