North Broward Hospital District Commissioner Joseph Cobo may have exploited his public position in seeking favorable publicity, a private jet trip, and more generous terms for clients of his private consulting firm in their business dealings with the health care system, according to the investigative report released last week.
Despite these allegations, as well as those detailed in three previous blog posts -- here, here and here -- it should be noted that the Cobo investigation marks progress on behalf of the Board of Commissioners and Broward Health executive management.
An ironic occasion for praise, but still it's an important part of the big picture. Five years ago, this was a public health system rife with kickbacks and insider deals, one that seemed to dread closer inspection. Put it this way: a culture that previously may have reacted to allegations of impropriety by covering it up or by short-arming an investigation is now a culture that takes allegations seriously, as Chairman Mike Fernandez stressed in an interview with Juice on Tuesday.
That starts with its retaining a former federal prosecutor in Martin Goldberg who made an inquiry that was very aggressive, judging by the report he gave to commissioners last week. (Goldberg declined a request for an interview and seems unlikely to comment on his investigation while board action is pending.)
And the flip side of allegations that Cobo sought to improve his clients' business terms with the district is that in most cases he seems to have been compelled to do so based on efforts by existing Broward Health corporate management to cut costs, making the public health system a more efficient spender of its tax dollars. That's encouraging.
Cobo himself deserves credit for his cooperation with the investigation -- Goldberg's report would have made note of efforts by Cobo to obstruct it. Further, Cobo has grounds for questioning the conduct of his original accuser. Former Acting General Counsel Troy Kishbaugh did not appear inclined to ward off the commissioner from his allegedly illegal path. Yet Kishbaugh apparently thought Cobo's conduct was troubling enough to take careful note of it and produce the sprawling January 29 memo that prompted the investigation. In short, Kishbaugh looks like he was giving Cobo enough rope to hang himself. For more on Kishbaugh's role, see this blog post by Sun-Sentinel political columnist Anthony Man.
After the jump, a closer look at allegations involving a private jet and a very suspicious puff piece about Cobo published in Las Olas Lifestyle magazine.
About that puff piece: Broward Health had been an advertiser with Las Olas Lifestyle since 2005 but by late 2007 the district was cutting its advertisement budget and that contract was one casualty.
This came as a shock, it seems, to the magazine's president / publisher, Jim Norton, who allegedly contacted Cobo in hopes the commissioner could win back the contract. Last June and July, Norton made a flurry of phone calls to district executives and on July 10, Broward Health Manager of Corporate Marketing Selima Khan wrote to others in her department that Norton "is one of the vendors who has referenced commissioner relationships -- he's VERY persistent."
Cobo allegedly contacted Sara Howley, vice president of corporate communications and marketing, asking her to meet with Norton. According to the investigation, "Howley advised Cobo that advertising space in Lifestyle magazine was very expensive... Nevertheless, Cobo again asked Howley to speak with Norton."
The investigation alleges that "Howley advised Norton that his involement of a Broward Health Commissioner in the magazine's efforts to obtain advertising was not the way Broward Health usually handled its advertising placement decisions."
Though Broward Health agreed to pay for a single ad, at a price of $1,095, that wasn't nearly enough to placate Norton, judging by Goldberg's report. After Norton continued to push the issue, Howley grudgingly contacted the system's regional facilities to tell them of Norton's sales pitch, and Imperial Point Medical Center responded, ultimately running ads in the December and January issues. Howley told Goldberg that "but for Cobo's involvement, Broward Health would not have contacted the regional health facilities" on the magazine's behalf.
Then, in what looks conspicuously like a quid pro quo, Cobo began courting Lifestyle in hopes it would publish a flattering article on him, according to the investigation. In October the commissioner is alleged to have written at least two e-mails that boasted of community honors and professional anniversaries. In one of those, Cobo also allegedly noted that the magazine had scored ads from Broward Health. On cue, perhaps, Norton responded to that message with congratulations for Cobo's most recent honor and by telling him that a Lifestyle editor would be in touch about a future article. In its December issue, the magazine made Cobo its "Icon."
Goldberg concluded that Cobo may have violated the corporate charter by contacting the marketing department on Lifestyle's behalf. If that contact was Cobo's effort to gain "Icon" status, Goldberg found that "this is highly problematic from a legal perspective."
Three more findings of potential ethics violations are relatively minor, compared to the others covered in previous Juice posts.
Last September, after a Broward Health review found that the district was over-paying for lithotripsy services, management divested from its 15 percent ownership stake in the Urological Center and then told the center it would be reducing its rate of payment by a significant percentage. Two members of the center's board were also clients of Cobo's private firm, Florida Medical Management Consultants. One of them, Dr. Ronald Fauer, allegedly called in Cobo. The commissioner then contacted the district's president / CEO Frank Nask and its chief operating officer, Spencer Levine. Only it seems he did so while wearing his consultant's hat, which Levine mistook for Cobo's commissioner hat.
"Levine was surprised that Cobo was not pleased with the significant savings Broward Health would achieve by reducing the rate," says Goldberg in his report. After Levine reminded Cobo that district contracts needed to be in compliance with fair market value, Cobo allegedly responded with irritation, asking Levine "why he had to 'make everything a compliance issue.'"
But though Nask and Levine met with Fauer based on Cobo's request, it's not evident the meeting produced financial advantages for the center at the hospital district's expense, according to the investigation. Cobo's alleged involvement is problematic only because of the "non-interference provision" of the corporate charter, whereby commissioners are supposed to act collectively through action in their public meetings.
Based on that same rule, Goldberg's investigation found that Cobo may have acted improperly when in November 2008 he allegedly called Nask to request a private plane to Tallahassee for Broward Days 2009. When Nask turned him down, Cobo allegedly called another Broward Health executive with the same request, only to be rejected again.
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Goldberg found that Cobo bent this rule in yet another instance through his association with an insurance broker, James McKinley, who Cobo knew from their mutual involment in the Broward County Housing Authority. In that case, Cobo allegedly inquired about the district's decision to change its disability insurance carrier, a decision that had affected McKinley, who was that insurance carrier's broker. Having been informed by a human resources executive that the move would save the district $2.4 million, Cobo is said to have agreed with the decision. Still, he allegedly convinced Broward Health executives to meet with McKinley about the prospect of future contracts, a move that Goldberg deemed as a potential violation of ethics law.
Whatever comes of the Cobo case, it's a signal to all the players in Broward's massive public health system -- among the five biggest in the nation -- that corner-cutting is now a risky and perhaps foolhardy endeavor. For taxpayers who fund the system and depend on it for their health care, it's cause for relief, if not exactly celebration.
This morning, the North Broward Hospital District commissioners announced an emergency meeting this afternoon. Fernandez has previously stated that the district's new general counsel, Marc Goldstone, was reviewing the investigative report and preparing to advise them on a course of action. He's expected to do so at this afternoon's meeting.
UPDATE: Umm, about that general counsel's position....