Destroying the University to Save the University

A long and rancorous effort to do away with tenure and run itself more like a business has set the University of Minnesota back for years to come.

"Just the other day there was an e-mail about a faculty member who had been threatened and had her home picketed because she uses animals in her research," says Virginia Gray, the chair of the faculty consultative committee that submitted their own tenure code revisions to the regents. "But most of the threats are from corporate interests. If your research shows that one kind of swine production is better than another, you may have a whole group of swine producers on your back. There have been many instances where legislators have called and demanded a faculty member be fired because of their research. And it is important to be able to point to tenure and say, 'That is simply out of the question.'"

Not surprisingly, the regents' tenure proposal was immediately greeted with a firestorm of protest from academic institutions across the country, accompanied by raft of negative media coverage, from the Minnesota Daily and the Star Tribune to Business Week and the MacNeil-Lehrer Report. That, along with a strong union-organizing drive among the faculty (who narrowly decided not to unionize when it was eventually put to a vote in February), compelled the regents to withdraw their proposal. Later this month, the board is expected to approve a less draconian code that is nevertheless much tougher on tenured faculty than the one currently in place. Meanwhile, over in the Academic Health Center, the contract with the corporate consultants from CSC Index has been terminated. It would appear that the upheavals that have rocked the University over the past few years finally have begun to abate.

Beneath the surface, however, the fallout continues. Department heads note that there has been a greater than usual exodus of the faculty's best and brightest, and that it has become increasingly difficult to fill the openings with quality applicants. Currently, half of the University's tenured faculty is over 55 and due to retire within a decade--a bad time to acquire a reputation of being hostile to academic freedom. As for the situation at the Academic Health Center, a tremendous amount of fear and mistrust still exists among the faculty. "The stuff they are doing is so controversial that they have learned to lie about it," says one prominent faculty member. "They say it isn't happening but, believe me, the re-engineering process is still going on. I prefer you not use my name because I believe there would be retribution against me; there is something evil and totalitarian about what is happening. This place is changing and it is never going to be the same."

Ironically, the crisis that brought the corporate consultants into the Academic Health Center was created in large measure by a medical marketplace bent on bankrupting the teaching and research-oriented hospitals so crucial to its long-term future. The managed care revolution has given us a health care system dominated by large HMOs that compete on the basis of price more than quality and have realized some of their greatest cost savings by agreeing to deliver bundles of patients in their networks to certain hospitals in exchange for sharply reduced fees. (More recently, they have simply bought the hospitals.) With the pricey baggage of its academic and research mission, the University of Minnesota Hospital couldn't hope to compete. Patient loads plummeted, and took revenues crucial to the operation of the AHC down with them.

Nor was that the only problem confronting the AHC during the early '90s. The Najarian fiasco was in full bloom, culminating in a series of scandals at the medical school that bitterly divided the faculty and led to a number of prominent resignations. For years, funding from the Legislature had not kept pace with that accorded most of the AHC's peer institutions. And the place had become bureaucratically hidebound.

Retired Medtronic CEO Win Wallin was brought in as an unpaid assistant to University President Nils Hasselmo to help straighten out the mess. In 1993, Hasselmo decided to create a powerful new provost position at the AHC that would report directly to the president. Wallin was the most influential member of the search committee. Although four names were eventually submitted to Hasselmo, a faculty member also on the search committee says that Wallin was especially keen on William Brody, who, in addition to his academic credentials as chair of the radiology department at Johns Hopkins University in Baltimore, had once owned his own biomedical engineering company (a manufacturer of MRI equipment) in California.

Energetic and charismatic, Brody said all the right things about pride and teamwork when he first arrived. Soon, however, he discovered that under provisions of the University's tenure code, some of the AHC faculty were provided a salary that included a set amount for clinical work at the hospital in addition to their base pay as teachers. When the hospital was doing well, it was a relatively painless way to retain faculty members who could be earning much more working exclusively in private practice. But with business at the hospital dramatically reduced, the salaries were costing the AHC money. Rather than buy these faculty members out, or otherwise promote early retirement, Brody took the politically charged step of agitating for changes in the tenure code.

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