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U. Of Arkansas Radiology Audit Finds Chaos

February 8, 2013
Written by: , Filed in: Practice Management
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An audit of the radiology department at the University of Arkansas for Medical Sciences (UAMS) in Little Rock uncovered a financial and management mess. A board of trustees committee wants to know how far back it goes.

The audit covered 28 months, from January 2010 through April 2012. According to ArkansasOnline (the online version of the Arkansas Democrat-Gazette), the trustees’ Audit Committee last Friday ordered that investigators take a look at previous years as well. Insurance executive Ben Hyneman of Jonesboro, Arkansas, chairman of the committee, said:

The findings of the report were, quite frankly, pretty shocking. We’re determined to have this thing fully investigated.

You can read the ArkansasOnline story here (it’s behind a pay wall, but you can get a one-day “subscription” for 99 cents). And you can find the audit report itself here. Some highlights—or lowlights:

  • A business that leased space from UAMS to house a PET scanner and a cyclotron failed to make $300,000 in required payments. The business was owned by Rodney Thomason.
  • Another Thomason-owned business failed to make payments it owed to UAMS. Instead, it sent payments directly to UAMS employees, with the cooperation of the department’s business administrator, Jack Evans. UAMS employees didn’t report the payments as outside income on their conflict of interest forms because the checks carried the UAMS name (without permission), and the employees thought the money came from UAMS.
  • Evans retired on May 1, 2012, a week after the audit began. UAMS officials wouldn’t say whether the retirement was voluntary.
  • Philip Kenney, MD, stepped down as radiology department chairman July 1 in an agreement with administrators (although his page on the UAMS Web site still lists him as chairman; actually, Richard Turnage, MD, is interim chairman). Dr. Kenney remains a professor of radiology.
  • Marc Berridge, PhD, a full-time UAMS employee, operates the UAMS cyclotron facility. He also co-owns an outside company, 3D Imaging, with Thomason. That represents a conflict of interest, in violation of UAMS policy. Dr. Berridge told the auditors that he spent 90 percent of his time with 3D Imaging and had no plans to resolve the conflict of interest. UAMS resolved it for him; he will no longer be a UAMS employee after March.
  • The department, which has an annual budget of nearly $20 million, spent $1.1 million more than it received in fiscal year 2012.

There’s more, involving sloppy bookkeeping, lax oversight of leave and vacation time, an unauthorized salary increase, and other manifestations of what could charitably be called a casual management style. The auditors made 29 recommendations, each of which UAMS accepted and carried out. The audit report indicates that some of the problems go back at least to 2005. We’ll keep an eye out for further revelations.

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Related seminar: The Business of Radiology

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