GALVESTON — John Stobo sees widespread improvement at the University of Texas Medical Branch during his decade at the helm. But the hospital system continues to struggle to meet its commitment to care for those without insurance, he said Monday.
What’s more, Stobo said he’s given up hope that the Legislature will pony up enough money to solve the problem.
Stobo steps down as the medical branch’s president at the end of August.
He announced his resignation from the post last year amid criticism about his handling of the institution’s latest round of job cuts and the implementation of other economies intended to put its fiscal house in order.
Stobo oversaw his first round of such cuts shortly after he arrived in 1997.
The primary cause of both cutbacks was the same — the medical branch’s inability to find new revenue to cover the growing cost of caring for those without private or government insurance.
Despite the acrimony about the latest round of cuts, the medical branch has been the scene of numerous achievements during the past decade:
• Many fields of research, including neuroscience, diabetes and aging, have risen to new prominence. Funding for research more than doubled during the period, to $155 million in 2006.
Particularly prominent is research into infectious diseases. In addition to a number of other programs, the university next year will become home to one of only two national laboratories for such research in the United States.
• The medical school’s reputation also appears to be on the rise.
For each of the past four years, medical branch graduates did better than the national average. For example, 99 percent of its class of 2008 passed the national medical licensing exam. The national average was 92 percent.
• In terms of patient care, the medical branch achieved Level 1 Trauma status for its emergency room and several areas of care received national recognition during Stobo’s tenure.
Perhaps overshadowing those achievements, though, have been the institution’s financial woes — mostly the result of caring for indigent patients.
In 1999, as the institution was hemorrhaging money, Stobo decided to cut hundreds of jobs and tighten access to free care. Although unpopular, the moves put the medical branch back on a sound financial footing.
At least until 2003. That’s when the Legislature cut $50 million in funding to the medical branch.
It may not seem that big a blow to an institution with a $1 billion annual budget but, when the cost of patient care is rising by 6 percent to 10 percent a year, any cut hurts.
Worse, most of the care given at the medical branch is paid by government programs such as Medicare and Medicaid. And reimbursement from those programs isn’t keeping pace with medical inflation.
After an unsuccessful attempt in 2005 to persuade the Legislature to restore the funding, the medical branch was faced with a $20 million operating deficit last year. To deal with it, the institution again cut back, slashing 1,000 jobs from its 13,000 member workforce in 2006.
As the Texas legislative session began in January, Stobo and other medical-branch officials asked the state to restore the institution’s funding for indigent care and increase it.
But they were again rebuffed. Lawmakers from other parts of the state argued that it wasn’t fair for their constituents to shoulder an equal part of the bill to care for the medical branch’s indigent patients, 76 percent of whom come from a six-county area.
That’s especially true, opponents said, of residents of Dallas County. They already were paying to care for indigent patients through local hospital-district taxes.
The refusal convinced Stobo that it would be fruitless in 2009 to again ask the Legislature for more money to care for patients without their own insurance.
“We heard in spades in this session of the Legislature that that ain’t gonna happen,” he said.
That leaves the medical branch with a narrow set of options.
It could set up a health district such as the one in Dallas, but that would take governance of the institution away from the University of Texas’ board of regents. It would be governed instead by the commissioners courts of the counties that would make up the district.
It could seek to augment its income by trying to attract more patients with private insurance. But such an attempt — to build a clinic at Victory Lakes — was shelved this year in the face of criticism from state Sen. Kyle Janek.
The medical branch could simply continue to take the $120 million it gets each year for indigent care and use it to care for fewer and fewer patients as their care grows more expensive.
But Stobo hopes the institution doesn’t take that option.
Calling a single-payer national health system unlikely, he said the best solution to the indigent-care crisis would be a statewide plan that would cover all Texans or at least those who had no other coverage.
“It’s not going to work unless it’s statewide,” he said.
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Stobo Steps Down But Not Retiring
John Stobo, 65, will hardly retire after he departs the president’s office at the University of Texas Medical Branch at the end of August. He’ll be taking on two jobs, each of which would seem full-time to most people.
In Galveston, he’ll be part of the faculty in the Institute for Human Infections and Immunity and will also help shepherd work on the Galveston National Laboratory.
In addition, he’ll work on programs to improve access to health care, including the 3-Share Plan, which seeks to expand health coverage by supplementing employer funding with government funding.
Stobo’s work for the medical branch will be half of his job.
For the other half, he’ll be executive director of the University of Texas system’s office of academic programs.
In that post, among other duties, he’ll initiate academic and research programs for the University of Texas’ health system.
