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Documents Show Tulare Hospital Loan Went to Past Due Payments


Documents, provided to the Valley Voice through a Public Records Act request, show that the entirety of the $800,000 loan the Tulare Local Healthcare District (TLHCD) recently approved went to pay off past due invoices to a single supplier–Cardinal Pharmaceuticals.

The loan, approved in September 2016, paid back invoices that were due so far back as November 2015 and as recently as May 2016. The data provided to the Voice totals those past due invoices at $827,922.34.

The revelations come on the heels of good news from Moody’s, a major credit rating agency, which reaffirmed the district’s bond rating and improved its outlook from “negative” to “stable.”

Emails Show Knowledge

Internal district emails provided to the Voice show conversation between Delbert Bryant, the hospital’s controller/compliance officer, and John Thomas, a loan officer at the Bank of the Sierra, regarding the loan.

In a July email, Bryant tells Thomas that the district has been “on this journey” since May 12. The last invoice from Cardinal was due on May 8, 2016.

Later, an August 15 email to Bryant from a Cardinal Health representative asks for an “estimated funding date.” The email was also carbon-copied to Alan Germany, CFO for Healthcare Conglomerate Associates, the company contracted to run the Tulare Regional Medical Center.

Bryant then forwarded the email to Thomas.

View note

“Assuming you get the board resolution on the 25th,” Bryant writes, with Lehmann’s email below the main text, “what do you expect the timing of the funding will be?”

The email conversation shows that Germany and Bryant appeared to know as early as August 15 that the loan was, at least in part, intended to repay Cardinal Pharmaceuticals.

Board Members in the Dark?

Even if certain district officials already had plans for the loan in August, the loan’s purpose appeared to evade members of the board at the September 1 special board meeting in which the board, with Laura Gadke absent, approved the loan.

Board member Linda Wilbourn stated at the meeting that the money, at the time, did not have an intended use.

“This isn’t saying that we’re going to pull out $800,000; we may only need a certain small amount of that to pay a vendor,” she said.

Dr. Parmod Kumar, another TLHCD board member, concurred. He also stated that the board would approve any use of the loan, and that it did not have an intended use.

“If we do spend this money, we will bring that item to the board to be voted by the board to be spent on a particular item,” Kumar said. “This particular resolution, it is just a line of credit, we have done it numerous times, so on those documents, there are no details, we are not cutting a check tomorrow to somebody for this amount.”

Earlier in the meeting, Dr. Benny Benzeevi, CEO of HCCA, stated that the money could be used to get a discount with a vendor.

“Sometimes being able to to pay a larger amount at one time allows us to get a better overall return, in this case a larger discount, and so this specifically would affect our ability to get a larger discount with the vendor by making a payment in one lump sum,” Benzeevi said. “So this would be a loan from the bank to be able to do that so we can get that discount from the vendor.”

No Response

Visalia lawyer Michael Lampe, representing plaintiffs in two lawsuits against the district, revealed the emails at the district’s regularly scheduled October meeting.

“[…] was the board aware of the falsity of those statements when Dr. Kumar falsely represented at the September 1 Board Meeting that, ‘if that check is cut it will be approved by the board, it will come here’ — was the falsity of that statement known to the board at the time,” Lampe asked, “or the alternative, did the board actually meet at a later point in time in a non-agendized meeting to approve that loan to Cardinal Pharmaceuticals? These are questions that I would invite the board either collectively or individually to answer to the public.”

No board member directly addressed the charges during the meeting.

District’s Response

“The real question that should be asked is why are some members of the community trying to viciously and falsely discredit the greatest success Tulare Regional Medical Center has had in its history,” a statement from the hospital to the Voice read.

“Anybody who’s anybody knows that cash flow and profit are two different things.  Any smart business will do what it can to maximize cash flow. The profits of the hospital for the last three years are indisputable. Two audits have already confirmed this and a third one is on the way.  Four total credit rating agency upgrades (FITCH Ratings and Moody’s) specifically mention HCCA as being the cause of the dramatic turnaround and further confirmed it.”

“As for Michael Lampe and his political stunt, all that did was cost taxpayers more money for lawsuits without merit, as evidenced by individuals being named and then removed from the lawsuits. This is exactly the kind of baloney that these people have done before and have obviously not learned their lesson. They are repeating the old ways, which in the past have brought the hospital nothing but failure, disgrace and shame.”

The spreadsheet provided to the Voice detailing the invoices is available for viewing and download below. Additionally, the emails referenced in the article are also available below.


