Medical Schools to Faculty: "Show Me the Money"

We have posted before (here and here) about how medical schools, despite their name, often fail to pay or otherwise reward faculty to actually teach.

This month’s SGIM [Society of General Internal Medicine] Forum (should be available here on p. 13) features an interview with Dr Lee Goldman, the Dean of the Faculties of Health Sciences and Medicine, and Executive Vice-President for Health and Biomedical Sciences at Columbia University. Dr Goldman, despite being a cardiologist, is a former President of SGIM, whom I had a chance to work with when I was the editor of the predecessor to the Forum. Dr Goldman is known for saying it like it is. In the interview, he explains with brutal honesty how things now work in academic medicine, and thus explains the apparent paradox of medical schools that do not pay their teachers to teach.

[Dr Goldman was asked to talk about academic careers….] I’d add something about the cold, hard facts of Academic Economics 101. There are four categories of faculty: 1) ‘Taxpayers’ who generate more than they cost and help fuel the academic mission; 2) ‘Hired workers’ who get paid to do a job that many people might like to do; 3) ‘Loss leaders’ who get short-term investments in the expectation that they will become successful ‘taxpayers;’ and 4) ‘Welfare recipients’ – faculty with more tenuous status.

Bottom line, you should strive to be a ‘taxpayer.’

If you’re a ‘hired worker,’ you should strive to be better than the others who would like your job.

Dr Goldman reveals that in the typical medical school, the most important criterion for faculty success if generation of external funding, that is, generation of fees for clinical work, or of grants from external sponsors. Whether a faculty member is good at patient care, teaching, or research, or whether he or she upholds the highest professional standards, is secondary.

At first glance, to someone outside of academic medicine, this seems nonsensical. The incentive system described by Dr Goldman seems to be like the commission system used to reward some automobile sales people (at the smarmier dealerships). The system seems utterly different from that used in other parts of “higher” education, in which faculty are usually paid straight salaries based on rank and seniority.

The system used in academic health care may be nonsensical. It is too bad those of us in or recently departed from this arena have gotten so used to it that it seems normal.

Let me explain the context a bit. At most medical schools and academic medical centers, accounting reports are created for each faculty member. The methods used to compile these reports are such that only clinical reimbursement or external grant funding “counts.” Faculty who generate more such reimbursement or funding are the “taxpayers” to whom Dr Goldman refers.

But these accounting methods are often very artificial. These institutions actually receive quite a lot of money that is meant to support patient care and the academic mission. They collect tuition fees to support education. Academic medical centers receive millions from Medicare for graduate medical education, that is, education of interns, residents and fellows, divided into direct graduate medical education and indirect medical education funds (look here). State medical schools receive state support funds. Private, not-for-profit universities receive contributions that are tax-deductible for the donors, and collect interest and dividends from their endowments that are also not taxed. Yet rarely do faculty get “credit” for generating any of these sorts of funds. Why they don’t is unclear, and, on its face, absurd.

The current accounting systems result in bias against general internists, and other primary care faculty. Since, as we have noted before, reimbursement rates for primary care and cognitive services are low, such faculty cannot become “taxpayers” by virtue of their clinical practice. (Faculty who do procedures, like invasive cardiologists, can generate enough large fees to become “taxpayers.”) Furthermore, primary care faculty are often tasked with taking care of poor patients, and doing more than an average amount of education of medical students, interns, residents, and fellows, but the accounting systems do not count any of this work as generating external reimbursement. Thus, at best, really hard working generalist faculty can aspire to be “hired workers,” and are in danger of being viewed as “welfare recipients.” They will rarely be “taxpayers.”

The only practical way for a generalist, and the best way for any faculty member to become a “taxpayer” is to generate external grant funding. Some faculty may be talented and lucky enough to get grants from federal agencies like the National Institutes of Health, or from foundations. I used the term “lucky,” because such grant money is limited in amount, and limited in scope to the priorities of these organizations. Again, these priorities are often not the clinical and health services research that generalist academics may do. Thus, to generate external grant funding, most faculty, but particularly generalist faculty, must turn to pharmaceutical companies and other commercial sponsors. Working with such sponsors often entails giving the sponsors considerable control over the design, execution, and analysis of the research, and dissemination of its results. Medical schools and academic medical centers have often been only too happy to turn over such control (see post here). And pleasing commercial sponsors may lead to financial entanglements and conflicts of interest.

To summarize, the contemporary medical school seems to judge faculty by asking them to “show me the money.”

And this emphasis on generating certain kinds of external funding helps explain the neglect of teaching, and the increasing corporate influence over academic health care.

The call to “show me the money” is mission-hostile management, writ large, of some of our most important, and heretofore revered academic medical institutions.

The continuance of such mission-hostile management may yet doom these institutions.