Let me begin by thanking all of you for attending today. It is wonderful to see so many of our faculty assembled together and I hope that this time will be well spent for all.

First, I would like to suggest a format for our discussion today. I am sure that many of you have come with questions that you would like addressed. We will get to these questions from the floor as quickly as possible. Before we do that, however, I would like to cover a number of questions that were forwarded to me in advance of this meeting.

More than three dozen individual faculty members wrote to me with specific inquiries. Given the range of issues raised, I will not be able to cover all of the points of interest, but I will do my best to cover as many as possible. I would like to keep my answers to these initial questions to about 20 minutes, leaving the balance of our time together for questions from the floor. In so doing, I will not be able to do justice to some of the more complex issues and I apologize in advance if any of my responses seem insufficient. Whatever topics warrant further discussion beyond today will be addressed. If there were sufficient interest, I would be happy to schedule this type of town hall meeting on a regular basis.

The first and most important thing for me to say to you today is that I am incredibly honored to serve as your President. Certainly, there have been some difficult days in the almost six months since I took office. I have drawn strength, however, from the fact that I am working on behalf of a talented and dedicated faculty and staff. I applaud you for what you accomplish each day in our classrooms, clinics, medical center, and laboratories.

There are many different perspectives on the role of the President of a University. My own view on this subject was shaped by the fact that I came to this position from the ranks of the faculty. In every sense, I continue to view myself as a member of this faculty; as one of you. Accordingly, I try to measure all of my actions against the following test: What is in the best interests of the University and its faculty?

Now, having said that, the question most often posed in advance of this meeting was: "What is your vision of the future for the Medical University?" I am happy to address the question as posed, but at heart, I think that there is a much more important question, which is: "What is our vision of the future for the Medical University?" I prefer the latter version because it is clear to me that the University will accomplish only what the faculty collectively wish to accomplish. As the President, I can have all the dreams and aspirations in the world for this institution. Unless we share those dreams together, however, they will never come to fruition.

Certainly, I want to inspire you. I want to challenge you to whole new levels of expectation and accomplishment. I want to labor with you to build an academic health center here that is the rival of any in the country. At the end of the day, at the end of the year, indeed, at the end of your career, I want you to feel that you have been challenged to the limits of your ability and that you met those challenges successfully.

Now, in my opinion, we can only arrive at that point by dedicating ourselves, each and every one of us, to the unqualified pursuit of excellence. It has become so commonplace to talk about the pursuit of excellence, that the expression no longer conveys any special sense of purpose. This is most unfortunate, because the actual pursuit of excellence, rather than the simple articulation of it as goal, is rare indeed. I hope that we are prepared to dedicate ourselves to the actual pursuit of excellence in each component of our mission.

Let me be very clear on this point, the three components of our mission, education, research, and clinical service, are intimately related. As an institution, we cannot talk seriously about being nationally or internationally prominent in one area without excellence in both of the other two.

To be outstanding in education, we need to have teachers who are also at the forefront of science and others who are bringing the latest innovations to clinical care. In turn, excellence in health care delivery requires translating new scientific breakthroughs into clinical application and teaching these new techniques to the next generation of practitioners. Finally, truly cutting edge research is most likely to occur in an environment filled with inquisitive learners and where the challenges of clinical application are constantly apparent.

This may all seem self-evident to you, and if so, please forgive me for stating the obvious. I am emphasizing this point, however, because it appears that some faculty are concerned that their new President is not committed to all three aspects of our mission. It is certainly true that my personal career has been focused on research and education. It has been almost two decades since I was involved directly in delivering patient care. I am not here, however, to reshape the Medical University in the image of my own pursuits. My goal is to build as strong an academic health science center here as possible, and that requires a robust, vigorous, innovative clinical program.

While I am on this point, let me take a brief detour to address the issue of individual faculty expectations with respect to the three components of our mission. It is conventional wisdom that one has to excel in all three aspects, or at least two of them, in order to get promoted and tenured. If this was ever true here, and I doubt that it was, it certainly does not make much sense today. Although we can all think of rare individuals who manifest superior achievements in teaching, research and clinical care, they are the exception, not the rule. Rising patient care loads make it difficult, if not impossible, for a busy clinician to spend sufficient time to be a leader in research or teaching as well.

As Provost here for almost five years, I participated in every tenure decision during that period of time. With great confidence, I can assure you that many outstanding clinicians were awarded tenure on the merits of their excellent patient care, with modest achievements in other areas. It has been the practice here to reward achievement in any one of the three mission areas as long as it is critical to the success of the University.

Some might interpret this approach as a tolerance of mediocrity. Quite to the contrary, it is an emphatic endorsement of excellence. We should avoid watering down faculty performance by placing unrealistic expectations across multiple areas of performance. If we want to be strong across the board as an institution, then we need to celebrate success in any one of our core areas. For those who feel that they will go unappreciated because they are not the classic "triple threat," I tell you that does not accord with my own observations of academic advancement here.

