VIDN_HospitalCorruption

Copyright © 2008 Daily News Publishing Co. www.virginislandsdailynews.com ONE DOLLAR

The Virgin Islands

DAILY NEWSA Pulitzer Prize-winning newspaper

77th year, No. 21202 MONDAY, JULY 28, 2008

Salaries first,patients later

SPECIAL INVESTIGATIVE REPORT

16-PAGE SECTION INSIDE TODAY

Charlotte Kimelman Cancer Instituteat Schneider Regional Medical Center

By JOY BLACKBURN and TIM FIELDSDaily News Staff

While a backlogof unpaid billsinterrupted cancertreatments, a hospitalexecutive enjoyeda deluxe pay andperks package

Former CEO with a badconduct discharge fromthe Navy was given thebiggest pay package ofany V.I. official ever

A Life RememberedOne cancer patientfound a way to closethe book on despair

One cancer patient found a way to close the book on despair

Copyright © 2008 Daily News Publishing Co. • A Times-Shamrock Company

Salaries first,patients later


The Virgin Islands Daily News

Charlotte Kimelman Cancer Institute at Schneider Regional Medical Center


S T. THOMAS — At the same time thatSchneider Regional Medical Center waspaying Chief Executive Officer Rodney

Miller Sr. a three-quarter million-dollar salarywith lavish perks and benefits, the hospital wasfailing to pay its bills for Charlotte KimelmanCancer Institute’s medicines and equipment.

Cancer patients were the ones who sufferedand, in some cases, died sooner than they mighthave, the former Kimelman administrator said.

Already racked with the anxiety and pain ofcancer, some of the patients who went toKimelman Institute in 2006 and 2007 forchemotherapy and radiation treatment found theycould not rely on getting their treatment on time.Drug companies cut off the supplies because the

hospital fell far behind on payments. The manu-facturer of the radiation machine would not serv-ice it because the hospital stopped making pay-ments for purchase, installation and servicing.

Miller, who was a convicted criminal with a

bad conduct discharge from the Navy, tried to usethreats to keep the complaints quiet.

Miller instructed Kimelman InstituteAdministrator Renee Adams to tell a terminallyill patient that if she went to the news media, shecould not come back for treatment until she paidher bill in full — which she could not do on shortnotice.

The administrator did not comply with Miller’sorder and instead raised complaints of her ownabout the patients’ care.

Miller later fired her — but offered her $80,000in hush money. She could get that money only ifshe promised not to go to the media.

She refused to take the money.See PATIENTS, next page

While a backlog of unpaid bills interrupted cancer treatments,hospital executive enjoyed a deluxe pay and perks package

Rodney Miller Sr. Amos Carty Jr.

Monday, July 28, 2008, The Daily News2 Special Investigative Report SALARIES FIRST, PATIENTS LATER

Pomp and ceremonyWith much fanfare and mutual congratulations,

the hospital board and executives presided overthe ceremonial ribbon-cutting to dedicate the $18million Charlotte Kimelman Cancer Institute onJan. 17, 2006. One after another, governmentofficials spoke of the cancer institute as a dreamcome true and a lifeline to Virgin Islanders withcancer who previously had to leave the island andtravel far from home and family to obtain treat-ment.

Schneider Hospital already provided limitedoutpatient chemotherapy, but the new cancerinstitute was supposed to consolidate treatmentand support services in one gleaming new facili-ty featuring top-of-the-line equipment that wouldprovide, for the first time at Schneider, radiationtherapy to cancer patients.

The cancer institute is part of SchneiderRegional Medical Center, which also includesSchneider Hospital and the Myrah Keating SmithCommunity Health Center on St. John.

Even though the Kimelman Cancer Institutewas dedicated in January 2006, it was nearly four

months before construction ended and the doorsopened to patients.

In late May 2006, the hospital proudlyannounced in a widely broadcast press releasethat the Kimelman Institute had treated its firstpatients with radiation therapy.

