AMC Financial Arrangements & Affiliations

Schools of medicine (SOMs) often rely on funds from affiliated hospitals to support their academic mission, while teaching hospitals rely on the services of school faculty and staff to serve their patients, manage their residency programs, and provide medical direction for hospital units and services. However, what each party expects and wants can diverge over the years, while the agreements governing the arrangement may remain unchanged. As a result, when either the hospital or the SOM – or today frequently both – faces a budget crunch, the recognition and understanding of what each is doing, and why, are important to the ongoing success of the relationship.

ECG works with the teaching hospital and SOM to document, rationalize, and revise the funds flow from the hospital to the school and the services that faculty and staff provide in exchange. We work with both parties to determine not just what is occurring, but what should be occurring – those services that the hospital finds valuable and wants the SOM to continue providing. Once these services are identified, we help to develop a payment methodology that appropriately reflects those services, incorporates the interests of both parties, and is flexible enough to adapt to changes in service requirements and to allow the hospital and SOM to update the arrangement over time.

ECG utilizes its broad experience with academic medical centers to inform each step of the process and to respond to the unique aspects of each SOM/teaching hospital relationship. We understand the services that are commonly needed at academic medical centers and the requirements to provide those services. Furthermore, we understand how to overcome one of the biggest challenges in structuring financial arrangements between SOMs and hospitals: collecting information about services at a level of detail that provides confidence to both parties without being overwhelming and unwieldy.

Whether structuring arrangements for the entire SOM or for a specific department, we leave the teaching hospital with the assurance that it is receiving value for the money it pays and the faculty with the assurance that they are receiving fair compensation for their services.

To learn more about the successes our clients have achieved, please see the following examples: