Saturday, Feb. 10, 2007 | 7:10 a.m.
In an abrupt about-face, University Medical Center will allow other cancer specialists to compete for a contract held by Dr. John Ellerton that has become the latest controversy at the troubled hospital.
Ellerton's contract came under scrutiny after the Sun revealed Jan. 24 that despite his role as chief of staff - the elected voice of UMC doctors to administrators - he was given $230,000 annually by ousted hospital boss Lacy Thomas to be UMC's medical director, performing hospitalwide administrative duties. Thomas is now under criminal investigation for allegedly handing out contracts involving little or no work to his Chicago friends.
The Ellerton deal blindsided UMC doctors who elected him chief of staff. The arrangement - which essentially pitted him against himself - is an unprecedented and blatant conflict of interest, according to several current and former chiefs of staff at UMC and other local hospitals.
Earlier this week, Kathy Silver, UMC's interim chief executive, proposed a new contract for Ellerton to eliminate the conflict of interest. Ellerton would be stripped of his hospitalwide administrative duties but allowed to keep the pay boost, which came on top of his $120,000 salary to direct the hematology-oncology department.
The deal would give Ellerton $350,000 to run the hematology-oncology department, and also allow him to bill patients for services. That would be a gross overpayment, according to oncologists who reviewed the contract. They recommended UMC allow other cancer specialists to compete for the work.
Silver took that advice Thursday, after reading the Sun's report that day detailing the proposed contract.
"The story piqued my curiosity, I have to be honest with you," Silver said. "The story created at least a perception for me that there was interest in the community."
Ellerton could not be reached for comment Friday. Silver said he was "very disappointed" with her decision.
"He didn't feel there was a reason for the hospital to look at other options," Silver said.
"Again, we've got to take the focus off Dr. Ellerton. It's the process."
Commissioners have repeatedly said that events at UMC over the past year show a need for more transparency and accountability. Those events include Thomas' withholding of financial information from commissioners and the fact that the hospital lost more than $34 million when he had previously reported the sum was $18.8 million.
Chief among complaints from hospital critics is the slapdash way that the hospital awards contracts. Administrators sometimes issue formal requests for proposals to ensure they get the best service at the best price. Other times, they skip the competitive process.
Silver said her supervisors have proclaimed "loud and clear" that more openness is necessary at UMC.
Letters to solicit proposals will go out to oncologists in the coming week, she said.
Silver said UMC also will seek competitive proposals for the hospital's kidney specialists.
UMC is not dissatisfied with either group providing the specialty services, Silver said.
Susan Brager, one of two new members on the Clark County Commission, praised Silver's decision.
"I think that the more transparent we are, that's how comfortable the community can be that we want to do what's in the best interest of everyone involved," Brager said.
Chris Giunchigliani, the other new commissioner, said Ellerton's contract is a good opportunity to put out a request for proposals.
"It would put people's faith back into UMC," she said. "Dr. Ellerton's an excellent doctor. He was my father's oncologist several years ago, but I still think it would be the right way to go."
A transparent and competitive process for Ellerton's contract would eliminate questions about quality of care and the way people are awarded contracts, Giunchigliani said.
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