Let me return now to the institutional imperatives for the years ahead. In the area of education, we need to compete successfully for the brightest students and residents. We need to teach them in a nurturing environment, in facilities that permit small group interaction and benefit from the latest advances in technology. We should model for them high standards of ethical conduct and appreciation for the power of interdisciplinary collaboration.

In my opinion, the greatest deficiency in our present educational environment is our facilities. We cannot attract the best teachers and the best students to the Medical University, if our learning environment looks like a disaster area. We have not built significant educational facilities on this campus in over two decades. When I arrived here five years ago, the principal complaint of students was the lack of small group study space. In the interim, we have expanded such space in the library, and we have invested considerable funds in upgrading our classrooms. We have a long way to go, however. We have a Dental School that in its 30-year existence has never had a building designed specifically for dental education. We have a College of Pharmacy in a 50 year old building that until recently has had essentially no upgrades. We have a College of Health Professions that is scattered across seven different locations, in space that was not originally designed to house educational programs.

As you know, the Commission on Higher Education ranked several of our capital projects among the highest needs statewide. The state budget still is not resolved and it is unclear whether capital projects, as a group, will survive. Nevertheless, both the House and Senate budgets included a third of the public funds needed for the College of Dental Medicine building. The Senate version also included funds to get started on the Pharmacy renovations. We have made our case effectively, in part because of our successful private fund raising efforts. We have raised several million dollars toward the Dental Building over the past six months and we are just getting the fund raising campaign started. I will not rest until we have state-of-the-art teaching facilities on this campus.

Research on this campus has grown at an astounding pace. Extramural funding has risen fivefold over the past decade. We have surpassed both Clemson and USC in the magnitude of our research enterprise. In my opinion, continued growth of research on this campus will require three key ingredients: (1) additional facilities; (2) improved infrastructure; and (3) strategic investments in equipment and personnel. With regard to facilities, two major projects are underway: the Children's Research Institute and the Hollings Cancer Center expansion. The former project is in the design phase and is on schedule for groundbreaking in the fall. If all goes well, the Children's Research Institute could be completed within about three years. Most of the funding for this project is in hand through institutional bonds, with the remainder being sought through private support. About a third of the private funding has been secured this year and I am confident that the remainder will be raised once the construction is started. The Health Sciences Foundation is so confident of the fund raising that they have agreed to backstop the fund-raising effort.

The Hollings Cancer Center expansion is fully funded, largely through the extraordinary efforts of Senator Hollings. The space of the Cancer Center will essentially double, with roughly half of the addition devoted to research and the remainder to enhanced clinical facilities. The architectural contract is being finalized, with design work to begin soon. If all goes as planned, this doubling of the Cancer Center will be completed within three to four years.

These two projects will include additional space for laboratory animals, which is in short supply at the moment. The Children's Research Institute will have a whole floor dedicated to laboratory animal facilities. In the interim, we are exploring short-term options for adding more capacity to handle animals contaminated with pathogens, as well as developing the capacity to rederive mice that harbor pathogens.

The infrastructure needs for research reflect the fact that we have grown so quickly from a cottage industry that we have yet to accommodate to the scale of our present operation. This relates to all aspects of research administration and grants accounting. As we move to fill the position of Associate Provost for Research, this will be one of the main charges to that individual.

With regard to equipment and personnel, there are some areas of identified need. For example, we have set a priority on developing structural biology on this campus. Dr. Yusuf Hannun has accepted the responsibility for building strength in this area, and we have targeted initial resources towards the recruitment of a x-ray crystallographer. Another example provides an interesting illustration. We have nationally recognized investigators in the area of functional imaging of the brain. At the same time, we have aging imaging equipment, sorely in need of replacement for both clinical and research applications. We are in the process of exploring the development of a strategic alliance with a company that manufactures state-of-the-art equipment in order to build our capacity in this area.

Let me turn now to the clinical arena. That is the part of our mission that clearly is facing the greatest challenge. Much of the problem is financial and I have been asked to comment on the sources of this problem. There really are multiple causes. First, the Balanced Budget Act of 1997 has hit the Medical University, and academic health centers in general, especially hard. In our medical center, we lost cumulatively over $17 million in disproportionate share and another $20 million in direct and indirect medical education payments. At Charleston Memorial Hospital, we lost $10 million in disproportionate share payments because of the Balanced Budget Act and a reallocation within the state because of decreased patient activity there.

The federal reductions were compounded by deeply discounted private insurance reimbursement. We are now collecting only slightly more than half of billings. I doubt that any of this is news to you. What you may not realize is that the worst year for us in terms of financial performance was 1999. During that year, our hospital lost about $40 million. There were sufficient reserves accumulated in prior years, so that the deficit simply ate into those reserves. This year, we will come close to balancing the budget in the hospital, which represents a tremendous improvement over last year. The problem is that we have used up our accumulated surpluses and there is little margin for error.

As the medical center goes, so goes the academic program. In the glory days of the medical center's performance, we were transferring $30 million a year to the academic program. This money mostly went to the College of Medicine where it was used for operations, facility renovations, recruitment and other purposes. In 1999, the transfer of funds from the medical center stopped. The College of Medicine was able to use accumulated surpluses to avoid downsizing. Now, that cushion has been used up. I do not mean to focus unduly on the College of Medicine. By far and away, however, most of our financial challenge is in the College of Medicine, UMA, and the medical center.

