Fletcher Allen Health Care, Burlington, Vt., has placed CEO William Boettcher on administrative leave and said the state attorney general's office is investigating "regulatory compliance" issues at the 510-bed hospital. Fletcher Allen said an ad hoc committee of hospital board and community members is conducting an internal investigation as well and would publicize the results when the investigation concludes.
"Our primary goal now is to restore public confidence in the hospital," Fletcher Allen spokesman Jason Gibbs said. The committee is expected to complete its work by September.
The hospital recently won state certificate-of-need approval for a $55 million parking garage some 15 months after construction began. Officials had contended the garage didn't need a CON because it was being built and financed by a third party. In a settlement with the state, Fletcher Allen agreed to pay $320,000 for administrative fees and to cover the state's costs.
On Wednesday the board placed Boettcher, 54, on paid leave and named Fletcher Allen COO Thad Krupka to act as interim CEO. Boettcher has been CEO since 1998.
In an interview with Modern Healthcare's Daily Dose, Vermont Deputy Attorney General J. Wallace Malley confirmed an investigation is underway that "includes the parking garage and computer upgrade issues, but it would be inappropriate for me to characterize the scope of the investigation beyond that."
He later added, "There's been information that continues to come in from various sources and it has prompted us in the past week to actually increase our level of review of this whole thing."
Vermont had little choice but to grant the garage a CON after Fletcher Allen finally applied, state healthcare regulator Elizabeth Costle said, because a denial could have put the hospital in a default on tax-exempt bonds and jeopardized its $173.4 million renovation. "The downsides of stopping the project were too high for the state," Costle said.
Compounding its problems with regulators, Fletcher Allen apparently purchased and began installation on a $9 million software project without CON approval, prompting the state to order an immediate halt to the activity in a July 18 letter. "The department is not waving rights. It may have to impose sanctions for FAHC's actions in furtherance of the project without the required CON," Costle said in a written statement. She told the Daily Dose that the state had yet to receive a CON application for the software project.
Fletcher Allen officials said in a written statement that they originally viewed the software installation as multiple projects below the CON threshold because it involved replacing of 11 software modules, "each of which can and does function independently of the other." Hospital spokesman Gibbs said installation was stopped after the state's complaint and the hospital would submit a letter of intent for a CON in "the next few months."