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Hershey Medical Center CEO Outlines Ways to Attract More Resources

Posted on: Friday, 23 June 2006, 00:00 CDT

By David Wenner, The Patriot-News, Harrisburg, Pa.

Jun. 23--Penn State Milton S. Hershey Medical Center saw a steep drop in research funding last year, largely because of cutbacks from the federal government.

Dr. Harold Paz, who became CEO and dean of Penn State-Hershey in April, also attributed the reduced funding to disasters such as Hurricane Katrina that required massive federal spending.

Research funding fell to about $88 million, down from $101 million the year before. The drop came despite a record level of funding applications from medical-center researchers.

Paz said the growth can be restored though various steps, including recruiting more researchers and developing more research collaborations between the medical center and Penn State University.

He also predicted that a new research center, which is being built adjacent to the medical center by a private developer, will help the medical center attract research collaborations that otherwise would be lured elsewhere, such as medical centers in Baltimore.

Paz discussed the medical center's performance over the past year during the annual public meeting of its board of directors. The 15-member board usually meets in private.

Paz said he expects the medical center to post a profit of about 7 percent, meaning it would have $7 left from every $100 received for providing medical care.

The industry standard for a hospital is to have a profit of about 4 percent so it has enough money to maintain and improve facilities. But unlike community hospitals, Paz noted, the medical center must use some of its profits to fund the medical school. That consumes about 4 percent of its profit, he noted.

Here are some other highlights from the meeting:

--The number of patients using the medical center increased during the past year. The biggest rise was in surgical cases, which rose 7 percent, to about 23,000.

--The incoming class of medical students increased to 145, from 135. Paz said the bigger class was prompted by a shortage of doctors nationwide and in Pennsylvania.

--Paz noted that Penn State College of Medicine graduates have an average debt of $138,064, which is more than the national average of $120,280.

Salaries for physicians haven't kept pace with the increasing student debt, he said, leading students to select specialties based on what they can earn in that field, rather than what specialties are needed.

He said more government funding is needed to curb students' costs.

--The medical center recently added an annex equipped with the most advanced devices used in neurosurgery.

--The center is building a 1,300-space parking garage and a road to the eastern section of the campus. It also is renovating its housing for medical students.

Later this year, it will begin construction of an outpatient facility and a five-story cancer center.

--Paz also noted that Penn State-Hershey has raised $23 million toward construction of a new children's hospital. The facility is being designed, but no start date has been set, he said.

In an interview afterward, Paz said the medical center's top goal is to provide a level of services that makes it unnecessary for local residents to travel outside the region for medical care.

"Diseases like cancer just don't travel well," he said.

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Copyright (c) 2006, The Patriot-News, Harrisburg, Pa.

Distributed by Knight Ridder/Tribune Business News.

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Source: The Patriot-News

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