South Central Kansas Medical Center in Ark City is dropping its longtime collections attorney and that decision created some backlash that led to a special meeting Monday afternoon requested by hospital CEO Jeff Bowman.
Bowman told the SCKMC Board of Trustees the hospital’s collections attorney, the Ark City-based Law Office of Tamara Niles, told him via email Sunday night that his decision to stop using Niles’s services and switch to a different firm would be “delayed” at the discretion of the board.
None of the trustees said they remembered stating such to Niles and told Bowman he has the authority to make such a decision. The topic was at the center of nearly an hour of discussion.
All of the trustees are city commissioners and Niles is the city attorney. Financial struggles led to a city takeover of the hospital board in May 2018.
Bowman, who was hired by the board to a two-year contract in November, said he had terminated collection services with Niles May 20 via an email and instead agreed to a contract with the hospital’s existing attorneys Soule & Giles, L.L.P., who are also based in Ark City. Bowman said Soule & Giles will take a 25 percent cut of pre-trial collections judgments rather than the 30 percent rate offered by Niles.
Bowman said Niles has not complied with records requests to aid in the transition of the new firm and asked him Sunday night in an email, “Are you aware that the trustees are delaying this matter?”
Trustee and Ark City Mayor Jay Warren asked Bowman why Niles would say that.
“I have no idea, that’s why I called this meeting,” Bowman replied. “She’s impeding our business being able to transfer over efficiently and she’s also asking for monetary reimbursement, which is nothing in her contract — let me back up, it wasn’t in her contract that was active through 2015. She’s had no contract for three and a half years.”
According to Bowman, the official start date with Soule & Giles for collections services will be June 25. Both Chad Giles and Clayton Soule were present at the meeting Monday. Bowman added that Niles’ previous contract had no auto-renew built into it.
Both Board Chairman Dan Jurkovich and trustee Karen Welch said they understood Niles’ frustration with no longer being able to provide those services to the hospital amid the abrupt notice. They also urged Bowman to calm the waters between them.
But Bowman didn’t feel that was possible, stating that after she became “aggressive” after she was informed of his decision and demanded copies of his contract, meeting minutes and other documents via the Kansas Open Records Act.
“This is a woman I’ve had very little contact with for nine months,” he said. “In my opinion this is an intimidation tactic.”
Niles’ office declined to comment on the situation Monday afternoon.
“Ms. Niles is a member of the community… her family does a lot of stuff,” Jurkovich said during the meeting. “So we try to also put ourselves in her shoes. That doesn’t mean we change what we’re doing, but if you imagine if somebody was taking business away from you, so to speak, you would try to hope to get a chance to win it back or not lose it. Although probably asking for open records might not be the best way to create a friendly bridge to win business back, but I can appreciate her desire and ability to do that.”
Trustee Duane Oestmann also said he understood the reaction of Niles’ office.
“To me that’s where it probably fell down, is that she was just told, ‘You are no longer going to be our collections agency, ” he said. “That would bother me, too.”
Ultimately, Bowman asked for affirmation he had the authority to make such decisions without a board vote, citing a previous meeting and executive session where trustees stated that was the case.
“It was my decision to make, is that correct?” Bowman asked.
The board told him it was.
“The CEO handles that,” Warren said.
Welch said it would’ve been better for face-to-face communication on the matter rather than through emails.
“I understand what you’re saying, but it’s his call — it’s Jeff’s call,” Vice Chair Kanyon Gingher said. “We’ve given him that authority all along.”
At one point in the meeting Bowman stressed to the board that although the hospital was on a “pathway to being profitable,” he was looking to save money any way possible and cited the failure of Medicaid expansion to pass the state legislature earlier this year as one of many hurdles in the road of that goal.
“There’s a lot of factors that came into this,” he said. “And I’m looking at every avenue and every area that I can save some money, and this is one that made sense.”
