Sandy Hardy reveals his next move to Beaufort County Now | Eastern North Carolina Now

     In an exclusive interview with Beaufort County Now, Beaufort Regional Health System hospital board Chairman Sandy Hardy revealed his plan to attempt to regain an element of trust among board members, following an assault by the new board majority on the integrity of a deal he orchestrated with University Health Systems to manage the hospital as it attempts to find a long-term partner with which to affiliate.

    Hardy’s plan is to overtly surrender the fate of hospital management to the power of the new board majority (which, in essence, was inevitable)—consisting of Hood Richardson, Alice Mills Sadler, Clifton Gray, Allen Roberson and the crucial new member, Brenda Peacock—by promising them the chance to vote to approve or dismiss the interim CEO suggested by UHS.

    “I’m going to give the full board the opportunity to approve this interim CEO in the spirit of unity and the prayerful hope that people will start thinking about health care in this community and not their little feelings being hurt,” said Hardy.

    The new majority attempted to hold a special meeting Tuesday, to vote down board member Jack Piland’s June 29 motion “to bring in UHS as an interim management team…as soon as possible.” Hardy canceled Tuesday’s special meeting on the grounds that it was improperly called.

    According to statements made by Gray, Sadler and Richardson, at yesterday’s press conference, which took the place of the canceled special meeting, the new majority will take up the matter Tuesday at the regularly scheduled hospital board meeting.

    Originally, Richardson, Sadler, Gray and Roberson ineffectively voted against the old majority—consisting of Hardy, Jack Piland, Grace Bonner, Curtis Potter and Sandy Easley (who was replaced by Peacock)—on the ground that hiring UHS as interim management would cause perception of a conflict of interest among the hospital, UHS and other parties interested in leasing the hospital. They also were against voting for outsourcing management, for an undisclosed fee.

    Since then, in their opinions, Hardy has substantively changed what was voted on: from hiring a UHS management team to asking UHS to locate an interim CEO for the hospital.

    “Somehow, without board approval, the action plan was changed. And that should not be possible without approval of the board. No one member can act in the interest of the board like that unilaterally,” said Sadler, at yesterday’s press conference.

    The first revelation of this change in plans came a day after the vote was taken in a June 30 press release from Hardy, which stated:

“Under the proposed arrangement, UHS would provide an interim CEO, who would oversee day-to-day operations at the hospital. The two organizations are finalizing details of the agreement, including financial terms. UHS will not be managing day-to-day operations at Beaufort County Medical Center, and the interim CEO will be restricted from sharing confidential information with UHS.”

    The second revelation came in the form of an e-mail to the board on July 2 from UHS’s Dave C. McRae, which stated, among confirmations that UHS would only be locating an interim CEO for the hospital, rather than acting as interim CEO:

“UHS has not been asked to provide management services. No management arrangement between UHS and Beaufort County Medical Center has been contemplated or offered.”

    It is a recorded fact that before the vote on Piland’s motion, the board’s discussion centered on hiring UHS as an interim management team, handling the hospital’s day to day operations. There was no talk of a third party.

    In yesterday’s interview with Hardy, he said that BRHS was “to seek assistance with UHS in the management of this hospital,” not “bring in UHS as an interim management team” as Piland’s motion stated.

    But in a June 29 interview with WITN, following the vote on Piland’s motion, Hardy clearly stated that UHS was going to be brought in as management.

    “I’m going to go meet with them tomorrow. And the motion that passed was to bring them in to manage the hospital as soon as possible,” said Hardy. “I think with University Health Systems coming in to manage this hospital, people can be confident coming here for their health care.”

    In yesterday’s interview, Hardy said he resented the new majority’s lack of understanding and gratuitous disagreeability with the implementation of the motion, which didn’t substantially alter its purpose. He said “all five members who voted for the motion understand it. The hospital attorney understands it.”

