UMC Board Meeting Notes

I attended a portion of the UMC Board meeting this afternoon.

As far as public input goes, a new policy, announced in the agenda, requires that anyone seeking public comment must sign up one half hour before the meeting and speak only to those topics on the agenda.  This effectively preempted public input.

A few interesting issues emerged as the board met with J.P. Morgan Chase regarding financing in the basement of the LSU Interim University Hospital:

1.  Is Causey, Demgen, and Moore, Inc., the "independent" party being brought in to review the feasibility of LSU's University Medical Center in the LSU Footprint actually independent?  It appears that LSU is paying it...and somehow it's independent because it's doing the study for the UMC.  The elephant in the room at the meeting: isn't that obviously a conflict of interest?  The lawyer on hand was called upon to opine as soon as it became a bit too awkward.

The independence of the review is relevant to whether or not UMC could obtain insurance for the project via FHA under HUD, as opposed to going the route of seeking funds in the private bond market, a more treacherous undertaking (sorry for the acronyms - if you don't know what they are, there's a good chance you probably haven't read this far anyway).

2.  Where are the patients going to come from that will fill the expanded 424-bed facility?  One of the board members, Mr. Volkert, asked this legitimate question.  It also became clear that it's difficult to predict any numbers along those lines clearly given the uncertain impact of Obamacare.

3.   If the application for HUD insurance fails...what then?  Only 25% of applications are accepted by HUD.  One board member, Ms. Abell, asked how such a rejection would affect UMC's ability to then turn around and seek to go down the private bond market route.  Nobody really answered, but the impression seemed to be that the prospects in the bond market would not be good if the application failed even the easier HUD route.

4.  Site preparation for the LSU Footprint is slated to begin in November.

That's what I can report from observing nearly 2 hours worth of the meeting, but it wasn't over when I left.