On July 26, 2006, the hospital held another cer-emony — and another ribbon-cutting — to offi-cially inaugerate operations at the KimelmanInstitute and announce that chemotherapy servic-es had fully transitioned from the hospital to theinstitute that month.

Perpetual problemsOnce the hoopla calmed down, the hospital

management made the cancer institute’s needs alow priority.

Renee Adams, the former administrative direc-tor at Kimelman, told The Daily News that cancerpatients often suffered because the hospital didnot pay its bills on time.

She said she believes some patients died soon-er than they should have because of the problems.

Cancer — An abnormalgrowth of cells, which tendto quickly multiply in anuncontrolled way, and insome cases, spread. Cancercan affect any tissue of thebody. Benign tumors are notcancer; malignant tumorsare.

• • •

Oncology — A branch ofmedicine in which doctorstreat cancer.

• • •

Medical oncology — Thetreatment of cancer withmedicine, includingchemotherapy.

• • •

Radiation oncology — Thetreatment of cancer usingradiation therapy.

• • •

Chemotherapy —Chemotherapy is a cancertreatment that uses drugs —chemicals — to kill cancercells. Cancer cells tend togrow and divide faster thanhealthy cells. Chemotherapyworks by slowing orstopping that growth. Theidea behind systemicchemotherapy is that cancercells will take up more of thechemicals faster than normalcells and thus die faster.Healthy cells also absorb thedrug, causing side effects.

• • •

Radiation therapy — Acancer treatment that directsradiation to a specific spot tokill cancer cells or shrink atumor, by stopping themfrom growing and dividing. Itaffects cells only in thetreated area. Externalradiation comes from amachine. Internal radiationinvolves implanting a smallcontainer of radioactivematerial into or near thetumor.

• • •

Dosimetrist — A medicalprofessional who works inradiation oncology, using aradiation oncologist’s ordersto generate radiation dosedistributions and calculationsto come up with a treatmentplan that will best attack atumor.

Source: www.MedicineNet.com

Terms

See PATIENTS, page 4

PATIENTSCONTINUED FROM THE FRONT PAGE

Daily News File Photo

Schneider Regional Medical Center CEO Rodney Miller Sr., left, leads the groundbreaking for the Charlotte Kimelman Cancer Institute.

Charlotte Kimelman Cancer InstituteThe institute is:• An $18 million treatment center for outpatient radiation and chemotherapy.• The first and only facility in the Virgin Islands that offers radiation therapy.• Part of Schneider Regional Medical Center.• Attached to the Schneider Hospital building on St. Thomas.• Open to patients since May 2006.• Approximately 24,000 square feet.• Named for Charlotte Kimelman, who with her husband, Henry Kimelman, donated more

that $1 million to the project.

“I sincerely believe they died as a resultof not having the medications that could have extended

their life and given them some kind of quality of life.I really believe that had they gotten continuous treatment,

they would have lived longer.”— Renee Adams, former Kimelman Cancer Institute administrative director

SALARIES FIRST, PATIENTS LATERThe Daily News, Monday, July 28, 2008 Special Investigative Report 3

Schneider Regional board gave CEOa three-quarter-million-dollar pay dealMiller had free hand to OK hospital executives’ bonuses, extra payments


S T. THOMAS — On the same day in May2007 that staff members at CharlotteKimelman Cancer Institute confronted Chief

Executive Officer Rodney Miller Sr. about how thehospital’s failure to pay its bills was underminingpatient care, the Schneider Hospital board of directorshanded Miller the biggest compensation packageever awarded to a public official in the territory.

The contract, signed by hospital board chairJune Adams, gave Miller $536,000 in salary andbonuses annually, $222,700 in tax-deferred com-pensation and a lavish package of perks — whichincluded guaranteed business class travel for him-self plus $10,000 a year in travel money for hiswife.

Amos Carty Jr. — who was Miller’s subordinateat the time and simultaneously was general counselto the hospital and to its governing board —approved the contract for legal sufficiency.

Board attorney Steve Russell said there was noconflict of interest in Carty’s filling those roles.Russell said Miller negotiated his own contract withthe board’s Compensation Committee.

Miller’s compensation included a $310,000 basesalary, up to $93,000 in performance bonuses, and animmediate $77,500 signing bonus, meaning he gotthat money just for putting pen to paper.

Miller and June Adams signed the contract onMay 14, 2007, which also was the day he met in theCharlotte Kimelman Cancer Institute’s conferenceroom with a group of cancer center staff. Formercancer institute administrative director Renee Adamssaid they begged Miller to pay the hospital’s overduebills and end the chronic shortage of drugs for thepatients, end the lack of maintenance for high-techmedical equipment, and end the shortage of much-needed supplies.

The cost of chemotherapy drugs for one monthtypically ranged from $50,000 to $100,000, Adamssaid.

The $77,500 signing bonus that Miller securedthat day could have paid for nearly all cancerpatients’ drugs for an entire month.

Renee Adams said Miller promised the staff at themeeting that the problems would never recur.

But they did, she said. She called the situation“unconscionable.”

Big moneyMiller’s $536,000 salary and bonus package alone

made him the highest paid public official in the terri-tory’s history — dwarfing the $85,000 paid annual-ly to each member of the V.I. Legislature and the$150,000 paid to the territory’s head of state: Gov.John deJongh Jr.

Miller’s housing and cost of living money alonewas higher than the income levels of more than 75percent of all households territorywide, according tothe 2000 U.S. Census.

Miller received considerably more than that.Miller’s compensation package also provided an

assortment of benefits and tax-deferred compensa-tion:

• $125,000 annual contributions to an irrevocableRabbi Trust, which is a financial arrangement thatallows an employee to get additional payments putinto a tax-deferred account.

• Contributions of $41,660 to the Rabbi Trustaccount in December 2007 and contributions of 8.4percent of Miller’s base salary — an amount thatwould equal $26,040 in 2007 — as long as he wasemployed by the hospital.

SchneiderRegional Medical

Center Honorary CEO EmeritusRodney Miller Sr., president

and CEO (May 2002 toNovember 2007)

Senior managers• Amos Carty Jr., CEO • Peter Najawicz, chief

financial officer• Angela Rennalls-Atkinson,

chief operating officer• Blondell Williams, vice

president of nursing andpatient care services

• Elizabeth Harris, vicepresident for quality andperformance improvement

Communications• Sam Topp, public

information officer

Governing Boardin 2008

• June Adams, chairman• Mulchand Alwani • Beverly Chongasing • Dr. Murli Daswani• Francis Jackson Jr.• Natalie Thomas• Aldria Harley-Wade • Doradean Williams

Governing Boardin 2002

• Beverly Chongasing,chairman

• June Adams• Horace Brooks• Yvonne Francis• Francis Jackson Jr.• Ray Joseph• Dr. Leighmin Lu• Natalie Thomas• Sam Topp

Who’s Who


Rodney Miller Sr. speaks at the Kimelman Cancer Center opening ceremony.

Before he was Schneider Hospital CEO,Miller was a convict in the Navy brig

In 1995 he pleaded guilty to stealing credit cards,faking documents and deceiving others for coverup


T wo years before Schneider Hospital’s gov-erning board handed Rodney E. Miller Sr.the helm of St. Thomas’ only hospital, the

U.S. Navy handed him a bad-conduct discharge — afact Miller lied about on his V.I. government jobapplication.

Miller stole a fellow serviceman’s credit cards,went on a shopping spree with them and then, whencharged with the crimes, he concocted an elaboratescheme to cover his tracks by faking an alibi, falsify-ing documents, duping other servicemen into help-ing him with the coverup and, in the end, lying to hisattorney.

Miller committed the crimes in 1994 and 1995when he was assigned to the Naval Dental Center atthe Marine Corps Recruit Depot in Parris Island,S.C. The Navy provides health care services for theMarine Corps, and at the time he stole the creditcards and falsified documents, Miller was a dentaltechnician 3rd class. He had been in the Navy fouryears.

