NHS CEO: City officials need to be 'educated' on hospital matters

Keri Thornton | Daily Press

Northeastern Health System CEO Brian Woodliff addressed the Tahlequah City Council on Tuesday, Sept. 7, and cleared up claims made by city officials.

The public witnessed a protracted game of "he said, she said" between city and hospital officials during a Sept. 7 Tahlequah City Council meeting, with the mayor and hospital CEO leading the fray.

Mayor Sue Catron said she wasn't aware a task force had been created to work on issues between the city and the Tahlequah Hospital Authority.

"We're here because of something that started 2-1/2 years ago with a request to appoint a single trustee. We have not in 2-1/2 years been able to get to the point where we can talk about appointing a single trustee," said Catron.

She was referring to the fact that hospital officials seem reluctant to allow her to replace trustees, although the mayor is specifically given that authority.

Ward 3 Councilor Stephen Highers, who is a trustee on the THA, told Catron her statement that she was never given a name of a possible appointee was incorrect, since she was given a name of someone who was already a trustee.

It was then that Northeastern Health System CEO Brian Woodliff approached the podium to offer clarifications to statements made during the meeting.

"I think since we haven't had the time to influence the people you processed this with, I probably need to help you and others understand some of the facts," Woodliff said to Catron. "When we sat down two years ago, it was a great pleasure that you won mayor, and we congratulated you and began an orientation."

Woodliff said that Catron herself applied to be on the THA shortly after taking office in 2019, and that was the first intended member appointee.

"We said, 'We want you,' and that was me delivering the message of my board members. We think you're highly qualified and we'd love for you to participate," he said.

But Highers had objected at the time, saying the trust indenture stated the seat was to be filled by a council member, not a member of the governing body.

"We want to communicate the spirit of our board of collaboration in including you. That was all following the 2010 trust indenture. The 2010 trust indenture does not have term limits and never had back in 1974 and 1986," said Woodliff.

City councilors adopted a resolution that called for a second amendment to the indenture during an Oct. 4, 2010, meeting. The amendment was previously adopted by the THA board. Woodliff said city and hospital officials have followed that amended indenture in good faith for 11 years.

But the mayor read from a letter from Hilborne & Weidman, P.C, which stated the amendment wasn't properly executed or enacted.

"Attempts by both the city and the city hospital authority to ascertain any other document pertaining to the attempted second amendment were unproductive. Our opinion is based upon the assumption that the sole document attempting to amend the trust indenture a second time is the resolution," Catron cited.

Catron said there are items in the 2010 trust indenture that legal counsel believed didn't fall under state statute, and therefore Woodliff said she wanted to modernize the document.

"In the spirit of correcting the trust indenture, we have been sending drafts to [the city] over time, and each time we figure out that we've guessed wrong through interesting ways. Not from a letter that says, 'How about you think about this, this, and this.' We hear it through rumor, innuendo," said Woodliff.

The CEO said hospital officials believe the city needs to be "educated" on the trust indenture.

"The accountability piece, our institution follows the Governance Institute Principles. It is the most respected best practices for governance of nonprofit hospitals," he said.

NHS is regulated annually and inspected by the Oklahoma State Department of Health and the Centers for Medicare & Medicaid Services. NHS is audited annually by the Occupational Safety and Health Administration, as well as the U.S. Drug Enforcement Administration and Department of Environmental Quality.

"There is a tremendous amount of accountability and our board meetings are open, and the financials are shared with this council, with the mayor, with the assistant administrator," Woodliff said.

Because questions arise, Woodliff said, invitations were extended to Catron to sit on the Hospital Foundation board. However, Catron denied that happened. Ward 4 Councilor Trae Ratliff now sits on the board of the Hospital Foundation.

Catron also claimed she never got answers when she asked Woodliff what property was under a lease, and what debt was on the property. Woodliff insisted he never received correspondence from the mayor stating the documents he provided were incorrect.

"She gave me until May 14 to provide the information. It was provided in writing, with external audits. It was produced in a way that we thought was legible and met every element," he said.

Woodliff said a first step in solving the miscommunication problem is for officials to attend NHS board meetings.

"I've negotiated with some of the hardest people in the world to negotiate with, and I've never experienced this lack of communication, or understanding, or appreciation," said Woodliff.

The floor was turned over to Karen Rieger, attorney for Crowe & Dunlevy, and she said they've worked with NHS on health care legal issues for several years. Rieger explained what a public trust is and how it operates. Trusts were created as a mechanism to allow communities to incur indebtedness for more than a year to acquire capital needed to build new facilities.

"It's a statutory entity that's separate from the city, and the city is not liable for the operations of the business of that public trust," Rieger said.

Catron said she was afraid the city would "ram through" another trust indenture that doesn't conform to state law or doesn't allow the city to protect its assets.

The mayor accused Highers of not telling her if he had any updates pertaining to the hospital, but he countered that he advised her a task force group had been created. He added that everything being discussed could have been done in an email instead of in a public meeting.

The lack of communication between the mayor and councilors seemed to have hit the mark after Catron reiterated she was not aware of a task force being created.

"We all are ... here to do our very best job protecting our community," Catron said.

Highers fired back that he didn't think they were all on the same page, since they don't remember things the same way.

City Attorney Grant Lloyd told the board he wasn't aware of the task force group, either, until he heard about it from Highers earlier that day.

"There definitely is a miscommunication if all of the players have to be involved at a certain meeting," he said.

NHS EMS Director Mike Cates said it was obvious the mayor and councilors weren't communicating properly, and they should do so before bringing such a controversial topic to a public forum.

"What I would suggest is you have a little better support from your council members because you all aren't even on the same page yet," said Cates, and told Catron: "I felt like you're attacking Mr. Woodliff personally."

Catron intended to appoint Bob Girdner to replace Judy Williams on the THA. Bobby McAlpine was to be named to replace Susan Chapman Plumb, and Dr. John Galdamez would replace Dr. Charles Gosnell. Those three items were removed from the consent agenda earlier in the meeting by Ward 2 Councilor Keith Baker, Highers, and Ward 4 Councilor Ratliff.

Lloyd asked what appointments the THA submitted to the City Council for approval since the 2010 amendment. He suggested the "estoppel theory" hadn't been followed, since Catron would have been appointed to the THA, but Highers was appointed instead.

The estoppel theory is a principle that prevents someone from arguing or asserting a right that contradicts what they previously said or agreed to.

"The City Council approved the amendment at the time. The board of trustees approved it at the time [and] everyone agreed that was how the parties wanted to operate," said Rieger.

Rieger said estoppel could be enforced against the city, since it was the city that voted in favor of the amendment in 2010.

Lloyd then said it was prudent to take no action regarding the appointment of the three trustees.

What's next

The City Council special meeting is Sept. 20, at 5:30 p.m. in the council chambers at City Hall.

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