Southern Inyo hospital official claims HCCA sent supplies from Tulare, “grossly deficient” in management

The Southern Inyo Hospital in Lone Pine, Calif. Tony Maldonado/Valley Voice

Healthcare Conglomerate Associates’ (HCCA) management of the Southern Inyo Healthcare District’s hospital was ineffective, hindered the hospital’s regulatory compliance, and was fiscally irresponsible, a legal filing by the district claims.

The filing also repeats claims that the Tulare-based hospital management company shared money and supplies between the Southern Inyo district, which owns the Southern Inyo Hospital, and the Tulare Local Healthcare District, which owns Tulare Regional Medical Center.

The filing comes after HCCA requested $1,184,730 in back management fees, a $1,201,474 termination fee, and $137,850 in fees for the company’s chartered flights to Lone Pine, California, to visit and work at the Southern Inyo Hospital.

HCCA additionally requested the total of $2,524,054 be recognized as an “administrative expense,” giving HCCA priority in being repaid by the Southern Inyo district.”

Attorneys for the district, which owns the Southern Inyo Hospital, claim that the the hospital management company’s services weren’t beneficial to the district, cannot be given “administrative priority,” and claim that the company isn’t entitled to its termination fee.

“The District believes that HCCA’s mismanagement has caused damages to the District that exceed the amount claimed by HCCA in the Motion,” the district’s legal filing reads.

In a declaration filed in the United States Bankruptcy Court, Jaque Hickman, a member of the district’s board of directors, expands on claims that HCCA’s work was not to the district’s benefit.

“Throughout the entire term of the Management Agreement, HCCA failed to adequately perform its duties,” Hickman states. “In general, HCCA provided grossly deficient on-site management, failed to manage and collect the accounts receivable, entered into non-beneficial contracts on behalf of the District, hired improper personnel for various employee vacancies, and caused non-compliance with a number of state regulatory requirements.”

Marshall Grossman, an attorney for HCCA, disputes those claims, and others made by Hickman and the Inyo district.

“She is free to say anything to the media, but just wait until she is put under oath,” Grossman said. “Our comments will be made at that time.”

Repeating Withdrawn Claims

The Southern Inyo district previously agreed to withdraw declarations by its bankruptcy attorney, Ashley McDow, and Hickman, as part of a stipulation that allowed for the quick rejection of HCCA’s contract with Southern Inyo.

Those declarations included claims that HCCA failed to make intergovernmental transfer payments, which earn the district money that it can use towards its services, and that HCCA transferred funds from Southern Inyo to Tulare without the Southern Inyo district’s consent or knowledge.

The claims resurfaced in Hickman’s declaration to the court.

“The Board did not know monies flowed back and forth between the District and Tulare except to be told that the IGT money came from Tulare because it had to come from a government agency. Supplies came into the District from Tulare,” Hickman’s declaration reads, “but there was supposed to be an accounting entry that would reflect them as a vendor. This does not seem to be the case since no financials were ever presented.”

The filing also claimed that there were other financial misdeeds committed by HCCA.

“HCCA illegally transferred monies from the skilled nursing facility resident fund on April 11, 2017. HCCA transferred $11,000 from a patient trust account to the general account, then transferred $11,000 to the payroll account,” Hickman wrote. “HCCA did not return the funds to the patient trust account until August 31, 2017.”

Travel By Private Plane

Records submitted by HCCA to the bankruptcy court show the company chartered at least 50 different flights to Southern Inyo, at an average cost of $2,500 per flight.

A short video produced by the company detailing its work at the Southern Inyo Hospital shows Benzeevi sitting in, and later stepping out of, a Beechcraft 200 Super King Air. The plane, tail number N437WF, was registered at the time to Shae-Ron LLC, a Bakersfield corporation.

The travel by plane and lack of dedicated, on-site administration caused significant problems for the district, Hickman claims.

