Officials declined to share details of their negotiations with Universal Health Services over ending GW’s financial ties to the Medical Faculty Associates after University President Ellen Granberg teased the discussions earlier this month.
Granberg at a Faculty Senate meeting earlier this month said GW is negotiating with UHS, GW Hospital’s owner and operator, in an attempt to end its financial support for the MFA — which has amassed more than $400 million in debt to GW and other entities since GW took the reins in 2018 — marking the first time officials publicly disclosed efforts to cut financial ties from the medical enterprise. A University spokesperson has since declined to comment further on the details of the negotiations, including when they began, when the parties expect to conclude talks and whether GW has engaged external consultants, like lawyers or financial advisors, though Granberg said officials expect to provide a “substantive” update on negotiations at October’s Faculty Senate meeting.
University spokesperson Julia Garbitt earlier this month said officials, UHS and the MFA were working to chart a “sustainable path forward” for all parties to eliminate the University’s financial support for the medical enterprise.
“Our goal is to ultimately eliminate GW’s financial support of the MFA to cover its operating losses while preserving high quality medical education and health care for the communities we serve,” Garbitt said in an email in mid-September.
The negotiations with UHS suggest GW is planning to restructure its relationship with the MFA for the third time over the last 30 years, which most recently included GW bringing the MFA — who had operated as an independent entity — under its governance in 2018, giving the University control of its budget and leadership. The negotiations with UHS also further entangle the University with the health care management company, which became the sole owner of GW Hospital in May 2022 after the University sold its remaining 20 percent stake.
As of early July, UHS and the MFA were also continuing negotiations surrounding an agreement regarding the MFA’s staffing of Cedar Hill Regional Medical Center GW Health, which opened in April and is also operated by UHS.
UHS and the MFA also settled a lawsuit in July that the medical enterprise filed last year over allegations that UHS “properly withheld” Medicare reimbursements from the MFA.
A University spokesperson declined to comment on why officials would potentially deepen their relationship with UHS with a restructuring of the MFA given legal disputes between UHS and the MFA and ongoing negotiations surrounding the Cedar Hill hospital and whether GW’s current University-wide financial strains have played a role in officials’ decision to change their financial support for the MFA.
Officials pledged that the MFA would break even in FY2023 and FY2024, even though the medical enterprise would accrue $65 million in debt in FY2023 and $107 million in FY2024. Officials in October 2022 pledged the MFA would break even by June after GW sold its 20 percent minority stake in the GW Hospital for $54 million to help direct clinical revenue to the MFA, which partially staffed the hospital.
At the time of the sale, the MFA was $200 million in debt, and faculty senators doubted officials would follow through on their plans to break even.
MFA CEO Bill Elliott started his tenure in May 2024 with an aim to direct the medical enterprise’s day-to-day operations and instill financial stability. He outlined the efforts he’s taken to support the MFA at a Faculty Senate in March, including increasing patient access, lowering wait times and renegotiating cleaning and real estate contracts to help grow the practice’s revenue.
Over the 2024-25 academic year, officials continuously said they were making progress on the MFA’s finances but did not publicly disclose specifics and timelines for their efforts to end the medical enterprise’s financial reliance on the University. At a January Faculty Senate meeting, Granberg said the MFA’s financial losses were “unsustainable” and that the solution to its debt was “not a quick one.”
“There is movement, and I do see that we’re going to be getting toward a resolution of some type in the next few months,” Granberg said at the January meeting. “I just can’t talk about the details of it right now.”
In March, when faculty senators pressed Chief Financial Officer Bruno Fernandes and Elliott on a firmer timeline to resolve the practice’s persistent losses, Fernandes again indicated they could not provide a substantive update but said they were “much closer” to finding a solution than they were several months ago.
“I wish I could, but I can’t,” Fernandes said in March. “But I will tell you that when we do have that information, we will come to this Faculty Senate meeting and provide an update. At this point, we’re not prepared to be able to do that.”
Phil Wirtz, a faculty senator who has been outspoken about his concern relating to the MFA’s debt, said at a Faculty Senate meeting in May the administration’s silence on the MFA’s persistent losses over the 2024-25 academic year puts the Faculty Senate in an “extremely awkward position” because it raises the question if the Senate has confidence in officials and the Board of Trustee’s ability to solve the financial losses.
“What we keep hearing is ‘we’re working on it, we’re working on it,’ but it’s now reached the end of the academic year, and it seems to be a continuing mantra, which is having a dramatic impact on the affairs of the University,” Wirtz said at a May Faculty Senate meeting.
