Hopkins hospital chief to quit in fall Block's position would be downgraded in reorganization

THE BALTIMORE SUN

Dr. James A. Block, president of the Johns Hopkins Hospital, says he intends to step down by fall -- his job diminished by a major reorganization of the East Baltimore medical complex.

Block says his likely departure is the natural consequence of a restructuring that essentially places the hospital under the Johns Hopkins University. Because the move puts the university's School of Medicine and the hospital beneath a single official, it significantly reduces his authority.

Hospital trustee chairman George Bunting said the medical "czar" is expected to be named by early fall and will likely hold dual titles: dean of the medical school and chief executive officer of the hospital and health system. This person will report only to the president of the university and a new committee made up of a select group of hospital and university trustees.

"I made it clear from the beginning that I did not consider myself a candidate," said Block, whose current title is president and CEO of the hospital and health system. In an interview, Block said that he was not forced out and that he retained the trust of many of the chairmen of the medical school departments.

"In my particular case, I have the managerial and business experience but not the academic experience" to become the senior medical official, Block said earlier this week. "It made sense for me to seriously consider looking at other options." Block's five-year contract does not expire until May, but he said he expects to leave Hopkins considerably earlier.

Block, 55, is a commanding and patrician leader who served as an early adviser to the Clinton White House. He significantly improved the hospital's finances and helped make it more competitive in the new era of managed care.

Hospitals across the nation are facing sharp reductions in revenue from government programs and insurers, sending administrators scurrying to cut costs and increase the volume of patients.

But some Hopkins officials and physicians say that several senior trustees encouraged Block's departure to placate riled medical professors who believed that academic values were under assault from Block's market-minded reforms.

Many trustees and officials play down the importance of internal conflicts at Hopkins.

"If you looked at a drop of water under a microscope, you'd never drink it -- you'd see all the microbes crawling around," Hopkins trustee A. B. Krongard said. "It's the same at Hopkins. When you step back, you see the greatest medical institutions in the world."

Needed restructuring

In creating the new administrative structure, trustees made it impossible for Block to continue without accepting a significant demotion. It is not clear whether the change was, as Block's critics maintain, a device to force him out, or was simply the result of a much-needed administrative restructuring.

"There has been no public announcement, while at the same time there is a private recognition that the deed is done," a senior university official, who declined to be identified, said in describing the conditions under which Block felt compelled to leave.

"The handwriting was on the wall as soon as the board of trustees decided that the new dean would be head of the hospital," said Dr. Neil Miller, a professor of ophthalmology, neurology and neurosurgery.

The issue remains touchy. Said H. Furlong Baldwin, the former hospital trustee chairman who hired Block and is his strongest backer, "I don't have anything to talk to you about."

William R. Brody, the university's president-designate, will take office Sept. 1, and several other senior medical positions will not be filled until after his arrival.

Block was brought to Baltimore in 1992 in large measure to assure the solvency of the hospital as the financial realities of the health care market began to change dramatically.

As long as there was enough money, Hopkins doctors said, administrators could carry out the conflicting missions of running a hospital profitably, educating future generations of physicians and conducting cutting-edge research.

Medical mission upheld

Tensions have flared into the open in recent years, even as the Hopkins hospital continues to run at a significant profit. By announcing that they would place the hospital under the university president and a medical chancellor, Hopkins trustees are attempting to show that the medical research mission would not be compromised.

"If you look at Hopkins' real strength, it's got an awfully good hospital, but what's unique about Hopkins is the academic aspect," said Dr. Lenox D. Baker Jr., a university trustee. Hopkins conducts more than $250 million in federally funded projects, more than any other medical school in the country.

Block clashed repeatedly, in style and substance, with some university officials, particularly the former medical school dean, Dr. Michael Johns, who left Baltimore for a senior medical post at Emory University in Atlanta earlier this year. Among the thorniest issues: whether the Hopkins name, revered in medicine around the world, was being cheapened by the drive to embrace nonfaculty physicians who could steer patients into the fold.

"It's fair to say that morale is lower," said Dr. Timothy Townsend, the hospital's former vice president for medical affairs. "Whether that has to do with Dr. Block or what is happening in the world, it's almost impossible to say. Where the marketplace says you've got to downsize and run leaner and smarter, morale is going to suffer."

Missed meetings

Grievances against Block are often described in vague terms, and few people knowledgeable about events leading to his departure were willing to talk for the record. But much criticism focuses on the widespread perception that Block failed to show sufficient regard for the culture of Hopkins and the people who work there.

Doctors and administrators said Block showed mastery of complicated subjects. But some colleagues said that he tended not to read written reports and that he frequently canceled or missed scheduled meetings.

That practice extended even to a pair of formal occasions early in his time as hospital president. A former senior Hopkins official held a formal dinner in Block's honor. Block did not appear, although he later explained that he had confused the date. But he also did not attend the going-away party for former Nursing School Dean Carol Gray, where he was scheduled as a featured speaker.

Block said The Sun has inflated his differences with Johns, the former medical school dean, and he insisted that his relationships with faculty members have been cordial. As an example, he said five faculty chairmen recently walked into his office and asked him to stay.

Fears for reputation

Urology chairman Dr. Patrick Walsh, who was one of the five, confirmed Block's account. Walsh, too, insisted that the restructuring of the medical complex was an effort to unite the medical school and hospital under one central authority -- not to exclude Block.

But Walsh acknowledged that many faculty members are concerned that Hopkins' efforts to compete by affiliating with other hospitals and doctors will cheapen the its name and lessen its aura. Walsh noted that academic hospitals across the country face the same problem.

"All of a sudden, the department chairmen are being asked to anoint their equivalents who are in all these distant suburbs," Walsh said. "Are these doctors going to be Hopkins doctors? Can we say that you don't need to go to Hopkins anymore to get Hopkins medicine? They are not the same quality. Let's face it."

Block's drive to push Hopkins into the new medical marketplace was perhaps most evident in his 1994 lawsuit aimed at breaking an agreement forged by his predecessor, Dr. Robert Heyssel, with Prudential Insurance Co. The 1991 sale of Hopkins' HMO to Prudential required Hopkins not to compete against the company for a decade, and its restrictiveness apparently caught Block by surprise.

In a settlement, Block and Baldwin dropped the suit and signed a statement retracting a series of allegations against a former Hopkins official who took a job with Prudential, saying that the charges had no basis.

Many Hopkins officials and physicians were stunned that the two men would pursue such personal allegations against a former colleague without facts that would stand up in court. And loyalists to Heyssel were angered that Block would so publicly repudiate a contract agreed to by his predecessor.

Profits increased

Block, a pediatrician and longtime administrator, earned more than $860,000 in salary, bonus and deferred compensation for the year that ended June 30, 1995, the most current tax records available show.

Since 1992, when Block arrived from University Hospitals of Cleveland, the 1,000-bed Hopkins hospital has substantially increased profits, added an outpatient center at the Greenspring Station in Lutherville, and maintained the hospital's No. 1 ranking by U.S. News & World Report.

This summer, Hopkins affiliated with Suburban Hospital in Bethesda -- a move aimed at expanding its patient base in the Washington area.

Block was, Neil Miller said, "brought in to do a very specific job, and that's to turn around the hospital. He did it in a very CEO-like style."

Pub Date: 8/03/96

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