National AccountAccount NumberInvoice DateInvoice NumberInvoice AmountPO NumberInvoice Due Date
401711374111/4/153361777646.60110315MS340B0111/13/15
401711374111/5/15336756242.10103015MS340B0111/13/15
401711566511/6/153374580826.893899811/12/15
401711374111/6/153375601206.55110515MS340B0111/13/15
401711374111/6/153375935147.44110515MS340B0211/13/15
401711841411/7/1533817041,883.87110615MSWAC0111/13/15
401711374111/7/15338089490.92080415MW340B11/13/15
401711374111/7/153381703544.21110615MS340B0111/13/15
401711566511/8/1558310SC9.5711/8/15
401711841411/9/1533878302,876.60SEN-245364511/13/15
401711374111/9/153387828769.60SEN-245364411/13/15
401711374111/9/153387829146.56SEN-245364411/13/15
401711841411/10/1533911122,902.37110915MSWAC0111/20/15
401711374111/10/1533911091,125.24110915MS340B0111/20/15
401711841411/11/153397146705.7011/20/15
401711841411/11/1533983422,275.89111015MSWAC0111/20/15
401711374111/11/15339647661.94SEN-239181811/20/15
401711374111/11/1533971171,428.0911/20/15
401711374111/11/1533983452,015.82111015MS340B0111/20/15
401711566511/12/153405217182.283910711/19/15
401711841411/12/153404148862.9811/20/15
401711841411/12/1534079741,002.70SEN-246058511/20/15
401711841411/12/153407975114.67SEN-246058511/20/15
401711374111/12/15340388846.98110915MS340B0111/20/15
401711374111/12/153407976596.91SEN-246058411/20/15
401711841411/13/15341057876.6111/20/15
401711841411/13/1534111263,451.9211/20/15
401711841411/13/153411714572.07111215MSWAC0111/20/15
401711841411/13/153412116547.5411/20/15
401711374111/13/1534117151,015.62111215MS340B0111/20/15
401711841411/14/15341749549.51SEN-246459211/20/15
401711374111/14/153417493180.12SEN-246459111/20/15
401711374111/14/153417494222.64SEN-246459111/20/15
401711374111/14/1534182551,779.72SEN-246469211/20/15
401711566511/15/1558335SC15.6811/15/15
401711841411/16/15342116319.61SEN-234708811/20/15
401711841411/16/1534215261,788.16111515MSWAC0111/20/15
401711374111/16/153421522894.65111515MS340B0111/20/15
401711566511/17/153425537169.743899811/26/15
401711566511/17/153427247161.993917711/26/15
401711841411/17/153427053384.58111615MSWAC0111/27/15
401711374111/17/153426034165.57111515MS340B0111/27/15
401711374111/17/153426171156.60111215MS340B0111/27/15
401711374111/17/153427052961.03111615MS340B0111/27/15
401711841411/18/1534338992,990.08111715MSWAC0111/27/15
401711374111/18/1534338962,384.13111715MS340B0111/27/15
4017114043611/19/153444313770.44SEN-247284711/26/15
401711841411/19/15344050019.6011/27/15
401711374111/19/15344021055.19111515MS340B0111/27/15
401711374111/19/153444311222.33SEN-247284511/27/15
401711374111/19/153444312128.24SEN-247284511/27/15
4017114043611/20/15344917036.22111915MSGPO0111/26/15
4017114043611/20/153449171852.13111915MSGPO0111/26/15
401711841411/20/153449161219.56111915MSWAC0111/27/15
401711374111/20/153449162987.36111915MS340B0111/27/15
401711566511/21/153454321161.993926511/26/15
401711841411/21/1534550001,678.52SEN-247689211/27/15
401711841411/21/153455014511.0311/27/15
401711566511/22/1558490SC18.5311/22/15
401711841411/23/1534620851,566.9811/27/15
401711841411/24/1534648869,589.0312/4/15
401711841411/24/153464887127.7612/4/15
401711841411/24/153465156263.7912/4/15
401711566511/25/1534704152,032.973931412/3/15
401711841411/25/153469970107.4912/4/15
401711841411/25/1534715873,805.3112/4/15
401711841411/25/15347205211,619.2912/4/15
401711841411/25/153472053630.0212/4/15
401711841411/25/1534752551,770.600422912/4/15
4017114043611/27/1534772921,613.003933212/3/15
401711841411/27/15347946365.6512/4/15
401711841411/27/1534806341,434.0212/4/15
401711841411/27/153480635142.3212/4/15
401711841411/28/1534855851,764.3712/4/15
401711566511/29/1558511SC19.1611/29/15
401711841411/30/15348868110,069.0012/4/15
401711566512/1/153492743371.203936012/10/15
401711841412/1/1534938791,271.7612/11/15
