Audit Denies Invoices by Navigant

Los Angeles County auditors have rejected more than $206,000 in invoices submitted by the consulting firm running troubled Martin Luther King Jr./Drew Medical Center, saying late Friday that the expenses were for unauthorized trips and first-class travel.

The auditors’ action came three weeks after The Times reported that Navigant Consulting Inc. routinely inflated its expense reports by double billing airfares and charging the county for first-class travel and trips unrelated to the hospital. The rejected invoices were more than 15% of the $1.3 million in Navigant’s expenses between November 2004 and June 2005.

In a memo to the Board of Supervisors, county Auditor-Controller J. Tyler McCauley attributed many of Navigant’s errors to differences between the restrictive travel policy used by the county and the company’s more liberal policy. But some were just errors, the audit concluded.

“We found no indication that Navigant intentionally overbilled the county,” McCauley wrote.

McCauley said he had reviewed the results of his audit with Navigant corporate financial staff, and they agreed with its conclusions. A Navigant representative could not be reached for comment Friday night.

The audit comes as Navigant’s one-year, $15-million contract with the county draws to a close at the end of the month. The Board of Supervisors hired Navigant last fall, under pressure from federal regulators, to re-instill accountability among King/Drew employees and correct lapses in patient care, which at times led to patient deaths.

Although Navigant said it had lowered the mortality rate at the public hospital south of Watts, the consultants have acknowledged that the job was tougher than they envisioned. And McCauley’s office has twice issued reports saying that Navigant has not delivered on all of its promises and has overstated its results.

County Supervisor Yvonne Brathwaite Burke, whose district includes King/Drew, said the firm’s billings leave “a sour taste in my mouth.”

“Maybe it was not that they’re crooks,” she said. “It may be that they’re just negligent with their bookkeeping. And that causes concern because they’re there to take care of other people’s bad bookkeeping.”

Supervisor Mike Antonovich said he too was disturbed by the findings, adding that had the audit not been done, “it would have been a major loss of revenue to the taxpayers.”

He accused the health department and its director, Dr. Thomas Garthwaite, of being “asleep in monitoring the contract just as they’ve been in a coma in the oversight of King/Drew Medical Center.”

Garthwaite, who has called Navigant’s billings sloppy, said he did not believe that the firm was out to cheat the county.

The county health department plans to recommend extending Navigant’s contract for several more months, and Garthwaite said he wanted to make the policy for expense reporting simpler.

Rather than requiring Navigant to justify each expense -- and submit receipts to the county -- Garthwaite said he would like to give Navigant a set percentage of its fees for travel and lodging.

That percentage would be based on the expenses the auditor allowed during the first eight months of the contract, Garthwaite said, not on what Navigant billed for.

“I think it will cost them more money because they’ll have to follow their own rules for their employees, but we’re following our rules to reimburse them,” Garthwaite said.

He said the new approach would be a lot easier than “spending all of our time reviewing receipts, adding and subtracting.”