King/Drew Fix-It Firm Is Faulted

By Tracy Weber and Charles Ornstein

Sept. 23, 2005 12 AM PT

Times Staff Writers

The consulting firm brought in to fix years of mismanagement at Martin Luther King Jr./Drew Medical Center has routinely inflated its own expenses by double-billing airfares and charging Los Angeles County for first-class travel and trips unrelated to the hospital, the firm’s records show.

A Times review of expense reports submitted over eight months by Navigant Consulting Inc. found a pattern of liberal spending normally off-limits to those working on the public dime.

Moreover, the review found haphazardly compiled, sometimes indecipherable records, including a contradictory accounting of how many hours Navigant staffers actually worked at the county hospital south of Watts.

Late Thursday, weeks after The Times began to inquire about discrepancies in the billings, the head of the county Department of Health Services said his agency planned to reject more than $300,000 of the firm’s $1.3 million in submitted expenses. Navigant can appeal.

The consulting firm is under a one-year, $15-million contract to turn King/Drew around -- in particular, to re-instill a sense of accountability among employees, who serve a largely minority, impoverished population around South Los Angeles.

Navigant’s project executive at King/Drew, Kae Robertson, repeatedly has assured the county Board of Supervisors that her firm is whipping the troubled hospital into shape. But when it comes to her own expenses, it appears the company has not been so rigorous.

Examples, culled from invoices and backup materials obtained by The Times through the California Public Records Act, include:

* On Feb. 1, the same day a national accrediting group withdrew its seal of approval from King/Drew, Robertson took a one-day, round-trip flight to Honolulu. Navigant billed the county $1,088. The trip, however, was for another Navigant client, Robertson confirmed this week.

* Robertson bought a $548 round-trip ticket to Washington, D.C., leaving the next day, Feb. 2. The trip was billed to the county, even though she said she never took it.

* The following week, Robertson flew from her Rochester, N.Y., home to L.A. After three nights in town, she headed to her second home in Fort Myers, Fla. Navigant charged the county twice for the same $1,588 ticket.

* Navigant also billed for Robertson’s frequent first-class or high-priced travel, including a $2,425 round-trip ticket from Rochester to Washington, D.C. (with no stop in Los Angeles), before the King/Drew contract started.

Dr. Thomas Garthwaite, director of the county Department of Health Services, said his agency already has reimbursed Navigant for nearly $65,000 in expenses, but upon further review would seek to recoup about a quarter of that.

Garthwaite called the firm’s billing “sloppy” and said that if he worked for Navigant, he would tell its board: “We have work to do.”

In an interview, Robertson acknowledged that some of Navigant’s expenses had been billed improperly -- including some of her own. But she said they were mistakes and blamed Navigant’s accounting office and the county’s insistence on cumbersome paper receipts. Most clients, she said, are content with the firm’s electronic billing.

Hank Wells, a Navigant managing director who shares oversight of King/Drew with Robertson, said the two of them ultimately should have made sure that errors weren’t occurring. And he conceded that the discrepancies in the firm’s billings could erode confidence in its ability to overhaul King/Drew.

“I guess your point is, ‘If you’re sloppy in that, what else are you sloppy with?’ ” said Wells, who has been serving as King/Drew’s acting chief executive. “I wish I knew how to mitigate this concern, but there are errors.”

At times, the charges appear not so much erroneous as inexplicably wasteful. For instance, a nursing consultant, Lisa Branciforte, lives in San Diego yet spent up to $500 a week to fly to Los Angeles and back, plus about $180 a week in cab fare to and from the airports.

Wells, who spoke on behalf of his team, said Branciforte often had to come to town on short notice. Driving would take too long, he said, and the train is “awful ... I wouldn’t take the train.”

In general, he said, Navigant would fight the rejection of such charges, as long as they are not mistakes. Such expenses are routinely accepted in the private sector, he said. “Nowhere in here does it say, ‘Find the least possible expensive way of doing something,’ ” Wells said of the agreement with the county.

In fact, the county allowed Navigant to set its own expense policy. The firm submitted a half page of broad guidelines that limited staffers to moderately priced cars and coach-class travel. It did not specifically address what would be considered reasonable costs.

Navigant was hired last fall, in part to restore credibility and integrity to King/Drew’s operations. The firm has recommended that hundreds of King/Drew employees be disciplined for shoddy work habits, lapses in medical care and fraud, including allegedly lying on timecards.

The disclosures of its own billing lapses come at a sensitive time for Navigant, a publicly traded company that consults for hospitals, government agencies and private corporations nationwide. Its contract at King/Drew is up at the end of October, and county officials now are debating whether to extend it in some form.

