Milwaukee Health Services on the mend
Hit with a string of setbacks that resulted in three years of losses and a painful restructuring,
Milwaukee Health Services is again operating in the black, and its chief executive officer is
optimistic that a difficult time in its 25-year history is coming to an end.
"We are on the upswing," said Tito Izard, a family practice physician and chief executive officer of
the community health center.
But Milwaukee Health Services, which provides primary care and other services to about 27,000
people in some of the city's poorest neighborhoods, must now rebuild -- and that will take time and
Last month, it received a $190,000 loan from the City of Milwaukee to upgrade its system for
electronic health records. Still, its financial situation remains precarious, and it will need additional
capital to recover from the setbacks of the past few years.
Milwaukee Health Services employs about 30 full-time doctors, dentists and other health care
providers, and operates two clinics in parts of Milwaukee where access to health care is limited.
"They are vital to our community," said Bevan Baker, commissioner of the City of Milwaukee Health
The problems hit at a time when community health centers were expected to expand because of the
projected increases in patients from the expansion of insurance coverage through BadgerCare Plus,
the state's largest Medicaid program, and the Affordable Care Act.
Among the problems besetting Milwaukee Health Services was losing as much as $750,000 from
April 2008 to September 2010; an accounts payable clerk has been charged in the embezzlement.
The clerk, identified in online court records as Oluwashina K. Aderungboye, is believed to be in
Nigeria. He has been charged with four counts of theft from a business. A warrant for his arrest was
issued Sept. 20, 2011.
The community health center also invested an estimated $3 million over five years in a system for
electronic health records and billing that proved to be a mistake.
It replaced the system with one from GE Healthcare last year that was bought partly with the help of
a $400,000 grant from the Milwaukee Health Care Partnership, a coalition that includes the five
health systems in Milwaukee County.
The move to the new system was costly and time-consuming.
It also led to a lawsuit when the software company for the previous system refused to transfer
patients' medical records to the new system, contending that Milwaukee Health Services owed it
money. The lawsuit subsequently was settled.
Stopping the bleeding
Although its finances have stabilized, it had less than four days of cash on hand as recently as March
31, according to a document given to the city as part of the health center's request for a loan.
And Izard has spent much of the past two years dealing with problems.
Izard, who previously was on the faculty of the University of Wisconsin School of Medicine and
Public Health, joined Milwaukee Health Services as chief medical officer in 2006.
When C.C. Henderson, the chief executive officer, died suddenly in 2010, Izard was made interim
and then chief executive officer of the community health center.
Milwaukee Health Services lost $3.9 million in its fiscal year ended Jan. 31, 2012, and $1.9 million in
its 2013 fiscal year, according to its tax returns filed with the Internal Revenue Service.
The audited financial statement for its 2014 fiscal year has not been completed, but the community
health center lost money, Izard said.
To check its losses, it reduced its staff from the equivalent of about 250 people to 175, and the staff
took pay cuts of 8% to 20%.
"Their CEO and their board and all of their leadership have taken the necessary steps -- and these
are difficult steps -- to make certain that community health center remains viable for years to come,"
The $190,000 loan to upgrade its system for electronic health records will enable Milwaukee Health
Services to qualify for an estimated $250,000 in additional revenue for meeting federal standards for
electronic health records.
In testimony before the Common Council's Finance and Personnel Committee, Izard said the
$190,000 loan was not a bailout.
The clinic will not have to pay interest on the loan, which is due in February 2020.
Milwaukee Health Services initially asked the city for a $900,000 loan so it could hire additional
dentists and nurse practitioners.
The community health center, which has lost about 12 full-time doctors and other health care
providers in the past year, hopes to add staff by this fall.
But hiring doctors, dentists and other health care providers requires money upfront, given that
several months will pass before they start seeing patients and the community health center is paid
by government health programs and insurers.
Getting a new doctor established and generating revenue, Izard estimates, can cost $40,000.
"The less money we have in the coffers," he said, "the slower the growth."
The community health center isn't expected to lack for patients.
And Izard is hopeful that Milwaukee Health Services will be able to get additional financing through
foundations or other organizations.
The problems and setbacks, though, have postponed his ambitious plans for Milwaukee Health
His goal is to improve the overall health of a community marked by poverty, unemployment, violence
and other social problems.
He grew up near the main clinic, at 2555 N. King Drive, and has no illusions about the challenges
and obstacles. But he also sees his job as a mission.
"To me, being a physician is a huge blessing," he said. "I don't take it for granted."
The past three years were unexpected. But Izard contends the worst is behind the community health
"Milwaukee Health Services will be strong again," he said. "The question is whether it takes 18
months to three years or whether it takes five years."