Huge advertising budget shows struggling UMC’s priorities out of whack

If ever a county hospital needed a public relations boost, it's the University Medical Center.

Talk about your prime image-makeover candidates.

With a $53.7 million projected 2008 budget deficit, dim prospects for improvement in the bottom line, and the scent of scandal from an ongoing police investigation of former CEO Lacey Thomas, the hospital's credibility is on life support.

If UMC were a patient, it would be in danger of flatlining and in need of a transfusion and transplant -- in its case, a cash transfusion and a business-acumen transplant.

To make matters far worse, ugly rhetoric has been wafting recently from UMC and Clark County management. The not-so-subtle message: The hospital's best medical services could close or be substantially trimmed if the public doesn't embrace the current bailout.

Frankly, such malodorous machinations are enough to make me retch.

UMC plays an essential role in Southern Nevada, and it needs to improve its image almost as much as its bottom line. But its biggest challenge is convincing skeptical taxpayers that its managers are competent and honest enough to handle the job.

Given that, it makes me wonder how a facility riddled with so many financial problems wound up sporting a juicy $4.3 million advertising budget for most of this fiscal year. To say such a hefty chunk of change might be better spent elsewhere only states the obvious.

Image is one thing; reality quite another.

Once questions started being raised recently about how the financially hemorrhaging county hospital might somehow justify such a big advertising budget, commercial air time was canceled. In no time, the budget has shrunk to approximately one-quarter of its previously approved size.

My, that was quick.

The sudden fiscal sobriety is all the more astounding given UMC's consistent financial problems. The hospital has suffered heavy losses for the past decade.

If advertising actually helps a county hospital, then UMC ought to be able to point to the positive results generated by that budget. But, of course, it can't really do that these days and keep the general public from laughing itself into hysterics.

Brown & Partners, which according to the secretary of state is owned by members of R&R Partners, has the largest piece of the hospital's advertising budget with $3.6 million in the current fiscal year. Brown & Partners' President Chuck Johnston is quick to note that the company came nowhere near to exhausting its budget and has recently canceled some advertising contracts.

UMC public relations manager Cheryl Persinger, who oversees the advertising budget, said her department has attempted to keep costs down. (In fiscal year 2006, the budget was $3.5 million with $2.4 million actually spent, $1.9 million of that through Brown & Partners, Persinger says. Brown & Partners is in the final weeks of a contract it's held the past five years.)

Persinger estimated that $1.9 million has been spent on television, radio and newspaper ads in fiscal year 2007, which ends June 30.

"I believe we got a lot for our money," Persinger says.

Johnston reminds the columnist that most of the budgeted money passes through the advertising company and winds up in the pockets of television and radio stations and a certain daily newspaper, which will remain nameless.

"UMC is in an extremely competitive market going up against big corporate-owned hospitals that spend millions each year promoting their services," Johnston says. "For UMC to attract paying patients, we need to make the public aware of the services UMC offers."

Although officials say the advertising budget was increased following the recommendations of a citizens oversight committee after the last UMC financial debacle, no one seems clear on why it has risen so steadily from $1.9 million five years ago while the percentages of collections and insured patients have plummeted.

For those of us who believe UMC shouldn't be spending money it doesn't have on image-making that isn't working, the good news is the advertising budget is due to be whittled to about $1.2 million in the coming fiscal year.

And here's a little free advice: Stop playing politics with sick people. Don't use disabled kids and burn victims as human shields.

The fastest way to improve your image isn't with a TV commercial or print advertisement.

It's with a consistent display of fiscal sobriety and a track record of competent management and oversight.

John L. Smith's column appears Sunday, Tuesday, Wednesday and Friday. E-mail him at Smith@reviewjournal.com or call 383-0295.