Columns » Between The Lines

Memorial's case mismanagement

Between the Lines



To all those cynics who were breathing fire over the $1.15 million severance deal for Memorial Health System CEO Dr. Larry McEvoy, here's a little observation.

You were simply getting a full dose of your own medicine. And you didn't want to swallow it. You wanted the Colorado Springs city government and its enterprises to be run like businesses. But when that happened, you didn't like how the money was spent.

Sorry, can't have it both ways.

You've talked about Utilities needing its own separate board with as much expert knowledge as possible, similar to Memorial's. But when those Memorial trustees decided to think and act like a real hospital board instead of like political animals, suddenly you wanted heads served on a platter.


This is not to say Memorial's board has done everything right, because it certainly hasn't. We've seen a series of public-relations disasters involving Memorial the past two years, whether initiated by the board, MHS staff, City Council or task forces.

If everyone involved with the MHS board had to take truth serum, they'd probably say they shouldn't have hired McEvoy in the first place at the start of 2008. He was an emergency-room doctor with limited experience in high-level management. He had sufficient credentials for some kind of supervisory position, but not CEO over a $500 million operation. Still, he had ideas and enjoyed the staff's support — for a while.

Some might say McEvoy pulled Memorial out of terrible financial troubles in his first two years, but the good people around him in upper management had at least as much to do with that, if not more.

Then, as the pressure grew to use Memorial in helping the city out of its financial crisis, McEvoy faced his first true test of leadership. The prize was simple: cementing his own future.

And he failed.

His task was daunting but well-defined: Convince the people, and City Council, that Memorial should become a separate nonprofit entity with the same management and governance. McEvoy was in the driver's seat.

Didn't happen. So, after Council voted in January to go along with a task force's decision to negotiate a long-term lease of Memorial to the University of Colorado Hospital and its system, McEvoy essentially became a lame-duck CEO. Yet before that same month ended, Memorial's board quietly gave McEvoy a $120,000 raise, upping his salary to $670,009.

Never mind that McEvoy, just 46 with many working years ahead of him, was on his way out of Memorial. Never mind that he had botched his biggest challenge as Memorial's top dog. Never mind that the hospital had cut 800 positions since 2007, largely through attrition.

Still, he took the $120,000 raise for himself. Three months later, the board delivered its biggest PR boondoggle, changing his severance terms from six months of salary (or $335,000 — a nice chunk of change) to three times that.

Here, Larry, take this $1.15 million going-away present and run.

But here's the thing: That's how other hospitals do it in the real world, where Memorial is headed as part of UCH later this year.

What can be learned from this? Hard to say. The makeup of Memorial's board won't matter, as soon as UCH takes over the lease and runs the show.

From the city's end, perhaps Council needs to focus more on cooperation and compromise. As of now, some members are trying to be diplomatic while others are showboating, manipulating and meddling.

Case in point: While Mayor Steve Bach and Council leaders Scott Hente and Jan Martin sought to help produce an acceptable compromise, Councilor Angela Dougan showed up at the Memorial board's special meeting Monday, without being invited. She even joined the board's executive session for 50 minutes, until the trustees asked her to leave for their final discussions. It didn't feel right. Or smell right. She had been among the loudest cynics, yet there she was.

In the end, there was no compromise. Instead, the city might have to live with some nasty consequences, such as legal action or perhaps more trouble finalizing that lease.

And almost everyone involved has to share in the blame.

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