Execs misrepresented New Mexico hospital’s finances, audit finds: ‘Trustees didn’t get an accurate picture’ – Becker’s Hospital Review

An audit requested by the governing board of Gila Regional Medical Center in Silver City, N.M., found that several systemic management and oversight issues contributed to its financial woes, according to the Silver City Daily Press

The audit, unveiled last week and prepared by Dingus, Zarecor and Associates Certified Public Accountants, was requested by the governing board after it took over the county-run hospital last spring.

The audit covered the 2019 and 2020 fiscal years. The audit found the medical center had net losses of $19.1 million in fiscal year 2020 and $11.1 million in fiscal year 2019. Additionally, its current liabilities are about $21 million. As a result, the audit questioned whether the hospital could continue operating.

Gila Regional Medical Center Governing Board Chair Alicia Edwards told the Daily Press that former hospital CEO Taffy Arias and former CFO Richard Stokes were responsible for providing trustees with an accurate picture of the hospital’s finances but the audit found that they never did. 

“Essentially what that did was keep people from understanding how serious the financial problems were at the hospital — trustees didn’t get an accurate picture of that,” Ms. Edwards said.

In addition, the audit found that the board of trustees “didn’t hold management accountable and require changes in operations to stabilize the medical center’s financial condition.”

The medical center’s new CFO, Gregory Brickner, said that there is a corrective action plan in place to address all of the audit findings.

Gila Regional last year contracted with consulting firm HealthTechS3 to help it conduct a financial turnaround. The company plans to conduct an evaluation of productivity and staffing, enroll in a group purchasing organization and convert the hospital to a critical access hospital to obtain more funding.

Ms. Arias stepped down from her role as CEO Feb. 14, during her already scheduled leave of absence. The board said at the time that Ms. Arias wasn’t asked to resign. 

Read the full report here

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