Miller’s court-martial records are open publicdocuments, and The Daily News requested andobtained them from the U.S. Navy Judge AdvocateGeneral’s Corps, which is the Navy’s legal arm.

Miller did not respond to numerous telephonemessages from The Daily News seeking his com-ment for this story. He also did not respond towritten requests for an interview that The DailyNews sent to his home and office via FedEx andthat were received and signed for at his office andhome in Florida, where he moved in 2007 after

leaving St. Thomas.Members of the Schneider Regional Medical

Center governing board who spoke to The DailyNews for this story said that they used an executivesearch firm to find their new chief executive officerin 2002.

Francis Jackson Jr., whom Gov. Charles Turnbullappointed to the Schneider board about the sametime Miller was hired, said he has heard rumors of abad conduct discharge but was under the impressionthat Miller received an honorable discharge.

The bad conduct discharge “would have been asignificant factor that we would have taken into con-sideration with respect as to whether or not to hirehim in such an important position,” Jackson said. “Ithink it would have been a critical factor.”

Board member Natalie Thomas said she wasunaware of Miller’s court-martial and bad-conductdischarge. She said that she is sure it would havemattered to the board if the members had knownabout it.

Pastor Ray Joseph, who no longer is a board mem-ber, said Miller’s military record was an important

See MILLER CONTRACTS, page 5 See MILLER CONVICTION, page 9

“We still believe that a badconduct discharge is notinappropriately severe.”

— U.S. Navy-Marine CorpsCourt of Criminal Appeals decision

in Rodney Miller’s case, November 1998


“It’s important that people understand what wasgoing on — and why — and mostly how thepatients, how the community, actually suffered,”Adams said. “And it’s important that this get out.”

Occasionally, treatment delayswere caused by logistical prob-lems or by the initial difficulty inobtaining a brand new drug.

But beyond that, the cancerinstitute had perpetual problemsgetting all the chemotherapy andsupportive drugs that the patientsneeded — and Renee Adamsblamed the hospital manage-ment. They would not pay thepharmaceutical suppliers on timeand the drug companies would stop shipments untilthey got a check, she said.

When patients’ cancer drugs did not arrive, thepatients were sent back home or were called ahead oftime and told not to come in, Adams said.

Avon Crossley, whose teenage daughter, Kenisha,was treated at Kimelman in 2006, recalled that whenthey got to Kimelman one day, the medication wasnot there and they had to leave without Kenisha get-ting her treatment. The second time, she said, theywere notified by phone that Kenisha could not betreated that day because the cancer institute did haveher medication.

Kenisha was on an abbreviated chemotherapyprotocol that allowed some leeway, so the delays didnot put Kenisha into a crisis, Crossley said.

They did, however, put additional stress on thefamily. Kenisha had terminal cancer, and the treat-ments were designed to give her a good quality oflife for as long as possible — so her mother workedout a backup plan to get the drugs from Kmart ifKimelman did not get them when Kenisha neededthem. Crossley said she never had to put the plan intoaction, but she needed the peace of mind that havinga backup gave her.

Adams said that when things were at their worst,some chemotherapy patients would have to wait fora long as two weeks to get their chemotherapy.

“We’re scrambling around looking for the drug,”she said, describing the staff’s reaction when thedrugs did not arrive. They would even borrowchemotherapy drugs from a local physician, she said.

Irregular radiationPatients who were getting radiation therapy also

suffered, Adams said.Although the hospital bought a state-of-the art

radiation therapy machine, plus the service agree-ment to ensure its flawless operation, the hospital didnot keep up regular payments. When the paymentswere too far overdue, the manufacturer, California-based Varian Medical Systems, would suspend serv-ice.

In August 2006, just three months after the cancerinstitute began treating patients, the hospital owedVarian more than $659,000 — and the bill was 90days past due, Adams said.