“HCCA personnel were almost never on site, and the Administrator’s office was empty 90% of the time. HCCA brought over personnel from HCCA headquarters, whose services were sporadic and ineffective,” Hickman writes.

Instead of staying behind and working at the hospital, Hickman claims that HCCA’s personnel would “drop off suggestions at the Facilities then leave,” and did not provide “team building, training, or follow-up” for the hospital’s employees.

“Because HCCA management was not on site at the Facilities, HCCA incurred significant expenses travelling to the Facilities. The Travel Expenses are even more unreasonable given the fact that HCCA always travelled to the Facilities using an expensive, private jet,” she added later in the declaration.

Hamstrung IT Projects

Hickman claims a contract that HCCA arranged with Medsphere Systems Corporation “has never worked to produce revenue,” despite costing $28,800 per month. Medsphere’s OpenVista product was purchased to provide an Electronic Medical Record for the hospital’s operations.

“HCCA did not provide the personnel, financial information, or training to make the Medsphere contract worthwhile,” her declaration reads.

A 2017 press release from Medsphere lauded the company’s “go live” of the OpenVista product at Southern Inyo.

“The go live of OpenVista Cloud at Southern Inyo is a highly significant event for us because it manifests our broader healthcare IT vision,” Dr. Benny Benzeevi, HCCA’s CEO, said in the release. “We appreciate the truly collaborative approach Medsphere took to the implementation and the efforts the implementation team made to meet the specific needs of a rural, critical-access hospital. This will change for the better the way we provide care.”

“When [Electronic Health Record] projects are essentially driven by the vendor, they are less successful. Southern Inyo ensured their own success by engaging from start to finish,” Medsphere’s CEO, Irv Lichtenwald, said in the release.

Additionally, she claims HCCA failed to oversee the hospital’s transition from its former patient billing software, Healthland, to a new billing system, Medworxs.

“HCCA did not manage or oversee billing software conversion from Healthland to Medworxs; and, as a result, accurate accounts receivable information was not available, leading to overstated and inaccurate accounts receivable in the millions of dollars,” Hickman wrote.

Southern Inyo’s situation with accounts receivable mirrors the situation at Tulare.

Dan Heckathorne, the Interim Chief Financial Officer of the Tulare district, stated that the company discovered “millions of dollars’ worth” of payments that had been delivered to the hospital, but not accurately reflected on patients’ accounts.

“There were payments that came in previously — the cash had came into the bank, but the payments weren’t posted onto the patients’ bills,” Heckathorne said.

At a Southern Inyo board meeting in August, numerous issues were raised by staff members regarding the status of the hospital’s IT projects.

“Mr. Burgess provided an update on MedWorxs implementation. He emphasized that I.T. is currently working collaboratively with MedWorxs and the clinical team at SIHD to provide solutions to the issues that have been raised,” the August board minutes read.

Minutes from a September board meeting indicated that “107 issues” were found with the hospital’s implementation of the MedWorxs system, some of which related to billing, and others to training.

In Depth: Tulare Regional Medical Center

26 thoughts on “Southern Inyo hospital official claims HCCA sent supplies from Tulare, “grossly deficient” in management

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  1. The plot thickens. Update: a certain elected official continues to refuse to give back the thousands he received from HCCA operators.

  2. Hello “EH and “The Truth”, I guess Souther Inyo Hospital is “full of hate” as well. Do you think the people of Inyo Hospital District should also “Wake Up”? Perhaps we can car pool when visiting Benny behind bars.

