Hardy calls for BRHS board integrity pledge

Published 10:56 am Thursday, December 9, 2010

Staff Writer

A member of the Beaufort Regional Health System Board of Commissioners suggested conflicts of interest could arise as members of his board deliberate the future of Beaufort County Medical Center.
Edwin M. “Sandy” Hardy, a Washington attorney and BRHS board member, said all of his fellow board members, including two who have health-care businesses, should pledge they would not enter into any hospital-tied purchase or partnership affiliation with a BRHS partner that would benefit them financially.
“If there’s even a possibility that they even think it could happen in the future, they should step down,” Hardy asserted. “The process needs to be done properly, morally and ethically.”
Hardy said he has pledged that neither he nor any member of his family will go to work at the hospital. He said other board members also should take that pledge.
“I’m not claiming anybody’s going to do anything improper, but we should do so that, if there is an appearance (of conflict of interest), we should step aside,” he said.
Dr. Brenda Peacock, vice chairwoman of the BRHS board, has a medical practice, Washington Women’s Care, Hardy pointed out.
He added Peacock contacted the hospital board in December 2009 or January of this year regarding the possibility of partnering with the hospital.
Board member Howard Cadmus owns an urgent-care facility, Carolina East Medical Associates, Hardy said.
“There are other board members who, who knows, might end up working for (a BRHS partner), and they’re not health-care professionals,” he said.
He did not name these other board members.
In response, Peacock said the hospital had never offered to buy her practice.
“If this hospital does not maintain a viable facility where I can have privileges to operate, then my practice is worth nothing,” she stated.
Peacock said she didn’t approach BRHS when the hospital was acquiring a number of local medical practices.
Peacock was not a member of the hospital board when she approached that board about a theoretical partnership.
“I like to say that it is in my best interest, but it’s not a conflict of interest, to have this hospital maintain its current function,” she said.
Cadmus agreed he had been accused of having a conflict of interest.
“If it came to anything that I have anything to do with, I would abstain from the vote,” he said. “It’s been reviewed by three different attorneys, and Dr. Peacock is in the same position.”
Hood Richardson, BRHS board secretary-treasurer and a county commissioner, questioned why Hardy raised no objections when Dr. Sandy Easley, a local obstetrician-gynecologist, was a member of the board.
“Sandy Hardy sat there with Dr. Easley, an employee of the hospital, on the board and did not challenge him,” Richardson said. “Which is a greater conflict of interest: someone running an individual medical practice or an employee?”
Continuing, Richardson said of Hardy, “He’s a lawyer. He should have a whole lot better understanding of a conflict of interest than the rest of us do.”
Richardson said early on Hardy “demanded that we go with” University Health Systems of Eastern Carolina as a management partner.
“I question who’s got a conflict of interest here,” he said.
In his interview, Hardy said he was “totally in favor of” UHS, one of four potential suitors that could emerge as a partner for BRHS.
Hardy said he’s aware of no legal conflicts of interest among his fellow board members, but implied his concerns center around what might happen down the road.
“I think we need an integrity pledge,” he said. “People need to put the community first.”
The BRHS administrative manual shows its policy is designed “to protect BRHS’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or trustee or employee of BRHS or might result in a possible benefit transaction.”
The policy defines an individual financial interest as, “An ownership or investment interest in any entity with which BRHS has a transaction arrangement;” a “compensation agreement” between BRHS and any other entity; a “potential ownership or investment interest” in such an entity; or someone serving as “an officer, trustee, member or other title leadership within an entity with which the hospital has or is negotiating a transaction or arrangement.”
The policy dictates board members will not use their positions for financial gain.
The policy also makes it clear that, after the disclosure of a board member’s interest, “The remaining Board or committee members shall decide if a conflict of interest exists.”