KSBW: Union calls for 2 SVMH board members to resign

NewsMarch 12, 2012

KSBW, 2:07 PM PST Mar 09, 2012

SALINAS, Calif. – The day after a state audit blasted top management at Salinas Valley Memorial Hospital, the healthcare workers’ union called on two members of the board  to resign Friday.

National Union of Healthcare Workers leaders said SVMH Board of Directors member Harry Wardwell and president Jim Gattis should step down from their posts.

An audit released Thursday zeroed in on financial dealings between former hospital CEO Sam Downing and First Capital Bank, as well as the board’s dealings with Rabobank, where Wardwell is a top executive. 

The union is calling for Gattis’ resignation because of his and Wardwell’s relationship with Rabobank, the California International Airshow and the California Rodeo. 
The Salinas airshow was founded by Gattis, and Wardwell serves as the airshow’s executive director.

The state audit found that Wardwell rightly recused himeself from any board votes dealing with Rabobank and committed no actions which reflect a conflict of interest.

Gattis did not immediately respond for comment, and Wardwell said he will not resign.

Salinas Valley Memorial Healthcare System paid $21 million to firms over five years, some of it in apparent violation of conflict-of-interest laws, according to the audit. State investigators found 11 cases where board members received stocks or other payments from vendors doing business with the hospitals.

In addition, the audit exposed violations made by the board of the Brown Act, which requires certain decisions to be made in meetings open to the public. SVMH responded to the state audit with a letter written by Gattis.

“The Bureau of State Audit report contains some conclusions with which we simply disagree. It is our belief and that of our legal counsel that auditors reached some conclusions without analyzing readily available details that provide a more complete picture of the issues,” Gattis wrote.

“The BSA did not express any concern with the quality of our patient care at Salinas Valley Memorial. In fact, the auditors noted that the quality of the patient experience did not appear to suffer as a result of our recent initiatives to reduce costs in order to remain financially viable,” Gattis wrote.