Some paychecks issued by the Tulare Local Health Care District (TLHCD) to its employees on July 20 are not being honored.
Employees at the struggling medical center report TLHCD was unable to meet a deposit deadline on July 18 due to a cash shortage. They also report the District is behind on payments to its vendors, and one source tells the Voice the hospital has ordered employees to selectively order blood transfusions because of an unpaid bill from the blood bank. The District is also struggling to make payments to physicians.
“This is serious,” said a current TLHCD employee who wishes to remain anonymous. “It puts the public at risk.”
District Not Meeting Payroll Obligations?
Another employee who reported the dishonored paychecks said not all of the warrants issued by TLHCD have bounced. Those that did, she said, appeared to be for non-medical staff. The District is also late in making payments to employee 401(k) accounts by at least two pay periods, she said. This is the third time TLHCD has fallen behind on its contribution to employee retirement accounts. Previous arrears have run as long as 10 months behind.
Other oddities and inconsistencies abound. District employees report the amounts they’re paid have frequently been inaccurate since TLHCD switched payroll services. The District’s direct deposit system has failed for the last two pay periods, and employees have been issued paper checks on short notice twice.
“You will receive your paper check on Thursday 07-20-2017 pay-date just like last pay period,” an email from Tammy Kegler, the hospital’s manager of Human Resources read. “With direct deposit service, TRMC must transfer funds by noon on Tuesday to the paying bank. We are not able to meet the time frame required for this week’s direct deposit.”
More shocking, the District appears to be broke. According to recent accounting, TLHCD has less than nine days of operating cash on hand. It is also carrying $20 million in unpaid debt.
Calls to the District’s human resources department regarding unpaid employees were not returned. Dr. Yorai “Benny” Benzeevi, CEO of Health Care Conglomerate Associates (HCCA) which operates Tulare Regional Medical Center (TRMC) also did not respond to a request for an interview on the District’s financial health.
Doctors Not Paid
Dr. Mylene Rucker, contracted by the District to oversee physicians assistants and nurse practitioners at the District-owned Hillman Healthcare Center, said TLHCD has not paid her in three months. The nonpayment, she said, has been a hallmark of her relationship with the District.
“They were supposed to pay me every month,” Rucker said. “It was never fine, always delays, six weeks to eight weeks at a time.”
Rucker, who has now stopped seeing patients at Hillman but continues to oversee mid-level staff there, says she knows of at least two other physicians contracted with TLHCD who have not been paid for their services. Rucker complained each time payment was tardy, and eventually met with the CFO of HCCA. HCCA is owned in part by Benzeevi, who serves as its CEO.
“I had a meeting with (HCCA CFO) Alan Germany,” she said. “He said, ‘Well, we have to bill Medi-Cal for the money. We don’t know if all this is going to go through.’”
Rucker says she’s probably had enough.
“I haven’t quit yet, but I’m thinking about it,” she said.
ER in Peril, Numbers Declining
One of the physicians Rucker says was unpaid was an anesthesiologist who has not received payment for services rendered more than a year ago. Now, another source who wishes to remain anonymous says Tulare Anesthesiologist Consultants Inc., which staffs operating rooms at TRMC, is ending its relationship with the District.
Should that happen, the District will no longer be able to operate its emergency room, provide surgeries or offer maternity care, due to emergency C-sections requiring anesthesia.
Deanne Martin-Soares spoke at the hospital’s finance committee meeting on Tuesday, asking whether the hospital had a backup plan in place.
Hospital officials at the meeting did not directly respond.
“Is this anything that will be discussed at the board meeting tomorrow?” Delbert Bryant, the hospital’s long-time controller, asked Germany.
“Certainly,” Germany responded.
Calls to the anesthesia group’s president were not returned.
At Tuesday’s finance meeting, board members Mike Jamaica and Linda Wilbourn were told that the number of patients seen at the hospital has decreased.
“You can see that the volume is down, and we look at this on a regular basis, and a number of reasons for that,” Germany, the hospital’s CFO said, “as we kind of have all discussed, and are all familiar with.”
While the number of admissions at the hospital were roughly on par with last year’s numbers — 710 in the fourth quarter of 2016, and 702 in the fourth quarter of 2017 — the hospital’s average daily census decreased from 40.3 in the fourth quarter of 2016 to 33.8 in the fourth quarter of 2017.
The total number of clinic visits has also decreased — with the same period in 2016 compared to 2017, from 5,345 to 3,672; from 551 surgeries in 4Q 2016 to 379 surgeries in 4Q 2017. The most significant decline in surgeries was in outpatient surgeries.
Emergency department visits also decreased from 7,905 in 4Q 2016 to 6,606 in 4Q 2017, which Germany stated was likely due to many different reasons — including patients choosing other options, such as patients choosing to go to Federally Qualified Health Centers and clinics admitting to emergency departments in other cities.
“If we went back and worked at this for several years, deliveries at one point were quite a bit higher,” Germany said. “Some of it is the birth rate but quite a bit of it, as we know, is the choice of expectant mothers to go to other facilities to deliver.”
For 4Q 2017, the hospital had 120 deliveries, roughly equivalent to the same period last year
“Roughly, as you look at the three months, an average of about forty a month. Even with that low level of volume, we still have to keep a fully staffed obstetric unit,” Germany said. “That’s a safe thing to do, and of course a requirement to do.”
“Certainly can’t operate efficiently and economically as you have those low delivery levels,” Germany told the board.
A former employee, Greg Cotta, who worked 26 years as an RN at TRMC, agreed that the number of surgeries performed there was down to a third of the volume performed when HCCA took over. Cotta was laid off in September along with 29 other long-time employees.
“It’s just gone down like you wouldn’t believe,” Cotta said.
The drop in patients is similar in the obstetrics department, he said, where births have dropped from about 100 a month to about 30.
“Most of the experienced nurses have gone to Kaweah Delta,” Cotta said. “I don’t blame them. It’s scary for the mothers.”