The University of Chicago Magazine

This summer the University Board of Trustees restructured management of the Hospitals and the Biological Science Division’s clinical programs, creating the University of Chicago Medical Center, a $1.4 billion enterprise led by CEO James Madara, who continues to serve as dean of the BSD and University vice president for medical affairs.

The Hospitals board also expanded. Now known as the University of Chicago Medical Center Board and chaired by Valerie Jarrett, vice chair of the University’s board of trustees, it provides oversight for the combined clinical organization. In November David Hefner, formerly COO for Penn State’s Milton S. Hershey Medical Center, joined the management team as the Medical Center’s president, reporting to Madara.

The merger, says Madara, was designed to restore “a unified sense of purpose to medicine and the biological sciences. This strengthens not just the clinical enterprise but also promotes research that crosses the boundaries between the biological, physical, and social sciences. At the same time, it enhances our ability to teach students how to go about producing the science and practicing the medicine of the future.”

On a practical level, the restructuring makes for a more coordinated, efficient operation. “By integrating hospital and physician services under single leadership,” says Madara, in contrast to the previous system where physicians reported to the BSD dean, “we can optimize care for our patients.”

The unification also helps to streamline reporting of revenues and expenses. “The new structure provides a better system to match clinical investments with financial returns,” explains John Pearman, the center’s chief of staff. “With an integrated budget, there’s now incentive for the whole medical center to build nationally prominent programs.”

When the BSD, for example, recruited a top lung-transplant team from Loyola University in 2005, the division spent about $6 million on salaries, space, equipment, and related costs. Yet it’s the hospital that performs lung-transplants—expected to bring in $2–$3 million a year in income.

The idea of a unified structure also seemed to reflect the University’s principles. “Our strength at Chicago has always been based not on size but on cooperation, collaboration, and imagination,” Madara says. “This was a way to intensify our focus, to work together more closely, to use limited resources in the most powerful and productive ways.” In fact, the new organization recalls the one in place until 1986, when the Hospitals split off to form a separate corporation (whose sole member is the University).

Half a year into the restructuring, Pearman points to successes: the Medical Center has consolidated financial operations, facilities, board relations, and services such as media and public relations. Other functions—such as information management, where the research value of openness and the Medical Center’s responsibility to protect privacy must both be honored—will take longer.

The big picture will define long-term success, measured “by looking at research productivity, not just on volume but also on significance and imagination,” says Madara. “We will look closely at faculty recruitment and retention. Are we building and keeping teams that our competitors around the world will envy? Are we attracting the kinds of students we want and producing the kinds of scholars that the world of biomedicine needs? And, finally, are we finding new ways to bring this sort of intensity into the clinical arena?”

The answers, he notes, “will take time to assess, but we think we can make a real difference, and we seem to be on the right track.”