Quorum Health Group was hired to bring expert management to 57-bed Paulding (Ohio) County Hospital. But some local residents contend the nation's largest hospital management company instead brought them grief.
Three weeks ago, the public hospital's board received 571 signatures on a petition asking for early termination of Quorum's five-year management contract, worth more than $1 million. The contract was signed in February 1993.
So far, neither Quorum nor the hospital board has acted, but opposition to Quorum has mounted in the rural county of 20,000 in northwest Ohio.
In July, Quorum fired its administrator at Paulding, Laris Keefer, 45, after a newspaper, the Paulding County Progress, reported that Mr. Keefer hired a friend with questionable credentials to be the hospital's human resources director and maintenance supervisor at a salary of $36,000 a year. The board fired the friend, Bill Herdman, on July 7.
According to the Progress, when Mr. Herdman's educational record did not check out, he said he could not disclose his background because he is a "ward" of the U.S. Justice Department. The statement suggested he was in the government's witness-protection program, which hides informants.
The community later learned that Mr. Keefer had put Mr. Herdman on the payroll at Mena (Ark.) Medical Center, his previous post. The Mena hospital commission ordered Mr. Keefer to fire Mr. Herdman, which he did only after refusing initially, said Joe Mannon, who was commission chairman at the time.
Mr. Mannon said Mr. Herdman's management style created "a climate of stress and fear among employees."
Messrs. Herdman and Keefer could not be reached for comment; both have unlisted telephone numbers.
Jim Phillippe, group vice president of Quorum Health Resources, said Quorum was told that Mr. Herdman was fired in Mena because of a work-force reduction. He said the company does not have time to review appointments of department heads by its chief executive officers.
Quorum critics in Paulding have other complaints, some dating before the contract was signed. They contend that fees are excessive, that Quorum's loyalty is to its shareholders, and that its suppliers charge too much.
The hospital is paying Quorum $157,000 a year, with annual increases for inflation, plus $65,000 for an administrator's salary.
"The employees are upset because a stand-alone administrator could have done just as much for the community for less money," said Chuck Fowler, who recently quit as the hospital's director of pharmacy.
"A profitable year for us is $200,000, and we'll be paying out more to Quorum in fees and salaries," Mr. Fowler said.
Mr. Phillippe said Quorum's purchasing program-which is voluntary-offers "probably unparalleled" savings. He said Quorum has no complaints from the other 260 hospitals it manages.
Mr. Phillippe said Quorum is trying to determine why the hospital lost money-$94,063 in the first six months of 1994. The daily census dropped to 5.9 from 8.5 last year.
He said Quorum does not intend to leave. "It takes a while to get optimal operations, and that's why we sign multiyear contracts."
Quorum officials said hospital employees are unhappy that the company is changing the command structure. In May, for instance, two supervisors, both long-time employees, were fired.
"We're asking for accountability from the work force, and some people aren't happy with the change," said Jim Klun, who replaced Mr. Keefer as the interim administrator.
Mr. Klun characterized the opposition as a small but vocal group.
Quorum's opponents include three of the five family physicians on staff, most hospital department heads and employees, and two of the three county commissioners, Mr. Fowler said.