The University of Nebraska Board of Regents has asked the state attorney general to investigate Omaha-based Nebraska Medicine, citing concerns that some of the health system’s leaders may be attempting to interfere with the university’s proposed $800 million plan to become the sole governing member of the system, the Omaha World-Herald reported Jan. 12.
The governance shift stems from Clarkson Regional Health Services’ decision to exit its 50% stake in Nebraska Medicine, ending a joint leadership model that has been in place since 1997. Under the proposed transaction, the university would assume sole membership in the health system by acquiring Clarkson’s stake, along with related land and buildings, for a total of about $800 million.
Board chair Paul Kenney, wrote a letter Jan. 8 to Nebraska Attorney General Mike Hilgers alleging that certain Nebraska Medicine officers and board members engaged in conduct intended to undermine philanthropic and legislative support for Project Health — a roughly $2 billion campus redevelopment initiative at the University of Nebraska Medical Center. Mr. Kenney said the actions were intended to discourage the board of regents from moving forward with the governance change.
In a statement to Becker’s, the attorney general’s office confirmed it received Mr. Kenney’s letter and is reviewing the claims. Any investigation will remain strictly confidential, a spokesperson for Mr. Hilgers’ office said.
Mr. Kenney’s letter cited conversations that regents said occurred between Nebraska Medicine representatives and state lawmakers, including members of the Legislature’s Appropriations Committee. In the letter, Mr. Kenney wrote that the representatives “shockingly asked the legislators to reconsider appropriations to Project Health and to reduce future appropriations to the university,” according to the World-Herald.
Nebraska Medicine described the regents’ request as an attempt to shift attention away from unanswered questions about the proposed governance change and said the allegations have no merit.
“This is a direct effort by the Board of Regents to distract and take the focus off the very serious questions about their proposed $800 million takeover of Nebraska Medicine,” the system said in a statement to Becker’s. Nebraska Medicine added that it supports Project Health and “intends to work with local philanthropy to support this project.”
Nebraska Medicine has said it wants to maintain the current two-member governance structure and replace Clarkson with another local nonprofit member focused on the health system’s success. It has also raised concerns about how the university would finance the transaction and what the change could mean for Nebraska Medicine’s long-term governance and operations.
University officials have said Nebraska Medicine would remain a separate nonprofit under the plan, with its own board of directors, bylaws and budget, and would not become a state entity. A university spokesperson reiterated that position in a statement to the World-Herald: “The University will not touch Nebraska Medicine’s revenues. Our public statements on this have been clear and unequivocal.”
A vote by the board of regents on whether to move forward with the plan was originally scheduled Jan. 9 but was postponed by the university until Jan. 15, after a group of state senators asked the board to allow more time for public input. Regents have said they still plan to vote in favor of the proposal.
Editor’s note: Becker’s has reached out to the University of Nebraska for comment and will update the report if more information becomes available.
At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.
