Physician Groups Bruised By Hogs’ Medical Proposal

The University of Arkansas’ athletic department offers lots of things for sale.

From autographed memorabilia hawked via auctions on its official Web site to lavish luxury boxes that line Reynolds Razorback Stadium, the department rarely misses an opportunity to increase its cash flow. That’s standard practice for entities with operating budgets of $58 million.

What turned heads in June was the announcement of the UA’s new health care arrangement for its athletes, one that ended half-century relationships with Ozark Orthopaedics and Washington Regional Medical Center. Under the previous arrangement, Ozark, Washington Regional and Medical Associates of Northwest Arkansas dealt primarily with the UA’s football and men’s basketball teams, while the other 17 sports largely were left to fend for themselves.

The pre-existing agreements unraveled, sources said, over the UA’s request for sponsorship money in return for official provider designation.

According to sources at Ozark, Washington Regional and MANA, UA athletic director Jeff Long and other athletic department representatives in December made separate presentations to each group that included a proposal to generate $1.35 million in sponsorship revenue over a three-year period. Long operated under similar arrangements in previous administrative posts at universities at Pittsburgh and Oklahoma.

Joining Long in the presentations was Ryan Gribble, assistant vice president and general manager of Razorback Sports Properties. RSP is the on-campus arm of North Carolina-based International Sports Properties, which handles the UA’s advertising, sponsorship and multimedia rights. ISP was contracted in 2008 to provide $73 million in revenue for the athletic department over a 10-year period.

Despite Gribble’s role in the presentation, Long disputed in an Aug. 28 interview the notion the selection of health care providers was tied to sponsorship money.

“We said from the beginning that’s going to have to be a separate discussion,” Long said. “We said from the beginning, ‘We want you to have that discussion when we reach agreement with partners,’ but nowhere did we ever say, ‘You need to buy this much advertising. You need to put this much on the table.’

“It was never said.”

A copy of a PowerPoint slide obtained by the Northwest Arkansas Business Journal from a source close to the negotiations, however, paints a different picture. The slide, printed on Page 14, was omitted from a six-page group of slides obtained among other documents under the state’s Freedom of Information Act by ArkansasSports360.com.

Most of the slides released by the UA suggested improvements in regard to continuity of care, cost-containment and the challenges involved with servicing a unified athletic department. The final slide, however, was the biggest sticking point for the three medical groups. It reads: “Conclusion: Where do we go from here?”

The slide shows six bullet-pointed items, including the UA’s desire for the groups to present new proposals to the department by January 9, 2009, and launch a new partnership by March 1, 2009. The slide also asked the group as a whole to meet “a minimum corporate sponsorship level of $450k per year,” which would equal $150,000 per group per year.

In a follow-up telephone interview on Sept. 15, Long said the $450,000 figure was used “to set the stage for negotiation,” and that he thought it was only logical Ozark and the other groups would want to enter into sponsorship and/or advertising deals if they were selected as partners. Long also said he didn’t believe the $450,000 total was feasible in Northwest Arkansas, but he wanted the groups to know some type of deal would be presented “at the end of the line.”

Sources from all three groups said they believed the $450,000 sum not only was tied to the deal, but an amount the UA expected to receive.

“We were very uncomfortable with that amount of money,” said Dr. Tom Patrick Coker, a surgeon at Ozark, “and the appearance that you’re buying something instead of earning it.”

The UA ultimately announced a partnership with Advanced Orthopaedic Specialists and Physicians’ Specialty Hospital on June 4. Dr. Chris Arnold, one of four partners at Advanced Orthopaedic and an investor in Physicians’, said UA representatives didn’t bring up sponsorship discussions with his groups until the health care portion of the agreements had been finalized.

“We didn’t even talk about that,” Arnold said. “We didn’t feel any pressure, but we did want to support the Razorbacks and also let people know we are the official providers.”

The result was an undisclosed sponsorship and advertising deal between Advanced Orthopaedic, Physicians’ and the UA. Gribble said at least five other SEC schools have similar partnerships.

Hog History
The roots of Ozark’s relationship with the UA date to the 1950s. That’s when Ozark first began treating UA athletes, eventually working out a year-to-year handshake agreement with former athletic director Frank Broyles.

Washington Regional worked under a similar pact with the UA from its inception nearly 60 years ago. The agreements with Ozark and Washington Regional later expanded to include MANA, which handles UA athletes’ primary care.

In return for their services, the collective received UA coaches’ shows sponsorships, eight tickets to football and basketball games, and game-day recognition as the department’s official health care providers.

“What people need to realize is these people don’t work for an academic institution or an athletic department,” said MANA CEO Larry Shackelford. “All they have to sell is their time. Our guys do it because they love the Razorbacks and they like being around sports medicine.”

By 2005, all parties involved recognized the need to improve cost-containment as well as continuity and access issues in regard to care for UA athletes. Thus, MANA, Ozark and North Hills Surgery Center (North Hills is majority-owned by Washington Regional) established the “Partnership of Care” with assistance from the UA athletic department.

