Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.

Description of the video:

Scarpino: I wanted to talk to you about several of the initiatives that you undertook while you were the leader at Indiana University and some of them have already come up and so I’ll truncate what I was going to ask. You oversaw what I believe is the largest privatization initiative in the history of the university when you oversaw the consolidation of Indiana University Medical Center and Methodist Hospital to form Clarian Health Partners. What was the origin of that plan?

Brand: That was an important change and like other major changes at a university like Indiana you can’t really assign it to one person, and you do have to understand what the situation was. At that point, health care was in turmoil. It’s still in turmoil, it’s just a different turmoil right now. But it was in turmoil then and in particular our medical school which at that point owned and controlled the hospitals was concerned about the fact that they were losing market share, hence not able easily to continue to educate all the medical students, interns, and residents. It is the second largest medical school in the country. So they were worried about the ability to have opportunities for their students and they were beginning to worry about financial issues.

At that time medical schools, some of the most famous medical schools in the country with associated hospitals, were losing literally hundreds of millions of dollars a year, and while that had not yet happened at Indiana it was clear that it was down the track unless something changed. And we had good consulting advice on that. Dean Daly at the medical school was very helpful along those lines and most especially John Walda, who was head, chair of the board of trustees at that point, was an important player in this and as we all worked together on this and began to understand what the situation is and continue to get good advice from many consultants and others, it was decided that we needed to do something different with the hospitals. The medical school always had to be part of IU but you had to decouple the medical school from the hospitals.

Scarpino: That being Indiana University Hospital and Riley Hospital?

Brand: Yes. How do we decouple those two major hospitals in a way that enables the medical school to still have outlets for physician training but at the same time is financially viable? And there were lots of experiments going on across the country in doing that and the approach that we wound up taking was to find a partner, which was Methodist Hospitals, to form a new corporation, which was named Clarian, and bring together the academic physicians with the private practice physicians in this new operation. That had been tried elsewhere in the country and to the best of my knowledge they all failed over time except this one.

Scarpino: Why do you think that is?

Brand: I think it is for a couple of reasons. First of all there’s a confluence of values between what we wanted to accomplish at Indiana University and Methodist Hospital. I think there was good leadership that was persistent and saw through not just on the IU side, although a lot of the emphasis came from the IU side, but also from the Methodist side. There were some real challenges. The academic and private practice physicians had, and to some extent still do have, different agendas and it’s harder for them to work together. Now they’ve come together since then and those who couldn’t have left. But I think that— what it turned out was that the business model was actually more successful than we expected and that saved, I think to a great degree, some stress on the university if it had to start paying out $50 to $100 million a year to make up for losses in the hospitals. But the—putting together the two groups of physicians proved more recalcitrant than predicted.

So there were significant challenges. I think we’re pretty much in our tenth year of it right now and I still continue to serve on the Clarian board. I still follow that particular initiative of the university and I think it works for the city and now for the state. It’s been an important step forward for the university but very difficult to accomplish. Despite the fact that the state of Indiana gave very little funding to the medical school, they still as if they owned it and so we spent close to a year in hearings about whether the state should permit this merger to take place. But it did and we worked our way through it. I, again, give a lot of credit to John Walda especially who, at the board leadership level, was a terrific partner to work with us and should get a lot of credit for it.

Scarpino: In addition to putting physicians from two different cultures together and persuading the state of Indiana or the state legislature, the state administration in Indiana, that this was an appropriate idea, what were some of the other leadership challenges that you faced in order to make this work?

Brand: We had to make sure that people understood what we were doing in both institutions. We had to set up structures from scratch, bring together two different medical systems. Facilities turned out to be a great challenge too. Some of the facilities were aged in some places. We had to create a transportation system between the two hospitals. They’re about a mile, mile and a half apart. We had, in fact, put up a people mover, a monorail, and we had to start from scratch in creating a culture of a new medical center.

