Joe Nelson, Staff Writer
Posted: 11/05/2010 07:37:55 PM PDT

A raid at Arrowhead Regional Medical Center by FBI agents and district attorney’s investigators is the latest in a series of controversies that have vexed the county hospital in Colton in the last year.

Authorities have refused to divulge specifics of the investigation, leaving the public and San Bernardino County officials wondering why a plethora of documents were seized from the hospital on Thursday.

In the last year, complaints from various hospital employees including alleged conflicts of interest, shoddy patient care and free medical treatment to county employees have surfaced, triggering investigations at the federal, local and administrative levels.

About eight months ago, county Supervisor Neil Derry said he received complaints from various hospital workers alleging county employees and elected officials had been receiving free medical treatment at the hospital.

“They were allegations that individuals were not being billed for services,” Derry said Friday.

He said he reported the information to the District Attorney’s Office and the FBI, but could not say if Thursday’s raid on the hospital was related.

County Administrative Officer Greg Devereaux said the hospital had long ago developed a practice of waiving co-pays and costs for medical procedures not covered by insurance for all county employees.

He said he put a stop to the practice when he first learned about it in April, around the same time Derry received the complaints from hospital employees.

“As soon as we heard about it we said, `Stop, you don’t have board authority to do that,”‘ Devereaux said.

He said the policy was never ratified by the Board of Supervisors and that County Counsel Ruth Stringer had no knowledge of the practice either.

Supervisor-elect Janice Rutherford said one of her first orders of business when she takes office on Dec. 6 is to begin addressing issues at the hospital. Since August, she said she too has heard complaints from various hospital employees about free medical care extended to county employees and elected officials at the hospital, among other things.

County spokesman David Wert said the hospital could have been providing free medical treatment to county employees for as long as 11 years, when Arrowhead Regional first opened. He said the practice was implemented as an incentive to get county employees to use the hospital.

“It was a business strategy,” Wert said.

He said the hospital kept no records of how many county employees received free medical treatment during the time the practice was in effect at the hospital.

Hospital administrators did, however, provide some kind of ballpark figure to the county.

“The numbers that they gave us did not suggest that it was a large volume (of county employees),” Devereaux said.

He said the hospital administrator/administrators who initiated the practice had previously come from the private sector, where he said it is common practice to waive co-pays for hospital employees and provide them with medical treatments not covered by their insurance.

“There was no intent of wrongdoing. They didn’t understand that what was appropriate in a private hospital wasn’t appropriate at a public hospital,” Devereaux said.

Officials at Arrowhead Regional have refused to identify who implemented the practice at the hospital and when. They also refused to provide their estimate of how many county employees received free medical treatment while the practice had been in effect.

The practice could constitute a violation of federal tax laws because free medical treatment to county employees could be considered a gift of public funds, which has to be reported as income, said one source close to the case who wished to not be identified.

Devereaux replaced Mark Uffer as county administrative officer in January. The Board of Supervisors fired Uffer in November without giving a reason.

Before being hired as county administrative officer in September 2004, Uffer was the medical director of Arrowhead Regional.

Uffer’s attorney, Sanford Kassel, said Uffer never implemented such a policy when he was the hospital’s director.

“Mr. Uffer was shocked to have just learned of this practice!” Kassel said in an e-mail Friday.

The hospital has grappled with other problems this year.

In May, two hospital doctors addressed the Board of Supervisors, alleging neurosurgery patients had received substandard care and that medical director Dev GnanaDev wielded too much power over medical provider contracts.

Dr. David Lanum, president of the hospital’s medical staff, said in a subsequent interview with The Sun that outside experts with no affiliation with the hospital had conducted an unbiased and comprehensive review of the cases and determined the standard of care was met.

On July 1, a new contract went into effect at the hospital that transferred authority to negotiate and award medical provider contracts from GnanaDev to hospital director Patrick Petre, Wert said.

In April, the Centers for Medicare and Medicaid Services, CMS, warned the hospital it was in danger of losing its contract for Medicare and Medi-Cal services if it did not improve its level of patient care.

The federal agency determined the hospital failed to properly screen children for abuse, overmedicated patients with antipsychotic drugs and painkillers and failed to follow proper guidelines for restraining patients, among other things.

The hospital subsequently submitted a corrective plan to CMS., 909-386-3874

Hospital grapples with problems

In the last year, San Bernardino County’s Arrowhead Regional Medical Center has been vexed with allegations of shoddy patient care, conflicts of interest and free patient care to county employees. The following is a list of issues that have made the news this year:

• Nov. 4: FBI agents and district attorney’s investigators raid the hospital, seizing a plethora of documents throughout the all-day operation.

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