DEAN VICTIM OF HEALTH CARE REVOLUTION; MEDICAL SCHOOL HEAD TIRES OF JUGGLING ACADEMICS, FINANCIAL PRESSURES.

Byline: Tom Philp Scripps-McClatchy Western Service

Gerald S. Lazarus, who as dean of the University of California, Davis School of Medicine has tried to balance academics with the financial realities of a cutthroat health care industry, stunned colleagues last week when he announced plans to resign and return to teaching.

``Do I really want to do this for an extended period of time? The answer is no,'' said the 58-year-old Lazarus, who has held the post since 1993 and who ushered in a variety of big changes to the medical school.

The school faces numerous political and financial dilemmas, including questions about its treatment of minorities, a looming federal audit of faculty billings and care for seniors on Medicare.

But none is unique for medical schools in the 1990s. Compared with UC's other four medical schools, Davis ``just goes merrily along doing its job,'' said Roy Brophy, a Fair Oaks resident and UC Regent, who added that he was ``terribly surprised'' by Lazarus' resignation.

``I was shocked,'' said Dr. David Follette, an associate professor of surgery and transplant medical director.

Chancellor Larry Vanderhoef, however, was not.

Lazarus' four-plus years on the job are average for medical school deans these days, Vanderhoef said.

``It is an extremely difficult job,'' Vanderhoef said. ``I'm fully sympathetic with Jerry feeling strongly about getting back into the crux and core of medicine. I'm glad we had him for the four years.''

After stepping down on July 1, Lazarus plans to spend a year at the University of California, San Francisco ``refreshing my clinical and scholarly skills.'' Then he will return to Davis ``to refocus on issues involved with how to deal with this real change in health care.''

Running UC Davis' Medical School means juggling the needs of 400 students, roughly the same number of professors and a teaching hospital that needs more than $1 million a day to survive.

Add to this mix the state's fast-growing health maintenance organizations, which have controlled spending in part by reducing payments to hospitals and shifting some business away from the more expensive teaching hospitals.

``The major casualty of the managed care revolution is the academic medical centers,'' Lazarus said. ``We're really getting killed.''

All this was on the horizon as Lazarus came to Davis in 1993 from the University of Pennsylvania School of Medicine. There, for 11 years he was chairman of its dermatology department. Previously he had held an endowed professorship at Duke University.

His tenure at UCD has had a string of firsts.

Lazarus helped merge the school and the UC Davis Medical Center into a single academic/business machine, called UC Davis Health Systems.

UC Davis now has what is believed to be the first HMO license held by any university in the nation. The venture, known as Western Health Advantage, combines UC's doctors with those affiliated with the Mercy system.

UC is also partners with the Shriners hospital system, which last month opened what will be its national flagship facility across X Street from the medical center.

``I view our success as extremely, extremely positive,'' Lazarus said.

So then why resign?

Thoughts of resignation began to cross his mind, said the dean, as he began preparing comments for his first formal evaluation. UC deans receive such formal reviews every five years.

``This is clearly the most difficult job I have ever had in my life,'' he said. ``I don't want to continue doing this for a prolonged period of time.''

Running a UC medical school ``is a burnout job, it really is,'' Brophy said.

Along with its many successes, the school and medical center have weathered some publicity bruises in recent months.

After watching its minority enrollment fall from a record-high of 32 in 1993 to a record low of 2 in 1996, a coalition claimed discrimination, prompting legislative hearings.

Federal auditors have targeted UC Davis and the system's other four teaching hospitals in an unprecedented wave of audits of Medicare billings. The first two probes of teaching hospitals in Pennsylvania produced $42 million in settlements.

And after charges of illegally holding a meeting behind closed doors, UC officials in February released details of how independent auditors have ``very serious concerns about the accounting and financial controls'' at its teaching hospitals.

Lazarus said none of these matters influenced his decision to resign. Rather because the overall direction of the school ``is so positive,'' now is a good time to step down.

Dr. Joseph Silva, chairman of UC's internal medicine department, will serve as interim dean.

Vanderhoef said he plans to consult with faculty leaders to help decide how long the school should operate under Silva until a formal search produces its new leader.

``There is no extreme and unusual rush here,'' Vanderhoef said.