Tuesday, October 30, 2007

OHSU - Oregon Hospital Scam Unreported

This is so typical.

Dr. Peter Kohler, former head of OHSU, sold this city a bill of goods. He talked of 10,000 new biotech jobs if the city went through with plans to build the tram and the shrine at South Waterfront, and if Oregonians approved the $200 million bond to finance OHSU's research expansion.

Lots of us knew it was total BS. BrainstormNW Magazine even wrote a cover story exposing the fraud. But the Funny Paper cheerled as usual, and barely even noticed when not a single actual biotech job ever surfaced.

Now, four years later, we read in the Funny Paper that OHSU is losing money fast, and that the Chief Financial officer has been warning for years that a "financial meltdown" was likely. Yet during this entire time, OHSU continued to push ahead on a $60 million tram, a new office building at SoWhat, the $200 million bond, and a new research center on the Schnitzer property.

Kohler, of course, is long gone. He knew when to get out. They papered over their cash flow losses by selling the Oregon Graduate Institute propery - a great way to make ends meet. Kohler escapes after running the place into the ground, but not before accepting all his awards and getting a building named after him.

Where was the Funny Paper when Kohler predicted that he could goose up research grants enough to cover his profligate spending? OHSU was in the red for years, and they kept the pedal to the metal on spending, cannibalizing their capital assets to cover the losses.

Go read that Brainstorm story. Every single element of the OHSU scam was debunked. Local venture capitalist Ralph Shaw is quoted extensively in the article, challenging the specifics of what OHSU was claiming. He was summarily dismissed, by all the OHSU brass, the PDC brass, and all the polticians. "Too negative." "Skunk at the party."

No one actually addressed his very specific criticisms, of course. He knows so much more about all this stuff than those idiots that they would never take him on on specifics. You get quotes like Jim Francesconi: "Ralph’s defining the problem, but I need some solutions.” That doesn't mean anything - the "solution" is to not spend a billion public dollars on a foolish investment!

And all along the way, from the Funny Paper, not a whisper. It's not as if it was hard to figure out. Brainstorm had the story in 2003. It was common knowledge that they were out of money. Just another scam, covered up by the Funny Paper of record.

So very typically Portland.


Anonymous said...

We have a similar problem here in Medford. Information concerning last year's construction bond for the school district has been exposed as completely inaccurate and likely purposely misleading. Promises were made and now it looks as though few of those promises will be kept.

We all speak of learning from such mistakes but ten years from now how many people will remember these scams before we support another pie in the sky public works project that fails us?

The lesson I have learned is simply not to trust the public sector. Ever.

Steve Plunk

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