Archive for Saturday, July 28, 2007

KU Hospital, former CEO ink $1.8M separation pact

July 28, 2007

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Three questions with ... Dennis McCulloch, Kansas University Hospital spokesman

Dennis McCulloch, Kansas University Hospital spokesman, discusses Irene Cumming's separation agreement.

The former top administrator of Kansas University Hospital is being paid $1.8 million to ensure that she won't work for a regional competitor, hire away hospital employees or disclose confidential information that could jeopardize the operation during the coming months or years.

And she'll be available to provide consulting services as needed, such as during ongoing negotiations regarding a proposed affiliation with St. Luke's Hospital.

The details are part of an agreement that Irene Cumming, who resigned effective June 30 as KU Hospital's president and chief executive officer, reached with leadership of the KU Hospital Authority.

The agreement, disclosed Friday with Cumming's consent,

outlines financial arrangements and procedural requirements for her transition from the hospital without the operation losing her expertise, knowledge and insights.

"She's the continuity," said Lawrence resident Bob Honse, among the authority directors who voted in March to support terms of the agreement, including its compensation. "The hospital has done incredibly well. : Her legacy is that she pulled together a tremendously dynamic team and turned that hospital around. Any way we can pick her brain is worthwhile."

Dennis McCulloch, a hospital spokesman, said that Cumming's insights would be crucial.

"She was obviously the point person for a lot of negotiations over the last year, over the affiliation agreements," said Dennis McCulloch, a hospital spokesman. "She was the point person for a lot of other negotiations as well that have not been concluded, and her understanding and her knowledge of those will be critical. And our need to use her as a resource to continue those negotiations is deemed very important."

The agreement, approved last month by both parties, stipulates that Cumming:

l Receive $1.8 million, equal to three years of salary. Cumming has received the check, which was to have been hand delivered July 1.

l Not work, in any capacity, for a hospital or medical center located within nine counties of the Kansas City metro area, including Douglas. The agreement does not prevent Cumming from keeping her current job, as president and CEO of the University HealthSystem Consortium, or for assisting with nonprofit organizations in the area.

l Not disclose any hospital-related confidential information for the next four years, without approval from the authority's chairman.

l Not work to hire any employee or former employee of the hospital or its affiliates for at least the next year. The prohibition covers anyone who has worked for or with the hospital at any point during the previous six months.

l Make herself "reasonably available" to the authority, as a consultant, for up to 10 hours each month for the next year. While Cumming would not receive extra payment for consulting - the fee is considered part of the $1.8 million outlined in the agreement - she would be eligible to be reimbursed for related out-of-pocket expenses and travel.

Details of the agreement could have been kept confidential by the hospital, but Cumming personally waived such privacy because, McCulloch said, she had "pledged transparency" in the matter.

Cumming resigned from the hospital amid tense negotiations regarding the hospital's relationship with Kansas University Medical Center, which staffs the hospital with doctors and medical students. KUMC leaders have advocated affiliating with St. Luke's in Kansas City, Mo., considered KU Hospital's chief competitor.

Cumming had cautioned that an affiliation could weaken the KU Hospital, an operation whose 2006 revenue of $540 million was up 185 percent from 1998. Cumming became the hospital's top administrator in 1996.

The separation agreement had been authorized during the hospital authority's March 19 board meeting, during which the board accepted Cumming's resignation. The board authorized its chairman, George Farha, to negotiate an agreement that would include a payment equal to three years of salary.

Money for the payment came from the hospital's operating budget, McCulloch said. The hospital does not receive tax money from the state of Kansas.

Comments

Uhlrick_Hetfield_III 8 years ago

Yet another cost of Sebelius corruption and Hemenway's incompetence.

camper 8 years ago

Geeze. These people are from another universe. 1,8 million to be "reasonably available". Good work if you can get it. They should have told her to close the door on her way out. What knowledge or insight could she possibly possess that would weaken the KU hospital? And even if she has special skills as a "point person", wouldn't it be good if she could benefit another hospital to improve services to other patients? What in the world is going on here?

camper 8 years ago

They should have just given her a timex watch and used the money to bring in a heart surgeon, maybe invest in new technology, or possibly donate it to patients who have serious medical problems but have financial hardship.

Big organizations usually find ways to stuff peoples pockets with money. It is nothing more finding a legal way to be crooked. I have seen these so called "administrators" and "consultants" who think they offer something special to the table. In the end, they don't make a difference, and the operation will continue on....with or without them. These people are replaceable! No need to hand bags of money to em'. STUPID!!!!!!

Wilbur_Nether 8 years ago

This is reasonable and not out of line for a situation like this. The cost to the hospital (and the State) if she were to poach talent or recruit clients to another regional hospital would be many times this. Now the hospital is protected from those sorts of behaviors.

camper 8 years ago

Wilbur. Who cares what the heck she does? KU has hired and is paying good money to a new administrator. Part of that administrators job is to encourage talented professionals and create an environment that makes staying desireable.

No reason for her to bag 1.8 million. Give me a break. Administrators get where they are because of the Peter principle. They are basically promoted to positions where they can do a less amount of harm. Furthermore, they are REPLACEABLE.

Wilbur_Nether 8 years ago

camper wrote " Who cares what the heck she does? KU has hired and is paying good money to a new administrator...to encourage talented professionals and create an environment that makes staying desireable.... Administrators get where they are because of the Peter principle. They are basically promoted to positions where they can do a less amount of harm. Furthermore, they are replaceable."

All of which is a gross oversimplification of economic realities.

camper 8 years ago

Wilbur wrote, "All of which is a gross oversimplification of economic realities".

This is more simple than you think. It is economic fallacy....not reality.

Administrators generally get paid more than folks who actually have a technical skill. This is where I see fallacy.

George_Braziller 8 years ago

On my 20 year anniversary I got a gold watch. A yellow colored plastic watch that came out of a vending machine and broke 15 minutes after I put it on. Not joking. And she gets $1.8 million?

Ceallach 8 years ago

and people wonder what is driving up the cost of health care

camper 8 years ago

But if they got her for 10-hours a month, they might as well make her clean the bathrooms. Atleast they'd get something for the money.

camper 8 years ago

Is this hush money? Is there something more to the story? If it is not, KU looks incredibly weak if they think this one person was so integral to their operations....or can do them future damage.

guesswho 8 years ago

Most corporations do have this type of clause - agreeing not to work for a competitor for a specificied number of years. This happens all the time in the real world - we here in Kansas aren't exposed to it that much because we don't have as many corporations, and the LJW is always out to make KU look as bad as it can.

camper 8 years ago

Guesswho, If such a clause were in place, there would be no need to pay her 1.8 million. If KU did not have such a clause, then they do look as bad as can be.

camper 8 years ago

There should be a stop pay placed on that check...if it has not already been cashed.

bruhahax 8 years ago

KU Med is private...

Here is some light reading...5th paragraph

http://www.kumed.com/bodyside.cfm?id=880

Not a state/KU issue

camper 8 years ago

This is good. No need to bash KU on this one.

camper 8 years ago

Check hand delivered July 1st. Agreement announced July 28th. What's up with this? I think this needs to be looked at more closely. Looks like corruption to me.

lacoov 8 years ago

Good Grief Marion take a nap !!

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