City Council gathered last Tuesday, July 22, to discuss the Hospital Commission’s 2025 budget, with conversation diverting to personalities at several points.
Finance Director Michael Akins helping to clarify information on the hospital’s balance sheet. Questions that aldermen had included why the bank balance on the balance sheet did not match total cash and cash equivalents, the nature of a $3 million liability, whether the hospital will be creating a revised budget for 2025, and whether to hire a third party to look over the hospital’s financials to verify correctness.
The question of liabilities of $3 million on the balance sheet, as alderman Rachael Moyer said her understanding was, is money that the hospital has received as part of money distributed for the Covid-pandemic. Akins explained that because that money can be requested back if proper documentation of its use is not given, it is listed as a possible liability for the hospital.
Akins said he was told that money was originally requested and given through the management company Alliance, which managed the company for several months in 2020 before being terminated by the commission in September of that year, and Alliance would have the documentation and receipts of that money’s use. If the hospital were required to provide documentation, staff currently would not be able to fulfill that request. He also pointed out, though, that once September passed that money would no longer be considered a liability as the time frame for request back would be past due.
Alderman Terry McClung said that whether or not Alliance was the one to request the money originally, the hospital “Should have been overseeing it one way or the other” and council discussed the possibility of the hospital setting aside money in case it should be recalled.
On the cash balance and bank balances not matching, the hospital had provided a revised balance sheet with adjustments that had been suggested by Forvis, the company currently auditing the hospital’s 2024 financials. Akins explained that the hospitals bank balances and finance information provided to council was not verified by the hospital commission before diving into adjustments suggested by the auditor.
He said that a mistake had been made when the hospital switched to their Oracle accounting software where the Accounts Receivables were being placed into the cash balance and cash equivalents balance. The adjustments now show that cash equivalents more closely matching the bank balance and that because the Accounts Receivables were being placed in the wrong item, it was making it look like the money due to the hospital for its services were trending down dramatically.
Moyer pointed out that the hospital is operating at an average monthly operating cost of $366,266 and that without the subsidy for becoming a Rural Emergency Hospital, the hospital would have closed. She lamented the seeming lack of concern by the hospital commission over expenses, including how expensive contract labor is, as well as the commission spending outside their budget for 2025. She mentioned that national politics means any subsidy is uncertain and that added to her concern for the hospital.
Alderman Susane Gruning agreed with the concern over the commission’s financial position and said that if council wasn’t able to get to the bottom of the issue with what was provided by the hospital previously, then the hospital may not have a qualified person handling financials.
Alderman Steve Holifield did ask Akins directly if he saw any problems with the balance sheet and financials they had provided for the workshop and Akins said that while there were questions about what certain items referred to, he did not see money missing. He said that he’d also asked to see the auditor’s report and suggestions as they came in.
Aldermen moved to discussing whether or not to hire a third-party firm to look at the hospital’s financials. The audit currently in works looks at 2024 but not 2025, and several aldermen’s concerns were mentioned to be with how the 2025 budget was being spent and the need for a revised budget. Moyer said that with how the commission reacted to council’s questions she was not confident in the commission. Council went back and forth with Mayor Butch Berry on what actions to take including the possibility of removing commissioners, and a third party audit for 2025. Berry suggested that council and the commission have a joint workshop when Forvis gives their audit report in full around September.
Liberalism is a mental disorder.
I have been watching YouTube videos of the Eureka Springs City Council and hospital commission meeting for the past several months and it truly amazes me the lack of testicular fortitude of the city council and the mayor when it comes to dealing effectively with the hospital commission. When I worked there, ESH was placed under the City of Eureka Springs, making all employees part of the city government. We received retirement benefits and were on the city insurance policy. The hospital commission still directed the hospital, but from a back seat position. Now it seems the city is being held hostage by the hospital commission, just daring the city council to do something to establish control. Something the council never had in the first place. So, when a council member(s) suggests having the CFO of ESH, Cynthia Asbury, appear at a meeting of some sort, to explain in detail and to answer questions about the ongoing financial issues and the creative bookkeeping, mentioned in the above Times Echo report. Yet again, tough talk from some of the council members was stopped by the mayor and his handwringing. So, when is the council going to grow a pair and tell one of its departments, the Eureka Springs Hospital, to make itself available for any and all questions they might have? When will Asbury and Edmondson be held accountable for the hostile work environment they were responsible for? When will former employees of ESH, essentially employees of Eureka Springs, receive satisfaction of being taken seriously by the city? Instead, they are increasingly aware the city doesn’t have their back and never did. During joint meetings between the hospital commission and the city council, it is painfully obvious, the commission chair says a lot of words with little substance. I believe it has been described as a “word salad.” Why is that? As I said before, the commission knows the mayor will not step up and do his job and get rid of the commission en masse, because he says no one in the community is interested. ESH and its leaders will continue to flaunt its behavior, give a middle finger salute and hold the city council and the city hostage. Why? Because no one will stop them.
this town and the hospital are pathetic.
The city can request a third party to review the financials of ESH, but can’t remove hospital commission members? Another workshop to discuss finding out another workshop might be necessary. Man, talk about stalling.