Toxic mix: Secrecy and KMSF millions

The reason for creating the Kentucky Medical Services Foundation made sense.

Constrained by the University of Kentucky’s pay scales, its new College of Medicine was having trouble recruiting talented physicians to teach and work there. Following a model common elsewhere, UK administrators set up KMSF to collect physician fees paid for patient care and use them to boost doctors’ pay as well as to support other worthwhile endeavors at UK.

Flash forward 40 years and, as Linda Blackford reported Sunday, KMSF has grown into a hulking $200 million entity with widespread interests and investments, a very self-contained oversight system and a penchant for secrecy.

No one on the outside knows quite what goes on inside KMSF, how decisions are made about spending, whether on physician pay or private airplanes. Blackford obtained some documents from KMSF — although it contends it is not obligated to provide them — and obtained others through court records and tax filings. But who knows what KMSF is choosing not to tell? KMSF does not even answer to the UK board of trustees.

There are two big problems with this, both anticipated by the open-records laws that require public entities to do their business in public.

First, even if the people calling the shots right now are doing everything just right, there’s no assurance their successors will be as honorable.

Second, Kentucky history, indeed human history, warns that large sums of money paired with secrecy often creates a toxic result.

That’s why it’s so important to have transparency in public business — be it state government spending, public pension investments or the actions of KMSF.

The foundation was created by UK, a public institution. UK employees either occupy or choose all the spots on its board of directors. KMSF advises the dean of the college on pay levels for UK faculty. Remarkably, despite all that, UK and KMSF claim it’s a separate, private entity exempt from the open-records laws.

KMSF not only refused an individual’s open-records request, prompting an appeal to the Kentucky Attorney General’s office, the foundation blew off the AG’s request for information. The AG ruled that KMSF is a public entity and subject to open-records laws, a ruling KMSF is challenging in circuit court.

UK and KMSF also cite patient confidentiality as a reason for the secrecy. However, most requests are about decision-making within the foundation and financial machinations, and those that involve patient care can be addressed by redacting information that could identify patients individually, as law requires.

KMSF’s defenders cite the role it has played in the expansion of UK’s medical enterprises, providing thousands of jobs and tens of millions in construction spending. That’s good, they seem to argue, and so everyone should stop asking questions.

It is good but that’s all the more reason to ask questions. In the long run secrecy can only damage this critical institution. Leaders at UK and KMSF do not serve their institutions or the public interest by pulling the cloak ever more tightly around their actions.

Lexington Herald-Leader

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