“The standard of care, and the cost, was exemplary,” said Dr. Rod Walters, a Hall of Fame trainer and sports medicine consultant based in Columbia, S.C., who evaluated Arkansas’ program in 2007.

In May 2007, in fact, UA representatives presented the department’s program at the SEC’s annual meetings in Destin, Fla.

“We were approached by trainers from practically every school in the SEC,” Shackelford said. “They wanted to know more about how we did things.”

Long was quick to point out the UA’s program only served men’s athletics. When the school’s men’s and women’s athletic departments merged in 2008, he said, installing a new program was a no-brainer.

“Certainly, as we came together we wanted to have the same level of care for all student-athletes,” Long said, “not one level for men and another level for women.

“The fact they presented is great. I would be very excited to present our new model as well.”

The new model, as outlined in the slides used during the December presentation, covers an array of issues. Some are cost-related, though Shackelford said the UA had been receiving “bargain-basement fees, steeply discounted fees that basically covered our costs.”

According to figures released by the UA, it was billed $1.3 million in medical expenses during the 2008-2009 academic year and paid $505,197 in out-of-pocket expenses. A UA spokesman said medical payouts from previous years are unavailable.

Long said better rates secured through the new partnerships should result in a lower payout, but he stopped short of guaranteeing any savings. He said the rates “are better, but whether we’ll save money from one budget year to the next is hard to say because it’s based on the amount of injuries and surgeries and things like that.”

Interestingly, the UA chose to retain MANA as its primary care provider after exploring other options. Shackelford said MANA will not pay any advertising or sponsorship fees and will not receive any special marketing recognition.

Instead, MANA personnel involved with the deal will receive an unspecified amount of credit with the Razorback Foundation and a number of complimentary tickets to events comparable to what they received in the past. MANA also is allowed to use the Razorback logo in conjunction with its own.

That’s far from the type of agreement Shackelford said Gribble pitched in December, when the $450,000 total was introduced. At that time, Shackelford said Gribble intimated similar health care providers in Chicago “lined up” to sign such deals with Major League Baseball’s White Sox.

“Ryan,” Shackelford said to Gribble at the time, “this ain’t Chicago.”

Representatives from Ozark and Washington Regional felt similarly. While refusing to meet the sponsorship request, the “Partnership of Care” members submitted a six-page proposal to the UA.

The proposal, dated Jan. 15, 2009, was obtained by ArkansasSports360.com as part of the aforementioned documents. It appears to address all of the changes requested by the UA, with a couple of notable exceptions.

While Ozark’s Dr. John Park was designated as the head orthopedic physician for the UA football team, the proposal requested Coker or Dr. Andrew Heinzelmann be allowed to fill in for Park if schedule conflicts prevented him from attending all road games. Ozark’s proposal also failed to guarantee an on-campus clinic — in addition to scheduled football-related clinics — one night a week.

Still, Ozark officials didn’t believe those areas to be big stumbling blocks. Because of their willingness to work on reasonable resolutions to those issues, and due to its long history with the department, Coker believed Ozark had put together a rock-solid plan.

“We thought we had agreed with everything they wanted on the health care side,” Coker said.

Parting with Partners
According to the documents obtained by ArkansasSports360.com, Long met with at least one official from Ozark on March 10 to discuss the two sides’ differences. On April 30, Long sent Pat McAnally, Ozark’s clinic administrator, an e-mail indicating the UA might be moving in a different direction.

In the e-mail Long wrote “that certain items contained in our initial proposal, while initially open for discussion, are indeed aspects of care that we feel must be addressed as we move forward as a combined athletic department.”

Long also asserted that potential sponsorships will be discussed separately, contrary to what was presented in December. Multiple sources indicated Long began to backtrack on the original sponsorship proposal due to backlash from members of the medical community after word leaked out following the December meetings.

Also, by the time of Long’s e-mail to McAnally, he had received a proposal from Russ Greene, CEO of Physicians’ Hospital. The proposal, also obtained by ArkansasSports360.com, addressed the same issues as the one submitted by the “Partnership of Care” group, including “priority status for in(-)office appointments and evening clinics at the U of A Athletic Department as requested.”

The Physicians’ proposal also indicated two orthopedists, Arnold and Dr. Terry Sites, would be available to work with the UA football team. Arnold said the agreement includes the participation of all four orthopedists in weekly on-campus clinics.

In the End
Coker expressed predictable disappointment following the UA’s June announcement.

“The U of A is free to do what they want, and we’ll carry on,” he said. “We’ll be here for athletes just like we always have, whether it’s high school athletes or former Razorbacks that are professionals and still come back to us.”

Even Shackelford, a lifelong Fayetteville resident, seemed disheartened by the process.

“I’ll still go call the Hogs, but it’s just a different flavor than what it has been,” he said.

Walters issued a more ominous warning, not just to Arkansas, but to any client mixing sponsorships and health care: “We want to make sure we’re not taking the money and running and giving subservient care to the athletes.”

Long bristled at that idea, and said the old agreement resulted in “a level of care not the same as our competitors.”

Asked if he would change anything in the December presentations that began the undoing of the longtime partnerships with Ozark and Washington Regional, Long paused.

“No,” he said, “I don’t think so.”