LETTER TO THE EDITOR: WKU shouldn’t rush with Request for Proposal

Drs. Craig Beard and Phillip Singer, Western Kentucky Orthopaedic & Neurosurgical Associates

We love our Hilltoppers here in South Central Kentucky, and the idea of building them a state-of-the-art indoor sports facility would normally bring the region together in harmony. The manner in which WKU has approached this concept, however, has deeply divided the community, and worse yet, threatens low-cost, high-quality access to health care services for the region.

Last month, President Gary Ransdell announced that he had reached a secret deal with the Medical Center: In return for constructing a $22 million sports facility on campus, The Medical Center would potentially receive 99 years of exclusive rights to provide health care services to WKU students, faculty and staff. To be clear, this was no “gift”; The Medical Center would have reaped significant profits, while WKU would likely assume the risk of significant debt liability in the case of financial default.

The deal generated significant concern among many of the WKU Board of Regents, and the proposal just squeaked by on a 6-4-1 vote. The administration had less luck with the Kentucky General Assembly; on Sept. 20, Democrats and Republicans on a legislative panel questioned the decision to proceed without a more transparent process. Given their concerns, Ransdell withdrew the Letter of Intent with The Medical Center from consideration and committed to follow state procurement laws when reevaluating the project.

Promising to rush through the project, WKU issued a new Request for Proposal just one week later. Unfortunately, little has changed. With most of the same terms as the original Letter of Intent, as well as a vague scoring system that allows the Administration wide discretion on selecting a winner, the new process appears rigged to simply formalize the original deal under the guise of competitive procedures.

Ultimately, WKU’s proposal is bad public policy, and it potentially violates federal law.

Monopolies in any context are bad for consumers. Imagine if a gas station owner “gifted” WKU with a building in exchange for a 99-year requirement that all faculty and staff purchase gas from its stores, regardless of price or quality. We’d naturally expect gas prices to rise and gas quality to decrease.

In health care matters, exclusive deals threaten the very fabric of the community. Health care monopolies result in fewer providers, less patient choice, less innovation in care and eventually higher costs to patients and employers.

In defending this deal, WKU officials have promised that no one will lose their current choices and coverage. But that promise is inherently contradictory with contractual exclusivity: inevitably, students, faculty and staff will face higher costs –– if not service denials –– to seek their trusted medical counsel off campus and/or outside of the preferred, exclusive provider network.

Indeed, the very day after the original Letter of Intent was formalized, WKU already tried to commence the process for restricting choices. On Friday, Aug. 19, Ransdell informed physician groups –– that had faithfully supported the community and university for 80 years –– that their services would be terminated under the new deal; and later, they were intentionally excluded from the network of physicians who would be available for WKU care.

As a matter of federal law, this kind of arrangement may not be permissible. The federal Anti-Kickback Statute prohibits giving anything of value, with the intention of inducing referrals of business, that is payable in whole or in part by any federal health care program. Our own state laws contain similar prohibitions. With many students, faculty, staff and their families using Medicare and Medicaid, WKU must be vigilant to avoid this kind of liability.

For all of these reasons, we have submitted a letter of protest to WKU and the state’s Finance Cabinet to block this Request for Proposal. Understand that we have no intention of blocking or delaying the construction of a sports center. Rather, our letter is another effort to urge WKU to proceed in a manner that is best for all on campus and the broader region:

First, convene a public process that involves all segments of the WKU and Bowling Green communities to develop a solution that helps our sports teams without impairing health care choices for our citizens. And second, issue a new set of Requests for Proposals that individually bid out each service to spur real competition and best protect the taxpayers’ interests.

While we share the community’s passion for sports and understand the University’s urgency to support its teams, we strongly recommend the Board of Regents take a more deliberate approach on this project to fully consider the needs of all stakeholders and protect WKU’s choices for the next 100 years. We can figure out a way to build a new sports center, but not on the backs, wallets and health care needs of WKU students, faculty and staff.