Two Fletcher Allen Health Care administrators resign

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(Host) Trustees at Vermont’s largest hospital blamed their management for misleading regulators about the true cost of a multi-million dollar expansion project. In an internal report on the problems at Fletcher Allen Health Care in Burlington, the trustees also said they were ultimately responsible. They also announced Wednesday that two top hospital officials have stepped down.

VPR’s John Dillon reports:

(Dillon) The trustees launched the investigation last summer to learn how and why Fletcher Allen misled regulators about its $326 million development project.

The report says hospital management deceived the state, the public and even kept key information from the board itself. But Trustee Chairman Phillip Drumheller says the board also missed warning signs:

(Drumheller) “This is a situation where a train was going down the wrong track and it wasn’t stopped. In retrospect, there probably were red flags that the board might have picked up on and responded differently. Unfortunately, we missed those points.”

(Dillon) The first public warning of mismanagement came last summer. The hospital’s former financial officer testified that he was told to keep a $55 million parking garage off the books and outside regulatory review. Hospital officials have since disclosed that its “Renaissance Project” has ballooned to $326 million. The hospital has admitted that about $100 million in project costs should have been reviewed by regulators.

William Boettcher was the executive in charge when many of these decisions were made. Boettcher left this fall and Interim CEO Ed Colodny says two other officials – Chief Operating Officer Thad Krupka and Vice President David Demers – have also stepped down.

Colodny is a former airline executive who also served as interim president of the University of Vermont. He says a CEO sets the tone and the ethics of the organization. Colodny also says the officials responsible for the Fletcher Allen troubles have left:

(Colodny) “Was this a case of somebody lining their own pockets? No. This is not a case where people have taken personal gain. This is a case of bad management, misjudgments, poor judgments, and in my opinion the buck goes to the top where it starts and that’s what happened here in my opinion.”

(Dillon) Drumheller, the president of the trustees, says the buck also stops at his door. He says he offered to step down this summer, but the board wanted him to stay on. He will leave when his term expires at the end of year.

The report says trustees failed to vigorously watch over Fletcher Allen management. And it recommends new internal procedures to avoid future problems. These changes include giving the board better briefing materials, and improving communication between staff and trustees. Meanwhile, the board said that it would phase out its use of Downs, Rachlin and Martin, the law firm that advised the hospital on regulatory matters.

For Vermont Public Radio, I’m John Dillon in Burlington.

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