In September 2006, the machine needed service sourgently that Adams had to rush a partial payment of$234,416 to Varian via overnight delivery.

Varian refused to provide service based on thehospital’s promise that the check was in the mail,Adams said. Varian demanded that she photocopythe check and fax it to them to prove the hospital hadactually produced the check.

Adams estimated that the machine, which is a lin-ear accelerator, went down about 10 times while shewas director — and the downtimes lasted from oneday to a week or longer.

Survival at stakeThe Daily News interviewed two cancer experts

elsewhere about how delayed, irregular radiation orchemotherapy might affect a patient. Both said thatthere might be therapeutic reasons for a delay — forexample if a patient develops a serious infection —but they did not know what the effect would be iftreatments did not follow strict dosage and timing, aswas the case at Kimelman.

They said that the reason they don’t know is thatthere are no studies gauging the effects of random,non-therapeutic midstream delays in a prescribedcourse of cancer therapy.

No one would participate in such a study becauseit would be unethical and inhumane, they said.

Chemotherapy is a cancer treatment that usesdrugs — chemicals — to kill cancer cells.

Cancer cells tend to grow and divide faster thanhealthy cells. Chemotherapy works by slowing orstopping that growth.

The idea behind systemic chemotherapy is thatcancer cells will take up more of the chemicals fasterthan normal cells, thus they will die faster.

Dr. Stan Gerson, the director of the Ireland CancerCenter of University Hospital’s Case Medical Centerin Cleveland, Ohio, told The Daily News that signif-icant, random delays during a course of cancer treat-ment could allow the cancer cells to mutate andbecome resistant to the treatment — because thedelay gives the cancer cells a chance to recover andregrow.

Dr. Julie Gralow, director of breast medical oncol-ogy at the University of Washington and the FredHutchinson Cancer Research Center in Seattle,Wash., said that a well-known trial on a chemother-apy protocol for breast cancer spotlighted the impor-tance of getting dosages in on time and close togeth-er.

The study, published in the Journal of ClinicalOncology in April 2003, found that giving the dosesevery two weeks instead of every three weeksreduced recurrences and deaths from breast cancerby about a third, she said.

“Once you’ve started, getting the chemo in ontime and close together really impacts your out-come,” Gralow said.

“It impacts your survival.”

Gralow said that chemotherapy, given accordingto a strict protocol, hits cancer cells repeatedly at theoptimal time.

“One dose of chemo is not enough to kill a tumorcell, but it gets stunned. It’s not growing, it’s notdividing, it’s kind of stunned, it’s trying to repairitself.

“If you come in with chemo again on time you cankill it while it’s in that stunned state,” she said.

“But if you give it a couple of extra weeks, it hasmuch more potential to repair itself and start grow-ing again.

“So you’ve lost the bang, bang, bang, hit it hardmultiple times in a row effect if you’ve given it moretime to recover.”

Radiation treatment also requires a regular rou-tine.

The therapy works by directing radiation to a spe-cific spot to kill cancer cells or shrink a tumor.

Gralow said that external radiation typically isgiven five days a week, with weekends and holidaysoff.

However, she said, a significant delay — a weekor more in the midst of treatment because a machineis not working — would be “sub-optimal.”

The Kimelman Institute’s radiation machine wentdown off and on for short periods — but it also shutdown twice for significant amounts of time.

The first was for nine days, March 12 to March 21,2007, because an electric transformer malfunctionedand the hospital had to order a new one. Eightpatients were receiving radiation therapy at that time.

Dr. Shirnett Williamson, the radiation oncologistat Kimelman, said she referred one patient to PuertoRico. For the rest, she sought to make up for the losttime by increasing daily dosages or doubling up ontreatments.

The second time the machine shut down for a longperiod was in October 2007. It was down for twoweeks because the machine’s chillers had not beenproperly maintained.

Chief Executive Officer Amos Carty Jr. told theboard that the hospital’s facilities staff did not knowhow sensitive the chillers for the linear acceleratorwere and they had maintained them like otherchillers used in the hospital.

