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Hospital's CSO steps down

By Kayla Carter
Staff Writer
[email protected]
The Unicoi County Memorial Hospital Board of Control unanimously voted to accept Jim Pate’s resignation as chief executive officer, effective July 9, at a meeting held Monday night.
Chairperson Todd Love asked the board to review and give feedback about a letter addressed to the board from Pate, which outlined his terms for resignation.
After the board members had finished reading the letter, board member Jimmy Erwin made a motion to accept the resignation. Board member Sue Jean Wilson seconded the motion, but both withdrew their motions after a discussion about the length of time Pate asked to remain employed by the hospital.
“I don’t have any problem paying him up through that date there,” said Russell Brackins, board member. “There were reasons. It wasn’t sick leave as stated in the paper there. That didn’t have anything to do with it and he understood that.”
Brackins explained that those involved in the executive session had other reasons than “health problems” for putting Pate on administrative leave.
“I do think we will have potential problems with having an effective date of Aug. 22 for his resignation,” Brackins said. “We did talk to Mr. Pate and gave him the reasons for [the administrative leave]. He did understand at least what I thought was the feeling of the board here that he would not be coming back.”
Erwin began to initiate a new motion, which extended Pate’s administrative leave until Aug. 22, but Brackins said that the issues regarding allowing Pate to remain an employee until that date involved insurance coverage.
“That’s the same situation,” Brackins said. “He’s still an employee after that date and if he’s sick or has an accident or anything then … I have a lot of empathy for Jim.”
Later, Brackins noted “If we accepted that effective date then he is still the CEO.”
Erwin asked the board if his medical insurance was the issue and inquired about allowing him to remain on the insurance until Monday. “I don’t think legally we could do that,” said Chief Financial Officer Toni Buchanan. “Once he is terminated he could carry COBRA [Insurance], which is what every other employee has to do.”
Wilson said she seconded the motion so the board could discuss the situation.
“Each of you know how I felt for several months,” she said. “I think now is the time to set sail on a different ship.”
After considering the issues of allowing Pate to remain CEO until Aug. 22, Love left the boardroom to call Pate from his cell phone as requested by Brackins.
“I would certainly concur and I’d make the motion, if you got ahold of Mr. Pate on a telephone right now and he’d make his resignation effective … July the 9 then we would give him severance pay equal to all the benefits and he would accrue up to Aug. 22,” Brackins said. “I think that’s fair with the understanding that we had with him.”
Love said that he did not have service in the boardroom so he must step out of the room.
When he came back after about a minute, Love reported that Pate had agreed to the terms highlighted in the motion made by Brackins and seconded by Wilson.
“I stated that there would be no health insurance after today,” Love said. “He said he would re-draft us a letter or me a letter just changing the date on this to July 9.” Love clarified to say, “Mr. Pate stated to me over the phone that he would change his date [of resignation] to July 9 as his effective resigning and that all benefits would be paid except for health insurance, which would go off as of tomorrow.” The severance package, or benefits, amount to $29,114.66, Love said.
The board unanimously voted to accept the amended resignation letter, which includes an effective resignation date of July 9, and Pate’s benefits will be paid out until Aug. 22, excluding health insurance.
The board also approved the contracts for Spectrum Health Partners LLC to conduct its operational review as well as allow an interim consultant CEO to oversee operations for 30 days.
Love said the board had looked over the contract for the consultant firm during a planning session and they have already been to the facility this week to do preliminary audits.
Erwin City Recorder Randy Trivette said that the contract states that the evaluation would take 45 to 60 days to complete, but they should receive preliminary evaluations before that.
“We’re expecting 10 days to two weeks to have our first report of the direction of the hospital,” Trivette said.
The consultants will be working with the hospital to complete an overall strategic review, financial statement review, revenue cycle review, labor review, physician/non-salary review and physician practices review.
Love said that the contract requires the hospital to pay the contractors an hourly rate, not to exceed a total of $60,125, as well as expenses. The board unanimously voted to adopt the contract.
The board conducted a roll call vote regarding the implementation of an interim CEO to take over responsibilities given to Buchanan during Pate’s leave. The vote came back 5-2 with dissenting votes from Erwin and board member Glenn Tilson.
Buchanan adamantly asked the board to explain how they were going to fund either of the contracts. “How are we going to pay these people?” she said.
Trivette said that the interim CEO may pay for himself through guidance. “If you look back, you guys were notified at the end of May of the financial problems and you were like $1.2 million in the red,” he said. “That’s when you approached the city to get $800,000. Well, that’s been a month and a half ago and now you’re $1.4 million in the red. You can’t continue to go the way you’ve been going. Something’s got to change.”
Brackins stated that he did not think the hospital was in any financial position to appoint the interim CEO, but the board still needs to look out for the best interests of the hospital.
Jete Edmisson will serve as the hospital’s interim consultant CEO through SHP effective July 10. The board stated in the final motion that Edmisson is to serve for 30 days as interim CEO and the contractual agreement states the hospital is to pay him $25,000 for the month he will be employed by the hospital.