WISCONSIN LEGISLATIVE AUDIT BUREAU
AUDIT SUMMARY
Report 01-12
June 2001
University of Wisconsin Hospital and Clinics Authority
1995 Wisconsin Act 27 created the University of Wisconsin (UW) Hospital and Clinics
Authority as an independent, nonprofit public entity on June 29, 1996. The Authority
operates a 536-bed teaching hospital, a number of clinics on the UW-Madison campus,
and other outpatient clinics and facilities in the Madison area. In fiscal year
The Authority and UW-Madison Have Complied with Their Agreements
Act 27 required the Authority to enter into several agreements that define the
relationship between the Authority and UW-Madison. These agreements help ensure the
Authority continues to support medical education at UW-Madison, and allows the Authority
to lease a portion of the Clinical Sciences Center, which contains the UW Hospital, and
other on-campus facilities the State owns. Significant ongoing cash transfers between
the Authority and UW-Madison occur as a result of these agreements. In
The Authority Has Undertaken an Aggressive Building Program
Since 1996, the Authority has used its statutory ability to issue bonds for any purpose to undertake an aggressive building program. It has issued $106.5 million in bonds, the full limit allowed by statutes, to finance a number of projects, such as construction of the UW Health-East Clinic and UW Health-West Clinic in Madison. These two projects total 235,000 square feet.
The Authority and several other health-related entities collectively use the name UW
Health for marketing and public relations purposes. UW Health is a registered trademark
of the Board of Regents, which has granted the Authority and other participating parties,
including UW-Madison and the UW Medical Foundation, a royalty-free license for its use.
These parties collaborate in the delivery of patient care, health care education, and
research. UW Health also includes several nonprofit, tax-exempt corporations, including
University Health Care, Inc. and University Community Clinics, Inc., that assist in
networking activities, including purchasing and developing local and regional physician
practices. In
The Authority’s Financial Performance Has Been Mixed
To continue its mission of providing high-quality health care and supporting medical
education, the Authority must maintain a strong financial position. Like academic medical
centers nationwide, the Authority’s financial performance has been mixed. Revenue in
excess of expenses, or “profit,” declined from $13.8 million in
During the Authority’s first four years, various measures of operating performance, such
as the number of inpatient admissions to UW Hospital, were positive. For example, annual
inpatient admissions increased from 19,247 in
The Authority’s mission is to deliver comprehensive, high-quality health care, including
charity care to the indigent; provide a suitable environment for medical instruction;
sponsor and support health care research; and conduct outreach activities. The Authority
is generally fulfilling its statutory mission. For example, in
The Authority Has Had Difficulty Employing a Sufficient Number of Nurses
The Authority has considerable flexibility in personnel management, which addressed many
concerns that were raised before its creation. However, while the Authority was able to
promptly negotiate three of its four union contracts for
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