By the time they learned that the linear accelerator

1980s1980s — Henry and

Charlotte Kimelman donate$250,000 to Partners forHealth for a cancertreatment center. Themoney is invested.

1999 May 14 — Gov. Charles

Turnbull signs into law a billthat makes the territory’shospitals semi-autonomous.The law allows thehospitals to collect andmanage their own revenuebut still receive governmentsupport.

2001July 13 — Schneider Hospital

CEO Eugene Woodsresigns after three years,saying that he had a bettersalary offer to head up amajor teaching hospital inthe U.S. mainland.

2002April 2 — The Schneider

Hospital governing boardselects Rodney Miller Sr.,29, to be chief executiveofficer at the hospital.

• • •

May 13 — Miller assumesthe CEO position atSchneider Hospital.

• • •

Sept. 3 — Schneider Hospitalhires an Atlanta firm,Oncology Solutions, to helpdevelop the cancer center.

• • •

Nov. 27 — Amos Carty Jr.,who is Schneider Hospital’sgeneral counsel, is namedchief operating officer.

• • •

Dec. 4 — Schneider Hospitalofficials announce theformation of a team to helpdevelop the cancertreatment facility. The teamincludes well-knownoncologist Dr. BertPetersen, a V.I. native; thefirm Cancer Carepoint torecruit staff; the firmOncology Solutions toconsult on organizationalstructure; and StanleyBeaman and Sears,architects, to design thecenter.

• • •

Timeline

See TIMELINE, page 5 See PATIENTS, page 6

PATIENTSCONTINUED FROM PAGE 2


Although the hospital bought a state-of-the art radiation therapy machine, plus the service agreementto ensure its flawless operation, the hospital did not keep up regular payments.

“Unfortunately they cannot treat their patients again todaydue to the shortage of medication from the pharmacy.”

— Aug. 28, 2007, memo to cancer institute administrative director Renee Adams from her executive assistant

ReneeAdams

Dec. 3 — Schneider Hospitalseeks a new chief financialofficer to replace the vicepresident of financialservices, Eugene Welsh,who resigned Nov. 22sayng he felt it was “timeto move on.”

2003May — Angela Rennalls-

Atkinson is named vicepresident and chief nursingofficer for SchneiderHospital and Myrah KeatingSmith Community HealthCenter.

• • •

Sept. 30 — Ground is brokenfor the Charlotte KimelmanCancer Institute.

• • •

Dec. 2 — The JointCommission onaccreditation of healthcareorganizations begins asurvey of SchneiderHospital for accreditation.The hospital has neverbefore been accredited.

• • •

Dec. 5 — Miller announcesthat Schneider Hospitaland Myrah Keating SmithCommunity Health Centerwill receive accreditation.

2004April 19 — Peter Najawicz,

37, becomes SchneiderHospital chief financialofficer.

2005April — Dr. Shirnett

Williamson is hired asradiation oncologist for theKimelman Institute.

• • •

April 11 — Renee Adams isnamed administrativedirector for the KimelmanInstitute.

• • •

May 9 — Hospital officialshold a press conference toannounce that SchneiderHospital, Myrah KeatingSmith Community HealthCenter on St. John andCharlotte KimelmanCancer Institutecollectively are now TheSchneider RegionalMedical Center.

• • •

Timeline

See TIMELINE, page 6


• A $30,000 contribution to a 403(b)(7) individ-ual retirement account.

• A $2 million individually owned 30-yearGuaranteed Renewal Level Term Life Insurance,with premiums fully paid up.

• $400,000 group term life insurance• Contributions to the Government Employee

Retirement System pension plan.• $10,000 travel allowance for Miller’s wife.• $10,000 education allowance.• Full reimbursement for all costs associated with

his professional development.• Business class travel on hospital business.• All airline club memberships — which average

$400 a year per airline. • Annual membership dues in professional asso-

ciations and societies relating to Miller’s function atSchneider Regional.

