Steve Russo HFS: What happened to this report? And more KVHD conundrums including the much awaited strategic planning "plan"

Money for nothing

Down the rabbit hole, or on this blog, I have collected decades worth of evidence showing how the Kern Valley Healthcare District has mishandled it's business "affairs" over the last 20 plus years.

Though it began for me, as I have described in the summary, as a case of elder abuse, and mishandling of law enforcement to protect the patients living in the KVHD nursing center, it turned into a more complex case the California Department of Justice simply did not want to handle.

That was only the beginning, as money which is now so scarce in these parts, (rural blight) went into the pockets of those who had contributed to the downfall of the small hospital and Rural Health clinic.

Contractors: Bernie and his PR company got 60K dollars for doing something undisclosed.

HFS a financial firm who put together a plan to aid the hospital in default with creditor, insurer, Cal Mtg, and help pull them out of the ditch they are stuck in from years of imprudent spending, was a 75K dollar boondoggle as board members complained that HFS had left holes KVHD had to repair in the report.

It was reported only after that meeting in December 2010, that HFS gave KVHD back 40K dollars for, what we can only assume, as board member, Dr. Robert Gross DO, said was a lot of mistakes.

"The finance committee found a lot of holes-a lot of mistakes, large mistakes," Gross told the audience about the report.

He added, which I think is a good line, but not pertaining to HFS, more like KVHD: "So do we really want to trust them with planning our financial future, when they had giant holes and we paid top dollar for that?"

Again, what did they pay for? And why did they, meaning KVHD and Cal Mtg., not take action against HFS for what they called a report full of mistakes in public and on film?

I have the report, or maybe even "a" report and I would like to know what parts are the mistakes and how did KVHD who hand picked HFS to do this "operations report" as the hospital was floating checks, and not checking to see if they were still afloat, while they went into default.

Strategic planning...more unnecessary costs?

The CFO, Chet Beedle, and CEO, Tim McGlew, both supported the hiring of a strategic planning group. However, the survey which cost the hospital 15K dollars, has yet to be unveiled after 8 months, and those who attended the sessions were directed to only make inquiries which were positive, according to owner, Michael Philps.

However, Beedle's resume, suggests, or really states that he is an "expert in strategic planning for rural healthcare districts." Again, this makes no sense, to spend money when you already have hired personnel who does this sort of project...and is an expert.

And there have been some really intensive plans created before this one, at a cost too, and yet most of the information gathered never was utilized, therefore more wasted time and money.

When asked how it will be different this time around, Philps answered that his company suggests that the board address the planning issues from his survey at every meeting.

We have yet to even see the first draft.

When the selection process took place last year, Board member Kay Knight, asked why HFS was not in the running to do the planning and she asked the CEO if he had talked to them about reducing the costs for a strategic makeover.

McGlew reported he has spoken to HFS about their costs, which were submitted at 20K dollars, and the two other players, Focus and Execute, bid 13K dollars, while Philps wanted 15K dollars.

The contract went to Philps, as McGlew said he spoke to other CEO's who have used that particular firm. But his reason was the money: grant money.

"Their figure was 15K but Focus and Execute was 13K-so but again these guys went out to find grant monies to offset some of these costs..." McGlew explained.

What is wrong with this picture?

First, KVHD had a default with Cal Mtg. last summer, or actually since the "80's" but Cal Mtg. gave the sinking hospital the choice of the company that would do another in a long line of reports costing hundreds of thousands of dollars, and they chose HFS.

HFS we were told would report to the community about their findings, but this never happened. Instead, at the December 2010 KVHD board meeting, we found out from Dr. Robert Gross that HFS made "mistakes."

The HFS contract we were told cost 75K dollars, and that payment was coming from a line of credit backed by Cal mtg. from West America Bank.

Yet, somehow, HFS, was selected to be in the running for the strategic planning contract. Why would you even consider a company that is supposed to have made "large mistakes?" (Dr. Gross asked that question and I think it was a worthy one)

How many wishes were granted?

Then you have the issue of Philps and the grant money they grabbed to help KVHD offset costs, said the top administrator. First, at the meeting McGlew reported Philps had obtained the grant money themselves.

In a phone interview, I congratulated Mr. Philps on garnering grant money to help KVHD save a few dollars on their latest planning session. Then I asked him exactly how he went about the process with this grant money and if the other companies were also doing this.

Philps answered most of my questions, but would not answer that particular question and directed me to speak with McGlew. I told him I got an answer from McGlew, and he said they gave over their annual 9K dollar SHIP grant monies: These are monies that go to the hospital, not to firms vying for a contract or job.

At the July 2011 meeting, only a few weeks ago, we heard that finally, there will be a presentation with the data gathered by Philps. But last year we were told we would be seeing the HFS report too, and that never happened.

Will KVHD have to fill in the "holes" in the strategic planning report too? What if the report is not what they want us to hear, can we get our money back such as with HFS?

Steve Russo of HFS was asked about the problems with the KVHD report, but offered no explanation.

But then nobody could offer a lucid explanation as to why HFS was not fired and another company brought in to finish this operations analysis. I don't understand why KVHD was fixing the report for another company, especially when they were in default caused by their own mistakes, as the company was to provide an objective analysis.

Mind boggling isn't it?