CCMSD severs ties with management company

Claiming that there is no longer rapport between Crook County Medical Services District (CCMSD) and Health Management Services (HMS), the Board of Trustees announced last week that it will sever the relationship with its management company.

At a special meeting last week, the board retired into executive session to discuss the situation.

“The current contract is expiring at the end of September,” said board chairman Mark Erickson.

“With that, and since we’ve now received notice of [CEO Nathan Hough’s] departure, the board is going to retire into executive session to talk with our legal counsel on those matters.”

Around 45 minutes later, the board emerged to announce their findings. Erickson stated it was his belief, “that we should explore how we can exit that contract prior to the exit date” and have the board’s lawyers, Hirst Applegate, reach out to HMS to explore those options.

The “worst case” scenario, he said, is that the relationship will continue for another 120 days per the early severance terms of the contract.

Trustee Sandy Neiman shared her thoughts that, while HMS has brought in significant revenue to the district – reported in February by Karl Rude, president of HMS, to be $3.2 million per year – the district is “footing the bill for that revenue”.

The board already has names of applicants for the CEO position, she continued, and will have more coming in.

She added to her justifications the situation regarding federal COVID-19 relief funds. Those funds will probably “qualify as operating money”, she said, which means HMS would also have received some of it.

Trustee Connie Lindmier added her agreement, stating that she would like the relationship to end sooner than the 120 days if it can be negotiated. After the issues the board went through when the relationship with Regional Health was severed, she said she does not want to see the same problems at the end of the contract.

Hough and the team have done a good job, Lindmier said.

“We had good rapport at the beginning but things have changed and it’s time to move on,” she continued.

Because the meeting was conducted online, most participants were placed on mute for technical reasons. In the written chat window, Rude asked: “Will the board be bringing their account up to current?”

This question was not addressed.

Neiman made a motion to provide notice to HMS that the contract will be ended after 120 days or sooner if possible, and to direct Hirst Applegate to work with HMS’s lawyer to negotiate an earlier release. The motion passed unanimously.

Though the board did pledge to discuss management contract issues in public after the community expressed concern over the situation earlier this year, Erickson signaled a need for closed door discussions on this matter. He advised that there will be a couple of special working meetings between now and the April 29 regular meeting that will not be open to the public.

“We’re going to start the search ourselves and there are conversations that need to take place with various individuals that need to be held in confidence at this time,” he said.