Forensic audit in ‘hands of authorities’


A forensic audit originally scheduled for completion in October was never mentioned during Tuesday night’s hospital board meeting.

The board ordered the forensic audit in August and was told it would be complete and presented to the board in October. A forensic audit, which should help explain how the hospital district ended up $13 million in debt, is a financial review designed especially for use in civil or criminal court proceedings.

Following the board meeting, Ken Doran, CEO of Spectrum Health Partners, said the audit is now under review by state and federal authorities but would not elaborate.

Doran said neither the hospital administration nor the board have seen the audit, which was completed the first week of January. The audit had been turned over to authorities by Bill Mabry, an attorney with Frost Brown Todd, who represents the hospital, he said. Authorities should complete their review of the audit in the next two weeks, he added.


During the board meeting, chairman Jim Evans appointed new board member Bruce White and member John Nall to a strategic review committee, which will be responsible for assessing proposals to purchase or merge with Westlake.

Doran said letters have been sent to 17 different agencies and they have until Feb. 17 to make a proposal.

He expects a special called meeting to be necessary in March to narrow down potential partners to three.

Doran recommended to the board to hire Bradley Arnt Boult Cummings, a law firm in Nashville, to provide legal services for a sale or merger. Doran said he has worked with attorney Steve Brown on 75 acquitions and 30 sales and considers him the best.

The fees, which Doran said were discounted, would be $15,000 a month retainer with a total cost ranging from $125,000 to $175,000.

Board members asked to review an agreement proposed for the law firm and are expected to address the issue next month. Doran said the attorneys would probably not be needed until April.



The hospital district has received $1 million of the $1.7 million it borrowed through the county.

While December patient census saw an improvement, the district showed a net loss of $132,781 for the month. For the six months ending in December, the district showed a $1.5 million loss.

The district is operating on a tight cash flow, even with the influx of funds from the county. December’s financials showed the hospital with $193,000 in the bank and $1.5 million in liabilities. Doran said $700,000 of the debt is current with another $400,000 being less than 60 days old.

The hospital did receive some good news this month. While they were expecting a cash influx of $400,000 from the state because of a new technology system, they learned they would instead receive $850,000. Of that total, $245,000 is expected to arrive during the next two weeks.

The board approved agreements to return two doctors who worked previously with Westlake. Dr. Jesus Siady will work up to three days a week at Westlake Primary Care. He will be paid $145 an hour.

Dr. Charles Townsend will work at Edmonton Primary Care under the same agreement.

Outgoing board member Bradley Irvin was recognized for his work on the board.

The hospital board meets the last Tuesday of each month at 6:30 p.m. at the hospital board room. Chairman Jim Evans, board members John Nall, Russell Guy Perkins, Josh Harden and Bruce White attended Tuesday night’s meeting.

By Sharon Burton

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