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Northern Ontario School of Medicine public forum told about $14M missing in the LU insolvency debacle

NOSM University also needs to work toward solving the physician shortage crisis

The Northern Ontario School of Medicine, now calling itself the NOSM University, might be losing out on millions of dollars in bursary money because of the insolvency declared by Sudbury's Laurentian University earlier this year.

The financial status of LU is being determined by the Companies' Creditor Arrangement Act (CCAA), a federal legal instrument that allows corporations to restructure their finances. It means all the assets previously associated with the university are locked up in that legal wrangle, which could possibly go on for another year.

NOSM University held a town-hall public forum live and online in Sudbury Tuesday evening where there was discussion of $14 to $15 million worth of endowments made to NOSM that were directed to LU before the financial insolvency.

(Read more about this situation in a story from earlier this year).

Dr. Sarita Verma, the CEO, president and dean of NOSM University, said Tuesday she wished she had answers on how to recover the money. 

"But as you know, the CCAA is a very tightly controlled process that dictates what can be said and what cannot be said, what should be said and what should not be said. And from that perspective, what I can say is that NOSM, because it was, you know, very much caring about what happens to that money, although it does not have a legal role per se, in that the donor agreement is between the donors and Laurentian," said Verma.

She added that no one could have predicted at the time the donor agreement was signed that LU would become insolvent or that it would all happen in the midst of a pandemic.  

Verma said her best answer is that the issue is something the courts will decide. 

"And NOSM has put in a claim on behalf of donors to say we have an interest in this $14 million. And so we're advocating for it as well," she said. Verma added that the one thing that everybody in Sudbury knows, is that nobody knows what the answer is. 

"I would love to know what happened to the $14 million, because if we could have it, and it would be transferred to NOSM University as our endowment which I believe it should be, then it would go for the students," said Verma.

The public forum was one of several that have been underway in the past month and will continue through to mid-November. Future forums will be held in North Bay, Timmins, Sault Ste. Marie and Rosseau.

Verma reminded the group that NOSM was born out of the political desire to address the shortage of physicians in Northern Ontario and that effort continues. After the insolvency of LU, it was learned that the accreditation of the NOSM medical degree could be threatened. 

That was one of the key reasons the Ontario government passed legislation last summer allowing NOSM University to come into being. Verma said there are still 45 days in the public proclamation period before the legislation is proclaimed into law.

When that happens, NOSM University will be able to grant the MD degree, along with a Masters of Medical Science.

Verma said other degrees and new academic programs may be approved in time. If anything, Verma said she would like to expand the number of students allowed each year. Currently that number is capped at 64.

Another issue, she said, is the need to establish a NOSM University registrar's office to ensure that medical students registered through Laurentian and Lakehead universities are able to transition to NOSM without loss of tuition. Verma said roughly $1.6 million is outstanding in tuition that was paid to LU by NOSM students.

Verma also told the forum that the effort continues to train physicians, not just for the vital medical reasons, because it has been shown that NOSM is an economic engine for smaller communities across the North. She said communities find if they don't have a doctor, or enough doctors, that people don't want to live there.

Verma told the group that the Ontario Medical Association (OMA) visited Sudbury last week as part of its Prescription for Ontario plan to make health care access more equitable.

It was at a news conference with the OMA doctors that Verma last week revealed there was a crisis in the shortage of doctors across the North. Verma said at that time it would take at least five graduating NOSM classes to catch up to the physician shortage in Northern Ontario. 

At Tuesday's forum, Verma said Northern Ontario needs 313 full time equivalent physicians, this would include 126 family physicians with 86 of them assigned to rural communities. It was also revealed in a slide presentation that Sudbury needs 34 to 36 new physicians. This would include 28 specialists and six to eight family doctors. 

As the forum was wrapping up, Verma said another major issue in the North is the need for better communications infrastructure. 

She said the pandemic has changed the future of health care in remote and rural communities with the idea of virtual health care. She said internet connectivity is a major concern in communities throughout Northern Ontario and it must be improved, otherwise it becomes yet another barrier to health care.

"None of us can tolerate that little circle that goes around and around and around, when you can't talk to somebody," said Verma.

"If somebody is about to share something with you and connectivity does not exist, not only does that create the extra barrier that is already created by masks,  by distance, by being on a web based platform like Zoom or Google Meet, and on top of it, that connectivity sucks." 


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Len Gillis, local journalism initiative reporter

About the Author: Len Gillis, local journalism initiative reporter

Len Gillis is a Local Journalism Initiative reporter at covering health care in northeastern Ontario and the COVID-19 pandemic.
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