printable versionNew finance dean to tackle budget, building challenges
BY RUTHANN RICHTER
Marcia Cohen was appointed in April senior associate dean for finance, succeeding Michael Hindery.
Over the next four years, Marcia Cohen will be expected to help turn the plans for two new medical school buildings into a reality while overseeing a yearly operating budget that is expected to top $1 billion for the first time. She also will be responsible for figuring out how the school will pay for the $544 million in capital projects that are slated for completion in the next decade.
It seems like a daunting task, but Cohen, the new senior associate dean of finance and administration, remains unfazed. "I'm pretty excited, jazzed," she said recently. "I was worried that after doing two jobs, I'd need to take a vacation. But no, I'm ready to go."
Cohen has been the school's chief financial officer for the past three years and took on a second job—interim finance dean—in November, when Michael Hindery announced he was leaving the post after 10 years. A veteran financial manager, she was selected for the senior dean's job after a national search in which she was one of four finalists. The school is now searching for a new CFO to fill her former post.
Dean Philip Pizzo, MD, said Cohen was the clear choice for the senior dean's job. "She is extremely intelligent, hard working and has remarkable experience in financial management and operations through her positions in consulting and academia," he said. "She is also a very effective leader and has won the respect of a large number of individuals at Stanford and beyond—including from me. I am thrilled that she has agreed to take on this enormously important albeit very challenging position for the school and university."
Cohen said that she takes over the job at a time when the school's finances are in good health. The operating budget has been steadily growing and is expected to increase from $975 million this fiscal year to a projected $1.039 billion next year. Clinical revenue, gifts and income from the endowment continue to be growth areas, she said, so that income is keeping pace with the growth in spending.
The one revenue source that's a concern is in the area of sponsored research, she said. After years of double-digit growth, sponsored research this year rose by only 2 percent—to $381 million—in large part because of a decline in real dollars in federal funding for the National Institutes of Health. With a smaller pool of available funds, investigators now face strenuous competition for NIH grants.
"We know some faculty members will not have their grants renewed. This is quite a concern in how we support our faculty when they lose funding," Cohen said.
She's also concerned about new faculty members who receive department and school support in their first three years but are expected to apply for and obtain their own grants during this start-up period. Some may have trouble launching their research programs without NIH funding, she noted.
Still, because Stanford faculty are superb researchers, the School of Medicine remains no. 1 in the country among its peers in terms of NIH dollars per investigator, she said.
Cohen said that while the school continues to see its reserves grow slightly—they now stand at $370 million—much of that money remains restricted in its use.
"So we may have large fund balances, but we will still face financial challenges if we have to draw down our limited unrestricted reserves," she said.
In addition to budget issues, Cohen said she'll focus her attention on major building projects, particularly the Learning and Knowledge Center and the Stanford Institutes of Medicine 1, both scheduled to be completed in the next four years. In February the school selected an architect for the LKC project and is now in the process of selecting one for SIM1, which will house three of the school's five research institutes: stem cells, neuroscience and cancer.
"I can appreciate the importance—the impact—these buildings will have on the medical school campus," Cohen said.
The buildings will be financed with a mix of school resources, philanthropy and debt. For SIM1, the school is hoping to obtain some funding through Prop. 71, the statewide stem cell initiative that is still in legal limbo. An Alameda County Superior Court judge ruled April 21 that Prop. 71 funds can be disbursed, but the plaintiffs who have challenged the initiative have yet to indicate if they will appeal. If that money does not become available, it falls to Cohen to find an alternative.
"Those are all moving pieces," Cohen said of the various funding sources. "So I have to make sure we have a plan, and a backup, that works."
Cohen came to Stanford in 2003 from UCSF, where she spent eight years as the finance director for the Department of Medicine. She also has worked in the private sector, serving health-care and industry clients as a consultant and senior manager for eight years with Deloitte & Touche.
She counts among her major accomplishments here at Stanford her role in renegotiating the formula for determining how much the school receives for its contributions to clinical activities. The new system, worked out with hospital officials over six months of talks, aligns incentives with the hospital for growth and will give the school a more predictable revenue source, she said.
"It felt very rewarding to come up with a new type of funding model that can be transported to other medical schools," she said.