Many of Navigant’s stated goals at King/Drew remain unmet. Key among them is regaining the seal of approval from the Joint Commission on Accreditation of Healthcare Organizations, which was revoked Feb. 1 because of medical lapses and other issues found during a review of the hospital last year.

The county had hoped to be ready for review by the accrediting group by the end of December, but that could now be delayed because some problems have yet to be corrected, county and Navigant officials said.

Navigant also has not resolved the concerns of federal regulators, who repeatedly have cited King/Drew for patient-care failings and have threatened to cut $200 million in annual funding -- about half the hospital’s budget, county officials said.

In June, the county auditor-controller criticized Navigant in a report, saying the firm had failed to act on some of the “urgent” recommendations it had promised to address by Feb. 28. Auditors also found that “Navigant has not appeared to provide the required full-time, on-site staff.” The firm disputed the findings.

The Times’ review found conflicting accounts of how much time Navigant employees spent at the hospital. For example, in one report, Navigant claims its pharmacy specialist worked 21 days in January (at a cost to the county of $43,929), yet in a separate invoice the firm billed for only 10 days’ worth of meals.

The amount of money at stake is not trivial. The work of Navigant staffers is billed at $30,000 to $67,500 a month, depending on the position. The charges are pro-rated based on the number of days the employee actually worked.

Wells said he is confident Navigant staffers were working on behalf of King/Drew on all of the days billed, even if they were not in Los Angeles. The county health department says that under the terms of the contract, consultants in management jobs must be on site to be paid.

A precise accounting of Navigant’s inappropriate charges is difficult to achieve.

Navigant’s method of totaling expenses often consisted of attaching pieces of adding-machine tape to a disorganized packet of receipts.

The stacks submitted on behalf of quality-improvement consultant Debora Hays, for example, are riddled with airline ticket change fee charges, double-billed cab fares and overlapping flights without indicating which, if any, were taken.

Robertson’s April invoices contain receipts totaling more than $12,000 in airfare, often with no indication of the flights’ destination. Navigant billed for $6,534 of that sum, leaving questions about some of her flights.

Luxury was not ruled out.

Pharmacy advisor Anita Groves’ rental car bills show she kept her intermediate-class rental car one November week, but upgraded Friday morning, billing the county a total of $256.24 for a Cadillac over the weekend. Sunday night, her rental car bills show, she traded back down to an intermediate car.

While conceding his firm had made some billing errors, Wells said other disputed charges are the result of confusion over differences between Navigant’s own detailed internal policy and what it worked out with the county.

Emergency room consultant Deborah Hunt, for example, regularly bumped herself up to first class, toting up at least $1,620 in upgrades alone. Navigant passed these charges on to the county.

Other consultants’ expenses include bills for their spouses to fly to Los Angeles -- instead of the consultants flying home for about the same price.

Navigant’s policy allows first-class travel on long flights and spousal travel. The policy the firm agreed to follow at King/Drew does not.

“The question of upgrading your air ticket across the country is not an issue in the private sector,” Wells said. “The question of your spouse traveling instead of you wouldn’t even come up.”

Other billings, he said, are judgment calls. “What’s reasonable to some people may not be reasonable to other people,” he said.

Margaret Price’s charges might be a case in point. Instead of taking a taxi or turning in her rental car during trips home, the Navigant nursing consultant repeatedly parked it in Los Angeles International Airport’s most expensive short-term lot, twice racking up parking bills of more than $300 each -- on top of her monthly rental car fees.

Even after inquiries last month from The Times and a memo from the health department challenging various billings, Navigant continued to submit questionable expenses.

Included in a group of invoices submitted at the end of August: a bill for chief nursing officer Kathy White’s 2 1/2 -day trip to Kauai in June, charging the county for $400 of the nearly $750 ticket. Wells said White believed the county’s share was equal to a weekend flight to her New Mexico home.

And on behalf of Robertson, Navigant billed for a one-way, first-class ticket to Philadelphia.

The tab: nearly $1,180.

(BEGIN TEXT OF INFOBOX)

Overcharges

In early February, Navigant Consulting Inc. improperly billed Los Angeles County for three flights booked by Kae Robertson, its project executive at Martin Luther King Jr./Drew Medical Center.

Feb. 1

Ticket: L.A. to Honolulu, round trip

Amount: $1,087.50

Problem: The flight was for another client.

Feb. 2, Feb. 3

Ticket: L.A. to Washington, D.C., round trip

Amount: $548.40

Problem: Robertson never took the flight.

Feb. 7, Feb. 10

Ticket: Rochester, N.Y., to L.A. / L.A. to Fort Myers, Fla.

Amount: $1,587.81

Problem: The ticket was billed twice.