Grand Jury Releases “Tower of Shame” Report on Tulare Regional Medical Center

From the Tulare County Grand Jury, which today released a report on the Tulare Local Healthcare District and Tulare Regional Medical Center:

“The Tulare County Grand Jury today released a scathing report on the Tulare Local Healthcare
District (dba Tulare Regional Medical Center) and its failed attempt to expand its facilities
following an $85 Million bond issue passed by voters in September, 2005. The report (the full
text of which is attached) cited that the TLHCD Board of Directors “withheld financial
information to which tax payers were entitled.” In fact, over a five-year period, TLHCD’s Bond
Oversight Committee repeatedly requested financial information specifically pertaining to the
expenditure of bond funds which had still not been provided when the Grand Jury report was
finalized.

The Grand Jury report also discloses that extraordinary costs were incurred by the District in the
form of seven hundred (700) change orders during the construction of the Phase I Tower project.
These change orders amounted to $17,511,869. in additional costs of construction. The Grand
Jury’s exhaustive investigation covered seven months and included interviews with numerous
witnesses as well as the review of hundreds of pages of subpoenaed documents. This process
rendered a four-page report containing eight “facts,” seven “findings” and three
“recommendations.” The Report give the Tulare Local Health Care District Board of Directors
ninety days in which to formally respond.

2015-2016 Grand Jury Foreman, Chuck White, explained that standard procedure is for Grand
Jury reports to be released all at once in late May or early June when they are compiled and
distributed in the Final Report of the tem1. “However,” White said, “We believe that the facts,
findings and recommendations of this report are so important and so long overdue that an early
release was warranted.”

The full report is available below:

12 thoughts on “Grand Jury Releases “Tower of Shame” Report on Tulare Regional Medical Center

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  1. As someone that served on the board from 2000-2008 I will tell you exactly what happened but unfortunately the community didn’t want to hear it then and they probably don’t want to see the truth now. A few corrections from what I recall to this story. First the bond over site committee was not formed until after the bond was passed. Each board member appointed two people to the original committee and I believe the CEO appointed two people. There were also two board members on the committee. There were people involved in the passing of the bond but no committee until after it passed.

    In 2005 the project was $105 million, not $120. We never planned to have a second bond. By the time it was going out to bid in 2009 it was $120 million. We knew it wasn’t enough but we were growing and it was the largest amount the consultants felt we could pass based on our tax base at that time. We had a strong census, almost double of what it is today. Volume makes the financial picture very different, we didn’t have to ratchet staff to make ends meet nor slash and burn benefits. We were growing private pay insurance and recruiting good doctors. We were planning for an East Campus next to Evolutions that would have been outpatient services and physician offices – that project was singlehandedly killed by a board member. The board and the management team knew that to see the tower project to completion we had to hold tight and keep growing the engine to fund the debt service of the revenue bonds.

    We had an OIG complaint and a lawsuit in 2007 from a terminated employee that was never defended which should have been. Instead district just paid out over $3.5 million total in this situation. There is more to that story but anything else would cause me to breech closed session.

    Since late 2006 the board has been controlled by one individual. This board member sat on the building project from inception and even in the pre-planning process. He has micromanaged the hospital to the point he is suffocating it too near demise. This is not an attack on his medical expertise but it as a testament to his managerial skills. As a board member if he has always been way too involved in operations.

    Wake up Tulare, we need a vibrant hospital and we can keep passing all the bonds we want both if the same leadership is in place it is just going to be money being wasted away.

  2. Deanne is right on. We debated asking for more in the bond, but at $85 million it was already at the high end of what the consultant said we could pass. It is the still the most money passed by voters in this county. The project began at $105 million and we knew it would be tight. CEO Bob Montion felt the hospital should put up some money and that not all should come from the taxpayers, thus the $20 million commitment from the hospital. We also knew if we came up just short, we could shell the upper floor until money became available. More than $17 million in changes — including the helicopter pad which is a waste of money since it will only be used to send patients out — is what is to blame for the shortfall along with other mistakes, and it is the board which approved all those changes to get us where we are today. I see where some people said it was always a $120 million project, and even if that was the case, why is the hospital asking for $140 million now. Still have not seen that explained.

    • Because there is no LOGICAL explanation for the amount. No one independent from the board or management has done a study to estimate the cost to complete. The taxpayers who are being asked to pay are not being represented.

  3. This is obviously an emotionally charged subject. Nobody wants to see our hospital close. However, whether we read about it in this news paper, Fresno Bee, or any other, the Grand Jury’s report is objective and contains facts.

    I do not blame any CEO or the farce conglomerate HCCA, for the state of the hospital. The history of pathologically bad business decisions lies with the hospital board.

  4. After reading the “Fiction vs Fact” flier recently mailed out by the hospital, I feel the need to comment on a couple of “facts”. The hospital in Kingsburg was about to join with Adventist Health when TRMC offered more money up front than Adventist offered. Kingsburg then backed out of the deal with Adventist in lieu of the better looking deal with TRMC. Once TRMC saw how much it would cost to bring the Kingsburg hospital up to code, TRMC backed out of the deal and left Kingsburg high and dry… they forgot to mention that.

    Colusa Regional Medical was in finalizing a deal to join a large hospital chain. Within days of signing the contract, Colusa decided to back out of the deal causing the loss of jobs.

  5. What concerns me are two things: 1) first I am told the money is needed to bring the tower to completion; then I read the ballot description and I see “projects.” This concerns me as it could potentially mean we see other projects funded, such as the seismic compliance and the tower remains unfinished, requiring yet another bond. 2) Nationalized health insurance, the exchanges and the methods of reimbursement have had a huge negative impact on many of the hospitals that have closed. While we might pass the bond, we might still see the hospital closed as the nationwide consolidation of facilities continues. 3) There have been statements by the Yes on I camp that there have been four audits demonstrating all funds were used on the hospital construction. I had heard the original cost projections exceeded 1 million; who is determining the costs now and specifically what are the “projects” funded by the $55 mil?

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