Officials said Medical Faculty Associates Board of Trustees Chair Ellen Zane exited the room in 2019 when an MFA board committee deliberated and voted to hire Savista, a revenue cycle manager whose board Zane sits on.
Secretary of the University and Vice President for Board Relations Jonathan Post said based on his “review of the record,” Zane — who serves on the Board of Directors of Savista — left the room during the MFA board’s Finance, Audit, Risk and Compliance Committee meeting in November 2019 when the group considered the selection of an outsourced revenue cycle manager. The detail was included in additional information about the MFA trustee conflict of interest policy, Zane’s recusal from the decision to sign a contract with Savista and the other contenders for the contract that GW officials and trustees sent The Hatchet last Friday.
GW had not previously shared details about which other vendors the MFA considered other than Savista or what the MFA’s trustee conflict of interest policy included.
Post said “management” presented several potential revenue cycle management contractor vendors to the committee, including Savista — then called nThrive — Parallon, Conifer and Navigant, now known as Guidehouse. He said the committee voted unanimously in favor of Savista.
“Based on an analysis that assessed a variety of considerations, including capability, industry experience, technology and financial considerations, the committee approved the selection of nThrive (now Savista),” Post said in the letter. “The minutes reflect that Chair Zane was recused.”
Post said the remaining members on the committee who voted in favor of Savista’s contract had no conflict of interest “with respect to” the selection process. He said Zane annually receives a “management letter” directing her on the steps she must take “in light of her conflict,” which includes recusing herself from any board or committee discussions that involve the MFA’s relationship with Savista.
He said the MFA’s Executive and Compensation Committee is reminded of Zane’s “conflict” by compliance staff on an annual basis as part of its MFA Trustee Conflict of Interest oversight.
The MFA does not publicize who serves as trustees for the organization, but its public tax forms show that 16 members sat on the board in Fiscal Year 2020 when Savista’s contract was approved including former GW Board of Trustees Chair Nelson Carbonell and former GW Chief Financial Officer Mark Diaz.
Post said Zane “consistently disclosed” her relationship with Savista during her service on the MFA’s board, including prior to the MFA’s consideration of doing business with Savista. University spokesperson Shannon McClendon said earlier this month that Zane disclosed her position on Savista’s board of directors and was recused from the MFA board’s vote on whether to retain the company.
The MFA’s Trustee Conflict of Interest Policy, which the University also shared with The Hatchet last week, states that the MFA board delegates the oversight of conflicts of interests among trustees to its Finance, Audit, Risk and Compliance Committee.
It is up to the Finance, Audit, Risk and Compliance Committee to formally determine whether the existence of a trustee’s financial interests are a conflict of interest, per the policy.
The policy states that a financial interest is “not necessarily” a conflict of interest, and that in order for the committee to formally recognize such an interest as a conflict, a trustee must disclose their financial interest in writing, which would enable the committee to evaluate the matter and determine by majority vote whether a conflict is present.
The policy also states that any trustee who has a financial interest may recuse themselves from any relevant decisions or discussions without going through the formal process for determining whether a potential conflict of interest exists, as long as the trustee has first disclosed said financial interest.
Post said Zane’s dual relationships between Savista and the MFA align with general practice in nonprofit governance. He said nonprofit organizations like GW and the MFA “spend time and attention” selecting and recruiting board members, and they seek members who have experience in the fields the nonprofit operates in.
Post said the University’s search for qualified candidates to sit on each respective board may lead to a member having personal or professional relationships that could conflict with, or appear to conflict with, their fiduciary duty — the legal obligation to act in the company’s best interest.
He said such potential conflicts are a “standard” in nonprofit governance and that companies have “well-established” rules and laws to abide by when handling a potential conflict of interest.
“With respect to the MFA, it is important that the board include members who have an understanding of, and experience with, clinical medical operations as well as academic medicine,” Post said in the letter. “Chair Zane has spent her career in health care and led preeminent academic medicine organizations.”
In addition to her roles at the MFA and Savista, Zane serves on the boards of several companies across the health care, financial and corporate governance sectors, including medical device manufacturer Boston Scientific, consumer financial services firm Synchrony Financial, orthopedic solutions company AgNovos Healthcare and blood management company Haemonetics, where she also chairs the board.
She is also a director of the National Association of Corporate Directors New England Chapter and serves as the lead director of Fiduciary Trust Company, a Boston-based wealth management firm, according to an online profile.
A 2015 study conducted by University of Pittsburgh researchers who studied 442 publicly traded healthcare companies found that 85 trustees — defined as individuals who held trustee positions for hospitals, medical schools or oversaw university boards of trustees — held a total of 93 healthcare company directorships.
The study also found that nearly one in 10 U.S. for-profit healthcare company directorships are held by academically affiliated individuals including academic leaders, professors and trustees from 85 major non-profit academic institutions.
Post reaffirmed McClendon’s previous statement that all MFA trustees complete an annual disclosure that identifies organizations with whom the trustee has a potential ownership, investment interest or financial interest “above a certain threshold.”
He said that when a situation develops where there is either a conflict, or appearance of a potential conflict, a “management plan” is developed to advise the trustee to recuse themself from any related discussions.
Vice Chair of GW’s Board of Trustees Mark Chichester, who also serves on the MFA’s board, said in a statement that GW and the MFA’s boards maintain conflict of interest policies that follow “widely recognized” governance best practices, and said all MFA trustees take the policies “very seriously.”
He said the conflict of interest policies are in place to ensure the MFA board is composed of individuals that are committed to the institution and have a “deep and broad” experience in terms of managing academic health care enterprises.
Pam Lawrence — a GW trustee who has also served on the MFA’s board since 2018, and sits on its Executive and Compensation Committee since 2019 — said in a statement that Zane’s affiliations have been disclosed and addressed “appropriately” throughout Lawrence’s service on the MFA’s Executive Committee.
“The MFA is fortunate to have Ellen’s unparalleled expertise and experience,” Lawrence said in the statement.
An internal ethics complaint filed by a community member two years ago outlined worries that Zane’s dual roles with the MFA and Savista “appear to pose” a direct and material conflict of interest.
