Hospital board spinning wheels

BRENT ADDLEMAN Managing Editor
The Somervell County Hospital District's board of directors met last Thursday evening, but no action was taken in a meeting adjourned after board member Ron Hankins, second from right, cited a lack of information on the agenda. From left are Ray Reynolds, CEO of Glen Rose Medical Center; Chip Harrison, board president; Hankins; and Eugene Brode, board member.

Three strikes and you’re out.

The Somervell County Hospital District’s Board of Directors went down looking at the third strike March 26, as the board has now failed to come to a decision in three meetings over a span of seven days.

On March 20, an emergency meeting to adopt an Indemnification Agreement between the hospital and Paul Harper, the board’s secretary, ended in no decision being made. Then a March 21 special meeting was called, and then canceled, and the March 26 regular monthly meeting ended quickly, as board member Ron Hankins cited there wasn’t enough information on the agenda, nor for the public, and the meeting adjourned without any action being taken.

Items on the agenda for the Thursday, March 26 meeting included a “Federal Tax Lien against Glen Rose Healthcare Inc. (501a) for $113,350.36,” and issues pertaining to the code of conduct, bylaws changes, sworn statement from the administrator, pending and current litigation from lawsuits, attorney of record for the district and existing individual cases and the administrator’s employment, evaluation, reassignment, duties, discipline or dismissal; complaints or charges against the administrator.

After hearing the CEO, CFO and various committee reports, Chip Harrison, the board’s president, discussed the Indemnification Agreement and said the board was “awaiting advice from Kevin Reed,” who serves as the hospital district’s attorney.

Hankins then interjected asking where the agreement came from and whether it has been reviewed and approved by Reed before being discussed by the board. Harrison didn’t know where the agreement originated and John Parker, who serves as board vice president, said he “did not generate it himself” and that he suspected “it was a compilation of the insurance company’s requirements” and that he did not “know the answer.”

Harper, when asked where the agreement came from, stated he “drew it up.”

Hankins then asked the board, “If anyone thought of asking Kevin Reed on the advisability or consequences of entering the agreement.”

“Our insurance company that we have had since before we were here requires it,” Parker said in reply.

Hankins asked Parker if he could show him that document, to which Parker said he didn’t “have the insurance agreement.” Hankins then asked Parker how he knew the insurance company required it, and Parker said, “because Paul (Harper) talked to the insurance company.”

Hankins then asked Ray Reynolds, Glen Rose Medical Center’s chief executive officer, if he had any conversations with AIG, the hospital’s insurance company.

“Yes, I have,” Reynolds said. “His explanation was that, No. 1 they didn’t supply the Indemnification Agreement. He did say his conversations with, I guess, Mr. Harper, could have been interpreted that they needed an Indemnification Agreement. But, the Indemnification Agreement per their representative was not required of us for us to be covered by their Directors and Officers' Insurance.”

Hankins asked why the board would even consider entering into the agreement, “I have looked at the Indemnification Agreement, and it is basically a blank check.”

Hankins then cited Article 11, Section 7 of the Texas Constitution, which “prohibits a city or county from creating a debt without first providing for a tax for satisfaction of that debt and a sinking fund.”

Harper tried to stop Hankins, citing a “point of order” that Hankins was “talking about a topic that is not on the agenda.”

“It certainly is on the agenda, Mr. Harper,” Hankins said. “You put up here at the front – the Somervell County Hospital District will convene as posted to consider and take formal action if necessary on the following items. That means everything below this, including executive committee actions.”

Hankins explained a case in Galveston pertaining to the city and a railroad where an Indemnification Agreement was reached but was later considered void.

“My conclusion, and my argument, would be that not even the full board of this hospital district has the authority to enter into an indemnity agreement for anybody, let alone a member of the board,” Hankins said. “Certainly a committee of basically two, since (Paul Harper) has an interest in that would be authorized to enter into that indemnity agreement. But none of you thought to contact Kevin Reed or anyone else to ask before you did it. Therefore, I think it is void.”

Harrison reiterated the board was “working with Kevin Reed.”

Hankins also pointed out that an “order” was “issued” to Reynolds to “issue a check for $25,000 to Mr. Harper.”

“That was nowhere, no notice whatsoever,” Hankins said. “You have no authority, in my opinion, to do that. The bylaws, in fact, I don’t have that section in front of me, require any payment to a board member to go before a board member before it is paid. You didn’t do that.

“At this point, I want to object to the rest of this agenda for insufficiency of notice to the general public about what is to be discussed. I have looked at these items on here, and I don’t even know what they are and I am a board member.”

Board members Brett Nabors and Dr. Karen Burroughs ceded they had no information regarding what any of the topics on the agenda were about, while Parker tried to introduce discussion about the federal tax lien, stating “I do believe I heard something about the federal tax lien.”

Harper said, “If you believe that they are invalid, or lack of description or whatever, I am happy to repost. I am happy to do that.”

Harper then agreed with Hankins' statement that “if the board members don’t know what these items are about, how can the public know?”

Brent Addleman is managing editor of the Glen Rose Reporter. He can be reached at 254-897-2282 or email to brent.addleman@theglenrosereporter.com. Follow him on Twitter: @GRR_Editor.