It has been remarkably successful I think and now it’s not just the major health provider in the city of Indianapolis but through its affiliated hospitals statewide the major health provider in the state and while Indiana University doesn’t own Clarian, it is a 50% partner in it. So I think the fact that you didn’t have to own it to get all you needed to be accomplished both in terms of education, research, and clinical care was an importantly different concept for the institution as a whole and it took some time to help, say, some of the board members as well as the general faculty understand that the goals were not necessarily to own it. It isn’t like old General Motors where you have to own everything but rather what are your goals by running a medical school and hospitals and how best can you accomplish that?

Scarpino: Why do you think Methodist signed on to this?

Brand: I thought they saw a good opportunity in terms of creating a larger organization with a larger market share. They were a hospital and they had no medical school or nothing beyond that so they were just looking to merge hospitals. But I think as Indiana University went around to the various hospital systems in the city and the state to see who would our best partner would be, there was really, as I mentioned before, a confluence of values. Although Methodist is a sectarian school, a sectarian institution and Indiana University and the medical school obviously is not non-sectarian, that didn’t get in the way of the values for health care, for respect for people, for charity care in particular. The charity care for University Hospital is well known but Methodist itself was deeply involved in charity care and so I think just those goals and values that came together made it a lot more palatable and made it very clear that Methodist was the best partner.

Scarpino: The sense that I get as a non-technical observer of the medical industry in the Indianapolis metro area is that it’s highly competitive in particular areas and constantly seeking to expand market share. Was that an advantage that Methodist accrued by partnering with Indiana University, that it really allowed it to increase its presence in that competitive market in the city?

Brand: Yes, that’s exactly right. Now remember, both of these were and are not-for-profits. That doesn’t mean there isn’t competition because Clarian, for example, is providing over $250 million a year in charity care. You’ve got to have some revenues coming in if you’re going to do anything like that and you’ve got to be able to pay for the docs and the hospital beds and so on. So you need to also think about as a business as well as a not-for-profit healthcare organization. Methodist understood that and saw there was some advantages in coming together with Indiana University. I don’t think, at least for the first few years, that Methodist really understood what the true advantage was in terms of having not just university hospitals and a fine children’s hospital such as Riley, but also that the medical research done by the medical school was an asset in patient care. I think now it’s fully realized but that took a while to get into the culture.

Scarpino: What became your agenda for Indiana University? I mean, we did talk a little bit last time about how your leadership style is to listen and gather information and talk to people and then develop an agenda and when you finally got to that point what was the agenda that you developed for Indiana University?

Brand: Well, academically I was very interested in making sure that the undergraduate student body had an up-to-date curriculum. The last time curriculum had been undertaken on the campus had been literally decades ago. I looked at that. We looked at questions about where the opportunities lie and Indiana University has strong arts and humanities and the music school in particular is very strong and so how do you figure out how to support that section of the university but also to look for some opportunities to grow the sciences. Indiana University does not have a School of Engineering, and one of the things I did and I spent a long time, talked with many faculty members about this, is figuring out what would engineering be in the 21st century. This was in the late, I did this in the 1990s. What would engineering—what would be the leading type of technical, scientific approach, and it had something to do with information technology and so we took Indiana University which was, frankly, not on the map with information technology, and I hired a very strong chief information officer—a man named Michael McRobbie, who is now the new president of IU—to help transform the institution and worked to start up a new School of Informatics which is the applications of information technology to life and work. So that was one thing that I worked towards.

And another thing that I worked towards was understanding the very special role that the School of Medicine plays, and not just on the IUPUI campus, but in the state. It’s the only medical school in the state and as such the university has responsibility, not just for training doctors, but because of the associated medical centers—the hospital themselves who has a very significant role in health care. And so how can we enhance the health care both clinically as well as in terms of research and one of the areas I worked hard in was the biomedical or life sciences initiative, starting with genomics and moving on to proteomics.

When I first started to do that, I remember I went to a group of leading business professionals in this area and I told them that we need to have a statewide effort along these lines and the state has to contribute to it as well and the university by itself can’t do it and we should get special state money. And then I took on a, for about a year or a year and a half, I visited every rotary club and every animal club—you know, moose and elk and so on—just through the state and for that period of time tried to raise the profile of these efforts. The good news is that the state accepted that, and I remember when I spoke to former Governor O’Bannon and then Lt. Governor Joe Kernan about this and they thought it was a good idea but they weren’t really ready to put any money in it. But we worked through the legislature and we got something called the 21st Century Fund which was investment capital for these kinds of activities.

