Doctors’ contracts under review

Published 1:50 am Saturday, October 30, 2010

Staff Writer

Saying he is concerned about mounting losses to the Beaufort Regional Health System from some of its affiliated doctors’ practices, a member of the BRHS Board of Commissioners on Friday called for a review of BRHS contracts with those doctors.
“The time has come for us to deal with a situation that this board has known about since February,” said Hood Richardson at a meeting of the Finance Committee of the BRHS Board of Commissioners.
Richardson serves as chairman of the committee and on the Beaufort County Board of Commissioners.
According to Richardson, those contracts have resulted in a loss of about $2 million a year over the past two years for BRHS.
“It’s very easy to say the physicians are tanking the hospital,” he said. “We need to start a thought process about these contracts.”
He said a review of the contracts is needed in order to ensure that they each contain some type of productivity goals for each doctor covered by contract.
Finance Committee member Grace Bonner agreed.
“We need some accountability of those practices,” she said.
The contract review would apply to 24 doctors that are part of Beaufort Regional Physicians, LLC, according to BRHS officials.
Beaufort Regional Physicians, LLC, is a limited liability company organized in 2009 under the direction of BRHS that contracts for services with many of the local doctors, according to articles of organization on file with the N.C. secretary of state’s office.
Richardson also said, in an interview after the meeting, that he plans to give a copy of a Deloite Financial Advisory Services audit of the Beaufort County Hospital Foundation to auditors with LarsonAllen LLP of Charlotte for review by that firm.
The BRHS board recently approved a contract with LarsonAllen to perform the 2009-2010 fiscal-year audit of the health system.
Auditors with the firm are expected to visit the local hospital in two weeks. They are scheduled to meet with the health system’s Finance Committee at that time.
Copies of the 18-page Deloite audit, titled “Beaufort County Hospital Foundation Report of Preliminary Phase I Findings and Recommendations,” have appeared on the doorsteps of several local businesses and homes in the past two weeks.
Marked confidential, the audit apparently details the findings of an investigation by Deloite, the firm hired by the hospital foundation as part of an investigation into the suspected embezzlement of funds by a former foundation employee.
At the time of the Deloite audit, the foundation was the fundraising arm of the hospital.
In August 2008, Jeanne W. Jones was convicted of felony embezzlement from the foundation. She received a sentence of six to eight months in jail, but that sentence was suspended. As part of her sentence, Jones was placed on supervised probation and ordered to repay the foundation $97,644.70. That amount included the money embezzled and $10,000, a fourth of the cost of a forensic audit conducted in the case.
An investigation into Jones’ actions began in 2007 after the embezzlement was reported by the foundation.
A copy of the Deloite audit was given to committee members for their review along with copies of various physician contracts from which identifying information was removed.
In other business, the committee unanimously approved continuing discussions with Health Capital Investors Inc. of New York of a plan under which the company would provide BRHS with a loan based on BRHS’s accounts receivable.
Such an arrangement would allow BRHS to make payments to its vendors and avoid late fees, BRHS interim Chief Financial Officer Richard Reif told the committee.