    After prefacing his statement with a disclaimer—“I want you to put down that I’m speaking generally, because this crowd’s crazy”—Hardy explained it thusly:

    “UHS was to assist us with a leadership team. We were to seek assistance with them in the management of this hospital—the assistance they suggested is that we need an interim CEO.”

    He emphasized that carrying out of the motion was not a political matter, to be revisited by the board, but one to be dealt with by management.

    “Boards set policy. Then policy is implemented by the executive area and the administration. We don’t have a CEO to implement this policy. I was given authority,” said Hardy. “The hospital attorney agrees with this. The hospital policy doesn’t have to be set out in detail; it has to be set out generally. Boards do not micromanage policy.”

    When asked why BRHS couldn’t hire their own interim CEO, even if it’s not a current employee, Hardy said that it would take too long.

    “Because it can be done much more quickly with their resources, and skills, track record and experience,” he said. “We don’t have time to have a search committee and everybody having a good little time having their meetings.”

    He said he and UHS already have someone in mind and could present it to the board at the regularly scheduled meeting on Tuesday.

    “I’m getting their curriculum vitae and we’ll present it to the board,” said Hardy. “I am concerned that they will reject it just because it’s not their idea. I hope that they will behave more responsibly.”

    The board may never have a chance to vote on Hardy’s personnel recommendation, as the new majority could go forward with voting down Piland’s motion in its entirety on Tuesday. According to Richardson and Sadler, the board was advised by a consultant that it wasn’t in the hospital’s best interests to hire an interim CEO, even if there were no conflict of interest or concern over cost, as long as the hospital is uncertain whether it’s going to merge or stay independent. Both Sadler and Gray, at Tuesday’s press conference, expressed their hopes of going back to the hospital’s executive management succession plan, which had placed BRHS Medical Practice Administrator Susan Gerard at the helm following CEO Bill Bedsole’s resignation. They said hiring an interim CEO would roughly cost the amount of Bedsole’s parting salary, which was around $250,000 a year. Hardy said the same to Betty Gray of the Washington Daily News in his June 29 press conference.

    “What we had intended was to possibly suspend any search for outside management and continue with our succession plan,” said Sadler. “It is definitely still an option, because, like I said, we don’t want to duplicate cost. When you start talking about top management, you’re talking about an agency, a board that laid off, say, a $25,000 a year painter; and you’re talking about taking on the expense of a $20 to $25,000 a month CEO. What sense does that make? We’re trying to make sure that it’s not cost prohibitive. We have, hopefully, the talent on our staff that can run this hospital for the short term that we’re thinking of either recovering economically or partnering.”

    Gray echoed Sadler’s sentiments:

    “I know I’m confident in the staff we have here. We should be confident that they can carry on the day-to-day operations under the succession plan, otherwise there would be no reason to have a succession plan,” he said. “I think Susan Gerard is very capable of continuing to manage the hospital. We’ve just got to find a way to get our billables paid more quickly. I think we’ve got a problem with respect to sending out bills, but at the top level I’m very confident in Susan’s abilities and her team. No need to spend another $250,000 if we don’t have to.”

    When asked if the hospital would go back to being managed under the succession plan, if the board voted down his pick for interim CEO, Hardy replied:

    “I guess we would immediately, if the board takes no other action. I’d hope they’d take some other action.”

    During Tuesday’s press conference Sadler tried to reassure UHS, as a potential bidder for lease of the hospital, that the board is looking out for their reputation as well as the interests of the hospital and other bidders in trying to prevent a conflict of interest from forming. She also said that all board members would welcome a partnership with UHS if it eventually comes to that.

    “This board in its entirety or in part has no problems with United Health Systems. If anything, we’re trying to make sure that they are not a part of anything that looks in the least bit conflict, so that no one will think that they are operating in a manner that is distasteful,” said Sadler. “We would like to protect UHS and all interested parties from any scrutiny with regards to how they may be perceived in trying to seek an award of a partnership with us.”