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Healthcare the American way

A.U.B.M.C. splices some Harvard genes into Hamra

by Thomas Schellen

A cornerstone of the renewal of the Lebanese healthcare industry is a series of investments in hospitals, paradigmatic among which is the project to expand and improve the medical center at the American University of Beirut (AUBMC). First announced two years ago in April 2011, ground was broken on the project last autumn. Construction is currently in the excavation phase for the new, nine-story academic and clinical center on a corner lot once occupied by a low-rise building. Other structures will be razed in the coming years to allow for new units in the massive project.

While the excavation activities and an extensive display project the scope of the project, the plan goes significantly beyond developing several physical structures. 

“The idea is to make this institution really deliver the best care and maintain an edge in education and research,” says Dr. Mohammed Sayegh, AUB’s vice president of medical affairs and dean of the Faculty of Medicine. “When we are talking about best care, we are talking about North American standard-type care because this is, after all, the American University of Beirut,” he adds. 

In pursuit of this aspiration, AUBMC came up with a 10-year, six-point concept that was dubbed Vision 2020 when it became clear that its schedule would run until 2020. When viewed against other “2020 visions” that have been produced for cities, statelets, and whole countries in the Middle East and elsewhere, the AUBMC project has a rather concise feel to it. 

The six components of the plan are: building new physical structures, recruiting medical faculty, improving patient care and service, establishing new clinical and research centers, redesigning the curriculum for the Faculty of Medicine, and creating a collaborative network through strategic partnerships. 


Aiming for the top

The driving force behind the plan is Sayegh, a 1984 graduate from AUB medical school and recipient of numerous awards in his field. He spent most of his career at Harvard before allowing himself to be recruited back to AUB in July 2009. 

An initial assessment of AUBMC at the time showed that it “provided good care but I wouldn’t classify it as the best care we can provide,” Sayegh tells Executive. This insight led to the determination “to elevate standards on all levels”, with the six components of the plan all feeding into the provision of excellent care while fulfilling the medical center’s mandate as an academic institution. 

In an approach typical for such a venture in the United States, the institution is relying on fundraising to develop new physical structures.

“We value this project at around $400 [million] to $500 million for the physical structures,” Sayegh says. In addition to the hefty construction price tag, he estimates that another $100 million or so will flow into hiring, investments in new research capabilities, network building and
so forth. 

Cost factors related to the concept are vast and varied, as AUBMC has a host of 500 residents and fellows in the practical extension of the medical school. This training program alone, according to Sayegh, represents an annual budget of $4 million to $7 million in costs to AUBMC. On the patient side, the facility has to wrestle with the inequities of the Lebanese healthcare compensation, just as many other providers of healthcare services do.  

Unlike the US, where the government allocates funding to support residency training, the Lebanese government provides no subsidies for the training of young physicians. On top of that, AUBMC feels the relentless pinch of the “dismal” reimbursements for treatment of patients that are admitted on Ministry of Public Health and National Social Security Fund (NSSF) accounts, Sayegh says. “We have an obligation and accept these patients but they cost us money. The nice thing is that we have a nice mix of patients, where we have some insurance patients, some self-payees and some who are [covered by] government and NSSF.”


The importance of networking

AUBMC’s mix of lucrative and money-losing patients makes balancing the bottom line easier than it is for other Lebanese hospitals. 

The institution additionally changed its stance from academic isolationism of sorts to increased interaction with Lebanese hospitals. According to Sayegh, this was realized by entering into affiliations with several institutions to which AUBMC can dispatch physicians to treat patients who under existing contracts with municipalities and public sector entities are not eligible for admission to AUBMC itself.

Medical provider networking is one of the lessons taken from the AUBMC dean’s US experience at Harvard. Creating such partnerships, which represents the sixth component in AUBMC’s Vision 2020, is also on the agenda of regional interaction with Arab countries. 

Although the six strategic items of the vision are equally important, implementation of some points does presuppose progress on other agenda items. The most pivotal point is reversing the brain drain by attracting highly qualified faculty members to Beirut. Expanding the hospital care capacity to about 360 beds in the immediate term and 600 beds later on is another facilitator required for entering into more strategic partnerships.       

While a sound business model in today’s world is a must also for an academic medical center, the idea for AUBMC’s overall path forward is not commercial or profit-oriented but to financially sustain operations. “Sustainability is critical, otherwise you are losing money every year and cannot in fact have the best academic medical center,” says Sayegh. 

This future will mean, however, a continued dependency on donors who support needy patients through several funds such as the Brave Heart Fund and the Neonate Fund, established in 2012. “The availability of citizens who believe in these missions is very important. You cannot sustain our operation with just pure business models, and none of the academic medical centers can do it unless [they] compromise either on training or on care,” says Sayegh. 

Despite the uncertainties of the Lebanese health care system and despite anticipated dependency on the goodwill of the donor community, the leader of AUBMC and driver of Vision 2020 exhibits no shred of doubt in his return-on-investment projections. When asked how much value he expects each dollar invested in the institution’s universal upgrade project will generate, Sayegh’s answer is categorical: “hundreds, of course.” 

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Thomas Schellen

Thomas Schellen is Executive's editor-at-large. He has been reporting on Middle Eastern business and economy for over 20 years. Send mail

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