Herald-Leader Editorial

Get new manager for HealthFirst clinic; conflicts risk funding for project

July 26, 2013 

HealthFirst had planned to raze this building at 496 Southland Drive in Lexington and replace it with a clinic.

PHOTO BY PABLO ALCALA | STAFF — Lexington Herald-Leader Buy Photo

There was strong language in the report released yesterday by the state auditor on its investigation into HealthFirst, the nonprofit funded largely by federal grants that is charged with providing health care to those who would otherwise find it hard to obtain.

The report concludes that HealthFirst rigged the criteria toward a favored, pre-selected candidate when it hired a project manager to oversee construction of a new primary care clinic and that the person chosen, Lexington developer Ted Mims, has a serious conflict of interest.

HealthFirst officials, who have been prone to circle the wagons rather than address problems in public, must take these findings and recommendations to heart and change their ways.

To do otherwise is to risk losing the federal funding that's essential to providing health care for those who can't otherwise afford it.

Specifically, Mims' involvement as project manager must end and HealthFirst must restart the search, using a transparent process that clearly sets out both the requirements for the job and the criteria that will be used to evaluate candidates.

The reasons are laid out clearly in the report.

On the selection process: "It appears the selection of a Project Manager was decided before the solicitation process to identify potential candidates for the contracted position was initiated," the report states.

As for Mims' conflict of interest, the report asserts that his 10 percent ownership interest in the property that HealthFirst plans to lease and build on is a huge problem.

That interest makes it "highly improbable that an individual could completely remove any personal consideration when making decisions as Project Manager," the report asserts.

But that's not all. "In addition, the Project Manager is also known to have business dealings with the majority owner of the Southland property in other projects. It is also improbable, if conflicts arise, that an individual could fully disregard his responsibility to his business associate and jeopardize future business opportunities and potential earnings with that person."

The report also raised serious questions about HealthFirst's financial management and projections.

Like many health care providers in Kentucky, HealthFirst has been hit hard by delayed Medicaid reimbursements. However, the agency has also estimated that revenue from patients would far exceed the actual collections, adding to the financial troubles.

This isn't just a "gotcha" report. Indeed, as Auditor Adam Edelen said Thursday in releasing the report, the members of the HealthFirst board are trying to do a good job and provide an essential public service.

The importance of the service — expanding access to health care in our community — and the fact that it involves millions in public dollars demand a commitment to transparency, accountability and clear-eyed professionalism.

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