401711841412/1/1534939861,298.2312/11/15
401711841412/1/153493987137.5112/11/15
401711841412/1/153497730442.430423212/11/15
401711841412/1/1534977691,299.450423212/11/15
401711841412/2/153499607431.49110415MSWAC0212/11/15
401711841412/2/153499932161.3612/11/15
401711841412/2/153500644371.2512/11/15
401711841412/2/153500647371.2512/11/15
401711841412/2/1535014237,031.71120115A12/11/15
401711841412/2/153501424592.92120115A12/11/15
401711841412/3/1535084123,298.3512/11/15
401711841412/3/153508413188.7912/11/15
401711841412/4/1535150511,639.1112/11/15
401711841412/4/1535150526.2112/11/15
401711841412/5/15352108912,501.0212/11/15
401711841412/5/153521142500.6912/11/15
401711841412/5/15352114335.5012/11/15
401711374112/5/15352037676.44111515MS340B0112/11/15
401711566512/6/1558707SC20.8712/6/15
401711841412/7/15352426110.8012/11/15
401711841412/7/1535279721,382.2712/11/15
401711841412/8/15352952612.30111715MSWAC0112/18/15
401711841412/8/15353083712,326.0412/18/15
401711841412/8/153530838278.6912/18/15
401711841412/8/153530893348.3312/18/15
401711841412/8/153534236433.150423212/18/15
401711566512/9/153537095773.913951312/17/15
401711841412/9/153537046285.0012/18/15
401711841412/9/1535382204,347.5812/18/15
401711841412/9/1535385622,199.2812/18/15
401711566512/10/153544857742.403952612/17/15
401711841412/10/1535456291,920.3512/18/15
401711841412/10/1535456742,561.0512/18/15
401711841412/11/1535516261,339.5312/18/15
401711841412/11/1535526994,940.5012/18/15
401711841412/11/153552700262.8812/18/15
401711841412/11/1535559041,770.600423512/18/15
401711841412/12/153557486235.9612/18/15
401711841412/12/1535583983,144.2012/18/15
401711841412/12/153558399102.7212/18/15
401711566512/13/1558733SC27.8912/13/15
401711841412/14/1535619824.9412/18/15
401711841412/14/1535621674,028.9912/18/15
401711841412/14/153562187662.9712/18/15
401711841412/15/153566730754.3112/25/15
401711841412/15/1535678141,384.7012/25/15
401711841412/16/1535754489,463.9712/25/15
401711841412/16/15357554614.0412/25/15
401711841412/17/153581342104.1612/25/15
401711841412/17/15358134569.4412/25/15
401711841412/17/153582347173.6012/25/15
401711841412/17/153583160781.3912/25/15
401711841412/17/15358316110.3712/25/15
4017114043612/18/153589125171.9012/24/15
401711566512/18/153588568129.603964612/24/15
401711841412/18/1535899347,822.6412/25/15
401711841412/18/15358993524.2812/25/15
401711841412/18/1535899981,672.4012/25/15
401711566512/19/153595157284.673962612/24/15
401711841412/19/1535957161,439.27121815A12/25/15
401711374112/19/1535951343.15110315MS340B0112/25/15
401711566512/20/1558903SC29.1712/20/15
401711841412/21/15359935921.6012/25/15
401711841412/21/15359984973.71122015A12/25/15
401711841412/21/153599850951.81122015A12/25/15
401711566512/22/1536041101,304.443968712/31/15
401711841412/22/153603462953.821/1/16
401711841412/22/1536058721,456.761/1/16
401711841412/22/153605873403.281/1/16
401711841412/22/153605884105.901/1/16
401711841412/22/1536092811,732.60042401/1/16
401711841412/23/1536135551,581.451/1/16
401711841412/24/1536199291,782.291/1/16
401711841412/24/1536205928,279.901/1/16
401711841412/24/153620763127.471/1/16
401711841412/24/153620784431.701/1/16
401711841412/24/153621382449.831/1/16
401711841412/24/153623326779.051/1/16
401711841412/26/1536272362,413.201/1/16
401711841412/26/153627237141.461/1/16
401711566512/27/1558929SC34.4012/27/15
401711841412/28/153630304122.051/1/16
401711841412/28/1536308328,104.131/1/16
401711841412/28/15363083391.961/1/16
401711566512/29/153636008607.60397751/7/16
401711841412/29/1536364436,497.221/8/16
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4017114043612/31/153649947287.66110515MSGPO011/7/16
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401711404361/2/163657616100.001/7/16
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