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Dr. Danny Jacobs announced his resignation Thursday as president of Oregon Health & Science University in an email obtained by WW, ending a tenure marked by management missteps that demoralized employees and raised questions about his ability to lead Oregon’s premier health care institution through a takeover of rival Legacy Health.
“After careful consideration and for personal reasons, I have informed board chair Chad Paulson of my intent to resign as president, effective upon the appointment of a successor,” Jacobs said in the email Thursday to staff. “I have shared my recommendations on succession planning with him and fully intend to stay engaged in an advisory role during the transition.”
That transition may last just a day, according to an email from Chad Paulson, who became chair of OHSU’s board in September, replacing Wayne Monfries, the chair who presided over the hiring of Jacobs in 2018.
“After careful consideration of what is best for the university and its statewide mission, the OHSU board of directors will contemplate a resolution at the board meeting tomorrow to appoint Nate Selden, M.D., Ph.D., the next president of OHSU, effective immediately for a term of three years, upon approval,” Paulson said in the email Thursday to staff.
The departure of both Monfries and Jacobs means that OHSU must rely on a new, untested board chair and president to raise the $1 billion in debt it needs to take over Legacy while both institutions are struggling to control costs and boost revenue.
Paulson has no professional health care experience. He is general counsel at Powin Energy Corp., a Tualatin-based company that makes industrial-scale batteries. Selden joined OHSU in 2000 as an assistant professor of neurological surgery. He became dean of the OHSU School of Medicine in June after Jacobs demoted his predecessor, Dr. David Jacoby, who remains a professor.
Jacoby had crossed Jacobs by refuting OHSU’s version of events surrounding the dismissal of Dr. Daniel Marks, who allegedly took pictures up the skirts of female students with his smartphone during a class he led. Earlier today, Jacoby filed a complaint in Multnomah County Circuit Court alleging that OHSU wrongfully blamed him for awarding a $46,000 bonus to Marks just before he was forced out of his job. Jacobs and members of his senior staff had approved the bonus, Jacoby says in his suit.
Dr. Jeffrey Jensen, a vice chair in the School of Medicine and the most vocal opponent of Jacobs, lauded his resignation.
“He was toxic and now he’s gone,” Jensen tells WW. “Every direction he went in was wrong. This is welcome news for the OHSU community. It will help us come together as an institution.”
There is concern among OHSU employees, including senior professors, about naming Selden as president for three years without a search or even more deliberation, according to two senior members of the faculty who declined to be named amid concern about retribution from OHSU’s leadership.
“The faculty is up in arms,” one of the faculty members said. “Why isn’t the board doing its job?”
Both said they worry that the board is rushing the process, making the same mistake it did in April 2023, when the board gave Monfries sole authority to negotiate a new contract with Jacobs. Monfries extended Jacobs’ contract by two years and gave him an extra $700,000 in retirement pay just before OHSU started laying off workers to cut costs. The extra payment incensed employees when reporting by WW made it public, prompting unions to protest.
OHSU spokeswoman Sara Hottman said she couldn’t say immediately why the board had decided to vote on Selden’s permanent appointment tomorrow instead of conducting a search.
Jacobs was named OHSU’s fifth president in May 2018 and succeeded Joe Robertson that August. Jacobs grew up in rural Arkansas and got his medical degree from Washington University in St. Louis. He completed his residency in general surgery and fellowships in surgical nutrition and metabolism at the University of Pennsylvania and the Brigham and Women’s Hospital in Boston, then earned a master’s degree in public health from Harvard University.
Just before coming to OHSU, Jacobs had been executive vice president, provost and dean of the school of medicine at the University of Texas Medical Branch in Galveston. Jacobs maneuvered OHSU through the COVID-19 pandemic, when inflation drove up the cost of salaries and supplies at the same time that revenue declined along with surgical visits.
The first inkling of concern about Jacobs’ leadership surfaced in April 2023, when the Portland Business Journal reported that 27 department chairs at the OHSU School of Medicine took an informal poll asking whether they thought the university’s board of directors should reappoint Jacobs as president. Twenty-six of the 27 said no, according to the Business Journal.
In August 2023, OHSU announced it was considering a takeover of Legacy Health, drawing more scrutiny of its management and more concern among workers. A month later, WW reported that OHSU had polled 19,369 employees about their jobs. More than 7,000 responded, and just 54% said they would stay at OHSU if they were offered a similar position at a different hospital. Worse yet, just 44% said they had confidence in “senior management’s leadership.” About a third were neutral on that question, and another third had “unfavorable” opinions.
(OHSU is scheduled to release this year’s employee engagement survey to university leaders on Oct. 28 and to all employees on Oct. 30, according to an email about the survey obtained by WW.)
The prospect of two huge hospital systems merging prompted more doctors and nurses at Legacy, a mostly nonunion institution, to organize. Unions at OHSU, meantime, sought more aggressive guarantees about job security and wages.
Amid those union pushes, Jacobs handed out $15 million in “President’s Recognition Awards” to nonunion employees. The bonuses weren’t tied to performance. Recipients had to be employees in good standing at the time. One of those bonuses went to Marks, the doctor accused of taking upskirt photos, as first reported by The Oregonian.
After WW reported the bonuses and unions decried them, Jacobs rescinded payments to his topmost executives, saying that money for the bonuses had been exhausted after distributions to lower-paid employees.
Another gaffe under Jacobs: In October 2023, OHSU said it planned to discontinue benefits coverage for employees’ domestic partners and children at year end. After pushback from workers, Jacobs reversed the new policy on the same day.
That matter drew scorn from Brian Druker, the developer of Gleevac, a drug that revolutionized cancer research.
“First and foremost, I want to apologize to anyone who spent even a minute thinking that a loved one would not have benefits,” Druker wrote in an email obtained by WW at the time. “I am sure that that despite the reversal of this decision, the impact and trauma caused by these events is far more serious. It is my strongly held view that this withdrawal of benefits should never have been seriously considered at an institution that prides itself on diversity, equity, inclusion and belonging.”
Paul Buchanan, the lawyer who prepared the suit that Jacoby filed just hours before Jacobs emailed staff about his plans to resign, welcomed the change in leadership.
“I believe this is a very positive development for OHSU,” Buchanan said. “I sincerely hope that it helps to bring our dispute to a speedy resolution, something we have been seeking for months.”