We have reached the point where our excessive rate of spending must be curtailed and this must happen quickly. We will face adjustments in our workforce in many departments and we will have to explore additional ways to reduce expenditures. The year ahead will be filled with difficult challenges in facing these financial exigencies. We have no choice, however. The future of the Medical University requires that we bring our financial house into order. We will examine every program in every aspect of our mission.

There is every reason to believe that this challenge will be met. First, tomorrow the Board of Trustees is scheduled to review and approve the final steps toward implementation of the hospital authority. It has been estimated that we can save as much as $10 million in operations through efficiencies in procurement and a more market-based paid time off package for employees. In addition, we have been fairly successful in encouraging our state elected representatives to appropriate matching funds for the disproportionate share program and improving hospital Medicaid reimbursement levels. The state budget is not yet finalized, but some compromise between the House and Senate versions could bring anywhere from $5 to 9 million in extra revenue. Finally, there are several bills before Congress right now intended to bring partial relief for some of the cuts created by the Balanced Budget Act. In combination, the authority, state appropriations and restored federal funding could help alleviate some of the pressure on us. It would be a mistake, however, to assume that our problems will be solved by others. We need to act responsibly and that means significant changes in our spending patterns.

Now, even as we address these historical trends of deficit spending, we must be planning for the future of the clinical enterprise. That means making key investments. In my opinion, those investments should be made strategically in areas that we have particular strengths or can assume a leadership position. I do not intend the following list to be a complete inventory, but examples of the areas that I have in mind are cardiovascular disease, cancer, diagnostic imaging, transplantation, digestive diseases, ophthalmology, diabetes, and substance abuse. Given the modest size of our population base, we simply are not going to compete with the major national centers across the board. We need to be focused.

This brings me to the issue of our aging clinical facilities. We are all aware of the fact that our main teaching hospital is a half-century old, and despite repeated renovation, it is simply not an efficient and attractive setting for delivering care. We need to develop plans for the replacement of this facility. In so doing, I believe that we need to answer four strategic questions about our future facilities:

I can tell you my answer to each of these questions, although clearly there needs to be much more discussion and input from others. I would suggest to you that the future will require us to be geographically disbursed. This probably is true anywhere in the United States, but it is certainly the case when one evaluates the likely growth centers of coastal South Carolina. With regard to the second question, I believe that downtown Charleston will become an increasingly inconvenient and expensive location for patient care. The market will grow out to our periphery and if we do not move out to it, it will not come to us. Third, I think that we have to approach new facilities in an incremental fashion. This is a matter of operational efficiency, as well as one of capital requirement. Finally, I believe that capital needs and other factors will require that we affiliate with other providers in various markets.

A process of strategic planning on these issues was launched two weeks ago in a retreat involving most of the leadership of the clinical enterprise. I envision this effort moving forward in the coming months, involving a broad cross-section of the faculty. We need to be clear that our goal is to deliver care that is at the forefront of clinical advances, accessible to our patients and provided in attractive, state-of-the-art facilities.

The last point that I want to address is a perception on campus that we are losing a large proportion of our most productive faculty. Much of this concern, although not all of it, originates in the College of Medicine and the clinical departments in particular. Dr. John Heffner of the Dean's Office has compiled some information to put this matter into perspective. When compared to each of the past two years, the annual rate of departures is up from 6.1% to 8.2% of the College of Medicine faculty. Most of the increase for this year occurred from July through December of 1999. In spite of the modest increase in the numbers of departures this year, the total number of faculty in the College of Medicine has risen by over 15% during the past two years. If anything, we are certainly not experiencing a net loss of faculty.

This is not to say, however, that the resignations are not a significant concern to me and to others in the administration. Certain departments, such as orthopedics and surgery, have experienced particularly high rates of departure. In addition, some of those who have left are among our most productive clinicians.

To me, one of the most damaging aspects of these departures is the growing perception that the administration does not care about them. Indeed, I have heard repeated on several occasions that when confronted with the issue of departing faculty, one of our senior administrators reportedly said that it is no big deal, we will just replace them. This comment, whether actually spoken or just urban myth, has grown to mammoth proportions. If nothing else is remembered from my remarks today, I hope that this message will be preserved. We have an investment in every faculty member on this campus. We recruited you here because we wanted you to develop your career on this campus. We hope to provide an environment where you can succeed and feel valued and rewarded. If we have failed to do that, then we have failed you in a fundamental way. I am firmly committed to working with you to restore a sense of trust and confidence that must exist between the administration and the faculty.

This is a good place for me to conclude my prepared remarks. Certainly, I have not addressed each topic mentioned to me in advance of this meeting. Nevertheless, I have tried to touch on as many as possible under the assumption that these are of broader interest to the faculty-at-large. I appreciate your patience and would now like to open the meeting up to questions from the floor.

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