CHC and ICS Deal: More Sketchy by the minute

May 3, 2012

I realize that things are done "differently" in the CNMI, but seriously the CHC mess is like watching a train wreck.  Additionally, some of the characters involved are outright sketchy while others appear confused or desperate.

The International Consulting Services (ICS) billing contract in no way appears legitimate and beneficial to the CHC or the CNMI people.  There are hundreds of already legitimate and well-established billing companies that CHC could have contracted, but the administrators and some cheerleading physicians have insisted that they must land a deal NOW with ICS, the Idaho company formed in haste only to land a contract with CHC.  ICS has no previous clients, therefore the quality or legitimacy of their work cannot be verified.

This contract has so many unanswered questions.  Do they even know if they have qualified personnel to conduct the billing that the company is to be contracted for? Who are they? What are their credenitials and experience?

Only in Saipan would physicians appeal to an entire community in a letter that lays out an ultimatum ––"either you back an illegal contract that is sketchy at best, or we walk." Rather than laying out the facts and outlining why ICS should be contracted over any other billing company, the pair resorted to "either, or" threats.  The Marianas Variety reported that the physicians felt uneasy after watching arrogant Kraml on the Idaho News, but that did not change their minds:
All of the doctors whom Variety spoke with asked for anonymity, and expressed their support for the letter and thus the ICS contract. 
CHC staff confirmed that they had watched the Idaho TV story concerning ICS, and had been uncomfortable with some of Louis Kraml’s answers and arrogant attitude.

However, the general consensus was that there are times when a person and/or organization must “hold its nose” and look past concerns for the greater, longer-term good.
That statement speaks volumes about the integrity of the staff. Why do they even believe that signing a contract with a never tested company is for the "greater, longer-tem good"? They have never explained that. Yes, CHC is virtually bankrupt, but it appears that the moral ethics and personal integrity of staff may also be bankrupt. What am I missing here?

Reading the letter was surprising enough, but watching Dr. Jeremy Richards explain this on the May 5, 2012, KSPN News was surreal. This is not a person I would put in front of the cameras to appeal to the community to endorse a contract that is not believed to be on the up and up. Why was he holding his head and making odd gestures? He appeared to be unprofessional and unconvincing.

The letter signed by the CHC Director of Medical Affairs Dr. Jeremy Richards and the Director of Public Health Services, Dr. Dan Lamar contained some startling remarks:
At this point, the medical staff at CHC feel there are no other options. If the ICS contract is rejected by members of the CNMI government, a critical number of providers-23 out of a total of 26 CHC providers-will resign in the next 30 to 60 days. If such a large number of providers resign, CHC will undoubtedly lose Medicaid and Medicare funding, which are key to the future sustainability of this hospital. To regain Medicaid and Medicare funding, CHC would need to be completely renovated and could cost upwards of $90 million-$100 million to reopen.

We are pleading with the government of the CNMI to allow us to continue to provide care to the community of CNMI. The consequences of rejecting this contract between CHC and ICS are imminent and catastrophic.
Many of these physicians have worked at CHC for years, some for decades. They just now figured out that the billing system was a total mess? Really? Or did they start caring when their benefits and salaries were at risk?  How many ever stood up and spoke out on behalf of the nurses and other medical personnel that went without paychecks for months dating back over two years now? What happened to the contract with the other billing company? Why do they believe that no other billing company in the world will be able to provide what this newly formed, never tested ICS can supposedly provide?