    • Eh and Truth will continue to do what HCCA trolls do. They will come here and deflect, insult and then make some generic statement about us coming together. The town is united. Everyone see’s what’s coming except Benzeevi

  3. Southern Inyo, that your Rep Senator Devon Mathias, he brought HCCA to you and recvd campaign money from then. He is up for re-election my think twice before voting for him again. We here in Tulare are still trying to clean up HCCA and old board mess which included Kumar, get in touch with DA

    • DA Tim Ward won’t do anything. He was bought by Benzeevi donations also.
      He just recently got involved because he HAD too

  4. Who is going after Kumar ? The Charles Manson of the past board who memorized his counterparts to do his bidding which has us in the deep continuing mess we are in. Yes Grandma you are correct about Kumar as this town is struggling to bring our hospital back Kumar is busy buying more land and remodeling his many properties while still trying to convince everyone he comes in contact with he was “ wronged “ what a piece of work that one is … in my day he would have been run out of town with pitchforks!

    • Kumar as Manson!! Very amusing! Yes similarities (both sociopaths) but the difference is that Kumar used money. Was Torres the board member who ran / owned a boxing club? I recall reading in the paper that Kumar was a financial backer of his boxing club. IF so, then the guilt lies with Kumar and sleaze bags like Torres who would sell out HIS OWN COMMUNITY for a few bucks.

  5. Any sound minded person could have seen the writing on the wall for Southern Inyo Hospital. The little minded town was so impressed with HCCA as they arrived on their private jet(that wasn’t really their’s). They couldn’t see past the song and dance that Benny and his minions put on. The board was made aware of the turmoil Tulare was in but instead turned their back to it. Hickman and the board were aware of all mismanagement that was going on to keep Southern Inyo a float. Now Hickman is trying to clean the blood stains off her hands by playing the deer in headlights. Its funny how you must read about your local hospital in a newspaper from another town as none of the local reporters here will tell the truth and turmoil the hospital is in. Local news over here in Inyo County are reporting how important it is to pass Measure J to “try” not guarantee to keep the hospital open. After reading Hickman’s declaration there is no way Measure J will even come close to providing enough funding to help dig SIH out of the hole the current board helped dig. But hey good job Jackie.

  6. They also flew alot of TRMC supervisors, directors and staff to Southern Inyo to perform duties. They would never provide any payroll records to me as requested to see if TRMC paid for their time down there even though even they were HCCA employees and should come from Southern Inyo funds

  7. You play with snakes and you will be bitten…….I hope people remember that …..

  8. “HCCA illegally transferred monies from the skilled nursing facility resident fund on April 11, 2017. HCCA transferred $11,000 from a patient trust account to the general account, then transferred $11,000 to the payroll account,” Hickman wrote. “HCCA did not return the funds to the patient trust account until August 31, 2017.”…a new low!

  9. Rural hospitals have a hard time making it. They usually treat sicker patients and pay more to do so. No sane and solvent HC corp is going to run to take over TRMC or S Inyo.

  10. The bottom line, Southern Inyo doesn’t want to pay up any services were given to them by HCCA. Time will unravel about the audit by the DA and we will all see who are the real crooks. It’s easier to follow the crowd and point fingers instead of stepping back and let the truth surface. The truth will come out eventually.

  11. “Truth”, I find it quite interesting how some people so completely believe in their superiority that they , perhaps sincerely , are blinded to their dishonest, unethical and predatory behavior. Eddo Benzeevi actually seemed indignant that he was being investigated by the FBI (yes Mr Mayor, that was reported in the L.A Times..look it up). It is even possible that Benny thinks he is a victim of hate. Yes “Truth”, we will see who the real crooks are. Yes , the truth will come out. And when the truth comes out, and when the public expresses it anger , I dont doubt that you will truly be surprised and ask “Why Us?”

  12. tularepatriot, I googled Eddo Benzeevi and it’s true that the FBI raided his office and found… NOTHING. Just because someone was accused, it doesn’t mean that person is guilty. He’s apparently not behind bars but seemed to be even more successful in what he had accomplished since then. Do you think he bought out the FBI? Seriously, he’s not that powerful! He’s just a business man, not a man with such strong political power to buy out the FBI. As far as I can google, he did not even go to trial… no wrong doing was ever confirmed. It’s so easy to just follow the crowd and accuse others versus really do your research and think things from a different angle.

