Business
3:47 pm
Wed March 12, 2014

DePasquale Launches Audit of Pittsburgh Hospital Research Programs

Pennsylvania Auditor General Eugene DePasquale has announced his office will perform audits of five healthcare research programs across the state including, Pittsburgh’s Magee-Women’s Research Institute and Children’s Hospital of Pittsburgh.

DePasquale will investigate whether the programs funded by the Commonwealth Universal Research Enhancement Program (CURE) are using the money as intended. Funding for CURE comes from the landmark tobacco settlement of 1998, which provided Pennsylvania with roughly 300 million dollars annually for state health care needs through 2025. Nearly three-quarters of those funds are currently threatened by an arbitration ruling that could cause huge cuts to the state budget.

Tobacco companies involved in the agreement requested arbiters to ensure 15 states were following the terms of agreement by leveling the marketplace so other tobacco companies would not gain a competitive advantage. Arbiters found in 2003 that Pennsylvania and five other states had not met the requirements of the agreement resulting in the loss of 60 percent of its settlement funds next year. Last week, Pennsylvania’s  Attorney General appealed the decision.

DePasquale says if the state’s appeal is denied, these cuts to settlement funds are going to be a problem for the state economy in the future.

“There is a broader concern, if this arbitrator’s decision is upheld by the court system Pennsylvania’s out at least 200 million dollars, that money is already being counted on in the current state budget,” DePasquale said.

CURE currently receives around 13.6 percent of the tobacco settlement funds. Over the last 12 years, CURE has distributed 797.5 million dollars in grants to 1,900 research projects across Pennsylvania for a broad range of healthcare problems.

According to DePasquale, the economies of the commonwealth and the region are dependent on these funds, and it is critical to ensure that they’re being used correctly.

“Health care and education are the main drivers of the economy of Southwestern Pennsylvania and these dollars help drive a significant amount of that economy,” said DePasquale.

Both Magee-Women’s and Children’s Hospital are affiliates of UPMC which raises other concerns for state auditors. According to DePasquale, there are some worries that the tobacco settlement funds given to UPMC are being used in their PR war with competitors.

“This issue between UPMC and Highmark, and the ads and all that other stuff people got to have confidence to know that the money that is taxpayer dollars, that is legally required to be spent on healthcare outcomes, that that’s what’s happening,” said DePasquale. 

If there are misuses discovered by the audit, the allocation of funds will be reviewed and programs will receive a list of recommendations. The Pennsylvania Department of Health is then responsible with enforcing any changes going forward.