The physicians want the public to believe that only ICS can fix the broken billing system and institute transparency. I am sorry, but after reading the comments written by people in Idaho who are familiar with the ICS owners, Louis Kraml and Dan Cochran, I cannot believe these are the two best characters to hook up with. Some words and phrases from comments posted under the Idaho Local News 8 suggest that this could be the worse possible company with which to sign a contract. Here are a few:
  • My advice to the attorney general of Idaho is to investigate this whole organization. What a blatant abuse of the critical access hospital designation. This designation is there to provide health care to small communities that otherwise couldn't get it. Bingham is using this designation for huge profits, and obviously to pad the pockets of the CEO and COO. Of course the board is defending Mr. Kraml, they are probably profiting handsomely as well. Anyone ever look into how many board members have properties leased by Bingham? Might be worth looking into. James, you are either new, naive, or more likely, in the inner upper circle, and have a vested interest in seeing the gravy train continue on its merry way. Bingham employs some wonderful people, and they deserve an honest leader. Got to hand it to Louis though, he is good at what he does. If he wasn't so smooth, he couldn't spend his time in Boise schmoozing the politicians to keep them off of his back this long. Like a Ponzi scheme, it can't go on forever. It will be sad if some genuinely good people go down with the ICS principals, Mr's Kraml and Cochran.
  • Good ol' boy system at its finest.
  • Kraml undercuts private competition just long enough to run them down and buy them out, then puts his prices back through the roof. It's his modus operandi. Weren't county hospitals created to provide services the private sector didn't? What kind of crazy, backward end-around is this? I can't afford BMH and recommend EIRMC or Portnuef every chance I get. 
  • So he is managing a foreign hospital at ABOVE MARKET RATES out of the kindness of his heart??
  • Not only are the rates above market, but all the hospital is getting in return for the management contract is the 3 hours a day he has left over for "moonlighting" ??....
  • I challenge you to find anyone who has EVER worked at BMH that does not anymore, regardless of if they were fired, layed-off, or quit, that has anything good to say about their administration....wont be to many!! The ones who are still there now, are to fearful of losing their jobs to say anything, gotta love that right to work thing!! This community REALLY needs to open there eyes and see what really goes on there!! BMH is in great need of an internal makeover, starting at the top!!!
These comments are a far cry from a good endorsement. In fact, the only endorsement that ICS ever received is one from the cheerleading physicians and administrators of the Commonwealth Health Corp. How can they endorse a company that has no previous record?

The Marianas Variety revealed that Kraml and Cochran already pocketed a large sum from CHC stating that the consultant raked in $2,300 a day:
Cochran first explained that he is “not a consultant, I’m a working hospital administrator” who had good friends on Guam who introduced him and Louis Kraml to CHC because of their hospital revenue management expertise and the relationship developed from there over two months until the founding of ICS in February.

“I’m just going be a 100 percent honest with you about how I would charge for my time or anybody else’s time that comes here,” began Cochran.

He continued by explaining that compensation would include “what I would lose on vacation pay, travel time and some incentive that will make me want to do it [the CHC contract].”

Cochran explained his calculation for project fees: “If I take ten days off and my salary is X and my travel costs are X, then maybe the cost for that 10-15-days would be $20,000.”

That is the amount he requested for this 10-day project consulting trip from April 25 to May 4, his expected departure date.

In addition to the $20,000 base fee would be airfare from Boise to Saipan of $2,000, and his Hyatt government room-rate of $133 a night for an ICS daily total cost of $2,300.
The Variety reported that Cochran got a $10,000 advance before even making the Saipan trip. Cha-ching. Does this smells like the Abramoff deals to anyone else?

Variety reporter Tammy Doty also reported this amazing tidbit:
It was agreed that Cochran would provide in short-order a 12-month strategic plan with the associated costs outlining areas that required systematic adjustment, as well as detailed receipts for items to be included in the start-up costs.

In fact, Cochran said, he and Kraml had already crafted a strategic plan which would be provided to Babauta regardless of whether a contract was signed or not — “My gift to John [Babauta].”
My goodness, cut your losses and ties with this sketchy company, take the "gift" and run.


Anonymous said...

You raise excellent questions for the ICS and the doctors to answer. There'w something suspicious about these doctors insisting on ICS.

Anonymous said...

Is that Dr. Richards in the photos? Is he trying to choke himself?

Anonymous said...

most are fake nurses and doctor in cnmi,,,they dont know what they are doing,,,everything is under the table,,,most r corrupted,,,,government etc.who cares??? USA ???? pls GOD help all CNMI people. amen...

Wendy Doromal said...

10:37 am Yes It's Dr. Richards. He may be nervous about being on camera?

10:00pm There aren't fake nurses in the CNMI. I am certain that they have to be licensed to be hired. There are nurses who have been victims of stolen wages and benefits.

Anonymous said...

Is it true that ICS is merely training existing CHC staff to do the billing? This appears to be just another scam. Bid out the job!

Capt said...

Guam's Hospital is also not in very good shape.
There is a new private hospital that is presently under construction in Guam.
That seems to say a lot in itself.

Anonymous said...

Well NOW what is going to happen? With ICS out because they could not supply the requested info and attempted to "substitute" forms etc.
Just what are the doctors going to do?
What will happen to CHC?
With the rest of the political "hacks" and this Admin. unable to come to any agreement.
Will This Admin. give somebody ( an incompetent friend or relative) a sole sourced contract for the billing?
Did all of ICS people also leave?
How many actual employees were here? (if any)