    • I did not say he was found guilty (O.J is not guilty either). I simply am pointing out the fact that the FBI (not “the crowd’) found reason to investigate him.
      Unfortunately, the concerns of the FBI at that time were not sufficient to make the Hospital board thing twice about giving the management to his brother. Citizens who brought up these legitimate concerns at a public meeting were simply shouted down. (Would you do business with someone who is being investigated by the FBI? Especially concerning business involving the health care of others). Also note that a previous article in this paper notes that the Department of Justice and also the FBI are investigating Bensleezys role in Inyo hospital and TDH. So no, I dont think Eddo bought off the FBI. Perhaps your comments are wasted on me. Try telling the Department of Justice and the FBI to “do your research and thing things from a different angle”

  13. This group just keeps bullying and make accusations….. How is this legal??? They are so lost and keep blaming others for everything so the focus will not be on them. Enough of this nonsense. YOU closed the hospital not Benzeevi!!

  14. When the investigation from the DA finds no wrong doings by Benny, will all of you have any decency to apologize? What happened to innocent until proven guilty? You supported the board to close the hospital. The board listened to you! This hospital had years of turmoil, way before HCCA. You should question why instead? Is it the culture here? Even if the hospital will open, unfortunately will be back in turmoil just like a decade ago. You short sighted people want to simplify everything and point fingers. The investigation is extensive and will cost all of us tax payers a lot of money just to make the DA look like he’s on our side. They should have found something by now with through all these months and resources they are using. There’s no whistle blower in any wrong doing. This investigation is looking for a needle in the hay stack. If there’s something illegal, they should find it by now. It’s much easier to blame than to really understand the complexity of running a hospital. HCCA put in their own money to do payroll while the district just sat there and blamed all short comings from Benny. No team work was done! But the accusations are only one sided.

  15. Mickey,
    I agree with you wholeheartedly.

    The reality is that Inyo is taking advantage of what’s going on with HCCA and Tulare. They don’t want to pay so they are jumping on the band wagon of vilifing Benny. Inyo was in bankruptcy before HCCA entered in a contract with them. They had Benny to loan them money to they can do payroll and now they are trying to not pay the management fees. It’s as simple as that.
    All of you who have so much courage to condemn Benny and crew hopefully will have the courage to apologize once this is over. The DA is not going to find a thing. No wrong doings were discovered by the FBI of Benny’s brother, and now it’s Benny’s turn. The truth will surface and the bad guys are the ones who are pointing the fingers.

    • You are so wrong. HCCA put Southern Inyo into bankruptcy and they took 3 months to get it open. They used staff paid by TRMC to open it and they took equipment from Tulare. In bankruptcy they magically got new X-ray equipment. Who paid for that, HCCA?

  16. When the investigation from the DA finds no wrong doings by Benny, will all of you have any decency to apologize? What happened to innocent until proven guilty? You supported the board to close the hospital. The board listened to you! This hospital had years of turmoil, way before HCCA. You should question why instead? Is it the culture here? Even if the hospital will open, unfortunately will be back in turmoil just like a decade ago. You short sighted people want to simplify everything and point fingers. The investigation is extensive and will cost all of us tax payers a lot of money just to make the DA look like he’s on our side. They should have found something by now with through all these months and resources they are using. There’s no whistle blower in any wrong doing. This investigation is looking for a needle in the hay stack. If there’s something illegal, they should find it by now. It’s much easier to blame than to really understand the complexity of running a hospital. HCCA put in their own money to do payroll while the district just sat there and blamed all short comings from Benny. No team work was done! But the accusations are only one sided.

    Tulare Patriot,
    You can’t compare Iddo to OJ. Iddo didn’t go on trial because no wrong doing was found to even to to trial.

  17. While i have no firsthand knowledge of many of the items i do know that if there is smoke there is usually fire and i know from firsthand knowledge that Bensleasy still hasn’t paid me for a substantial amount of PTO. Sounds like a crook to me.

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