And then I worked closely with the Lilly Endowment. At first they provided a $50 million grant for our information technology efforts and then a $100 million grant or $106 million grant for our life sciences initiative. And so, part of the job of the president is to not only help strategically but find ways to support it. Rather than reallocate money my job was to go out and find new sources of funding. So those were two important initiatives and I tried to use those to glue together the campuses. With Informatics it’s a single school that crosses both campuses.

Scarpino: Right. New building on the IUPUI campus.

Brand: New building on the IUPUI campus and eventually a building on the Bloomington campus, and I think right now it was 150 new state supported faculty members and so it’s a university-wide, not campus-specific, effort. While the life sciences initiative was mostly directed towards the medical school, obviously because that’s where a lot of the expertise lie, I wanted to engage the life sciences on the Bloomington campus and that was tough. I remember I went and met with the biology department which is a fine department on the Bloomington campus and I told them that they need to work closely with the people in the medical school. This was before we got new funding, and I said, “You know, there are some opportunities here and moreover there are some very good people there worth collaborating with” and they almost threw me out of the room. They said, “We’ll collaborate with people from medical schools but you know, Stanford or Harvard. We’re not going to collaborate with folks up in Indianapolis.” And of course that was dead wrong and they realized it was wrong as soon as I got the funding [laughing] because they were cut out, and eventually brought them back in but only under the condition that they would collaborate. The ability to build those collaborations across campuses in life sciences was critical because there were good basic scientists on the Bloomington campus and extraordinarily good clinicians as well as basic scientists on the Indianapolis campus and the question was how do you get them all to work together. Other than try to talk them into it there’s very little you can do except when you have some resources that they’d like to have a share of. That helped.

Scarpino: And eventually they did work together.

Brand: It’s fits and starts, and the answer is yes. We got that done.

Scarpino: You mentioned a couple of terms about five minutes ago that I’m going to ask you to briefly define just because I don’t think most people who listen to this are going to know what they are. Genomics and proteomics and I probably didn’t even pronounce them right, but. . .

Brand: It’s looking inside the molecules for understanding what the causes of diseases are. Looking inside the DNA of humans, and at that time they had not yet mapped the entire human genome and so that was still ongoing and so part of it was figuring out how to map the human genome in some classical models like mice and rats and then use that information for drug discovery. As they got more deeply into that problem they found out it wasn’t just the genes but it was the proteins in the genes—and that’s proteomics—proteins in the genes that needed to actually be investigated at which point, the Lilly Endowment made an additional, very large, investment. In fact, in my last several years at IU, the Lilly Endowment invested over $200 million, $250 million, in the institution and that was really quite a breakthrough. I was pleased I was able to be part of that because prior to that the endowment, which is centered in Indianapolis, and committed to Indiana, was uncomfortable with supporting public higher education and was very uncomfortable with supporting anything to do with medicine and life sciences. And in working with the leadership with the Lilly Endowment, I think we were able to break through and I really appreciate their willingness to take a chance on Indiana University along those lines and my view is that those investments really paid off.

Scarpino: Do you think that the emphasis on informatics and on life sciences as it has played out has added research dimensions to Indiana University or shifted the direction of research performed at the university?

Brand: Oh, I think it’s added dramatically to the university. It hasn’t taken anything away. They’re still doing research on Shakespeare and philosophy is still being taught and the School of Music is still performing great classical opera. So all that’s true but in addition, there’s some great research now going on that’s going to have consequences I think for the health and well-being of not only people in Indiana but well beyond that. I think it’s significantly enlarged the base of research at Indiana. I’d like to think and I hope I’m not sounding unhumble at this but I like to think that the impetus I put towards life sciences very early on and initiated that project had an important role to play in the state’s adoption of that as, and many people’s adoption of it, as a major, not just economic force, but force for research and the wellness of people.