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Viewpoint: Alignment of Academic Medical Centers and Cities Is Key to Economic Growth

AAMC Reporter: January 2013

By Ricardo Azziz, M.D., M.P.H., M.B.A., Professor, Obstetrics, Gynecology, and Medicine, President, Georgia Health Sciences University, and CEO,
Georgia Health Sciences Health System

There is great symbiosis between medical schools and teaching hospitals and their communities. Medical schools and teaching hospitals and the universities they are part of often are among the largest employers in the locality, and serve as the health care safety net for the community. In turn, the community can support the mission and development of these institutions by facilitating infrastructure development and philanthropic support.

The smaller the community, the greater this interdependence. More than half (53 percent) of medical schools and teaching hospitals are located in cities with populations of no more than 500,000, and 36 percent are in cities of 250,000 or fewer. Academic medical center and city interdependence is magnified in these cities, making the health of the city greatly dependent on the well-being of the institution and vice versa.

The successful alignment among the medical school and teaching hospital, affiliated university, and its home city, particularly in smaller communities, will be paramount to achieving growth in this highly recessive and competitive environment. Faced with a similar set of circumstances, both academic medical centers and cities must find ways to navigate the “new normal.” Those able to cultivate relationships that mutually benefit both the university and the city will find that their institutions will not only survive through budgetary shortfalls, but grow.

The synergy results in greater economic impact and social benefit. Joseph Volcker, the first president of the University of Alabama at Birmingham, touched on this in a 1971 monograph following the consolidation of the university’s health sciences arm with the contiguous extension center, to create what is now one of the more successful academic medical centers nationwide.

Collaboration between medical schools and teaching hospitals and the host city furthers the growth of each in a multitude of ways.

Medical schools and teaching hospitals are often a city’s principal economic driver. In Augusta, the Georgia Health Sciences University, soon to be consolidated into Georgia Regents University, is the second-largest employer in the area, and the largest for salaries greater than $50,000 per year, injecting almost $2.1 billion annually into the city’s economy.

These institutions also attract residents (faculty, staff, retirees) with greater-than-average economic capacity. By supporting cultural offerings that enhance a community’s attractiveness to higher-income families, these individuals further support a city’s growth.

Universities and their medical schools and teaching hospitals serve as economic anchors, attracting new businesses. Companies seek out communities with robust health care and educational opportunities. Businesses and institutions of higher education partner to develop a trained and skilled workforce. Research universities generate new business in their own communities through innovation, discovery, incubator, and technology transfer programs.

In turn, cities can advance the success of the academic medical center and its university. They can ensure that universities have a voice in developing or acquiring property and facilities. Most city leaders understand that while nonprofit universities are tax-exempt, they spawn a wide variety of tax revenue-generating businesses around them.

Cities also can include their universities and academic medical centers in their branding and marketing efforts; in their public safety initiatives, particularly regarding patients and students; and in their planning and development strategies, such as creating venues and settings that faculty and students prefer.

In addition, cities can support medical schools and teaching hospitals by encouraging local philanthropists to rally behind the university’s vision, considering it a worthwhile and critical investment.

In optimizing synergy and alignment among an academic medical center, university, and city, we must first understand who the city and the university are and how they are managed.

Elected leaders who manage cities work closely with community, civic, and business leaders. Likewise, administrators at universities, medical schools, and teaching hospitals represent a close-knit community of faculty, students, staff, and alumni. Therefore, working with cities or universities requires careful consideration of the roles and positions of appointed leaders and staff, and of the communities themselves.

Second, leaders in cities and at medical schools and hospitals should be familiar with their counterparts’ roles and responsibilities and commit to building partnerships. While this may sound simple enough, understanding the business and priorities of universities and cities, respectively, is no small feat.

Cities, academic medical centers, and universities are complex ecosystems, subject to considerable internal and external political forces, with multiple stakeholders, heterogeneous needs, missions that transcend the purely commercial, and histories that require respect and consideration.

But the similarities end there. Cities aim to provide basic infrastructure—transportation, legal and emergency services, K–12 schools—to residents and local businesses.

Alternatively, universities transmit, develop, and preserve knowledge. In essence, their mission is to provide the best quality of higher education and, in the case of a research institution, the most relevant and cutting-edge discoveries possible.

Few academic leaders fully understand the complexities and nuances of city management. And even fewer city or community officials understand the needs and culture of academe. Frank dialogue, accompanied by a genuine desire to understand, is a good first step to furthering the alignment of cities and their universities.

Third, we must understand that the interests of a city and those of an academic medical center or university will diverge occasionally. These differences must be addressed proactively, maximizing opportunities for resolution and minimizing the potential for open conflict. At times, a university and city must simply agree to disagree.

In this regard, an ombudsman or leadership body with a sufficiently broad representation and delegated authority may further the partnership. Another good instrument to further university and city alignment is an intermediary body with members who genuinely support the partnership and want to maximize the success of both entities.

The power to create and unleash even more positive power through greater synergy and alignment is in our hands.

January 2013 Home

Ricardo Azziz, M.D.

Ricardo Azziz, M.D.