• Reimbursement of all “reasonable and neces-sary” business expenses.

• $3 million family liability insurance.In addition, June Adams and the board also agreed

that the hospital would pay for:• Miller’s participation in Schneider Regional’s

group short-term disability benefit.• Own-Occupation Long-Term Disability insur-

ance policy for at least 70 percent of Miller’s totalannual compensation during the duration of hisemployment.

Under the terms of the contract, Miller also gotfour weeks of paid vacation annually, administrativeleave to attend professional conferences with allexpenses paid, the use of a 2005 Ford Explorer, alaptop computer, a cell phone and any other methodof communication deemed necessary.

Executive compensationThe V.I. government uses a Notice of Personnel

Action form to document all personnel transactions,and all of Miller’s NOPAs that are on file at V.I. gov-ernment’s Division of Personnel show a salary of$150,000 a year, far less than the amounts on hiscontracts.

Hospital board attorney Russell said that theamount on Miller’s NOPA was included in the$310,000 base salary.

According to Schneider Regional’s audited finan-cial statements for Fiscal Year 2006, the boardapproved a “supplemental payroll plan” for the hos-pital management team, which included Miller.

The auditors noted that the “supplemental payroll”account was maintained — and reconciled — bysenior management, which meant that the same peo-ple who received the supplemental payroll monieswere in control of those monies.

The board had no power to veto the CEO’s deci-sions about compensation for the management team.

The auditors, Pershing Yoakley & Associates,recommended that the board establish a separate for-mal review of the account to provide greater over-sight.

On July 16, 2008, the hospital board adopted anexecutive compensation policy that installs controlsthat were not in place when Miller was CEO.

The newly adopted policy requires that payments— other than salaries — to the senior managementteam be requested in writing, accompanied by sup-porting documents, and directed to the person who isauthorized to make the decision. The paymentsaffected by the new policy include performancebonuses, housing allowances, car allowances andeducation stipends.

For the CEO, the new policy gives the board thepower to approve compensation-related payments tothe CEO and states that the authorization must besigned by the board chairman before any funds canbe disbursed.

For the hospital’s other senior officers, the newpolicy gives the CEO the power to approve compen-sation-related payments and states that the requests

See MILLER CONTRACTS, page 7

MILLER CONTRACTSCONTINUED FROM PAGE 3 Rodney Miller Sr.

executive compensationThree-year contract signed in April 2002• $150,000 annual base salary• Up to $10,000 to relocate from Georgia to St. Thomas.• $20,000 annual housing allowance• Up to $500 for his membership dues in professional organizations. He was given the

use of a cell phone and pager.• Expenses-paid trips to conferences• Same fringe benefits other hospital employees received• Use of an automobile.• In September 2002, the hospital board increases Miller’s moving reimbursement to

$13,000.• In June 2003, the hospital board amended his contract to add a $15,000 bonus for good

performance.

Contract signed in May 2005• $265,000 base salary• Up to $79,500 for good performance.• $66,250 signing bonus• $53,000 retention bonus at the completion of each year of employment.• $40,000 housing allowance• $13,250 cost of living adjustment.• Hospital board agreed to reimburse Miller’s business expenses and to waive the

repayment of any amounts advanced to Miller prior to the execution of the agreement.• $125,000 annual contributions to an Irrevocable Rabbi Trust• Contributions of $41,660 to the Rabbi Trust account in December 2007 and

contributions of 8.4 percent of Miller’s base salary — an amount that would equal$26,040 in 2007 — as long as he was employed by the hospital.

• A $30,000 contribution to a 403(b)(7) individual retirement account.• A $2 million individually owned 30-year Guaranteed Renewal Level Term Life Insurance,

with premiums fully paid.• $400,000 group term life insurance• Contributions to the Government Employee Retirement System pension plan.• $10,000 travel allowance for Miller’s wife.• $10,000 education allowance.• Full reimbursement for all costs associated with his professional development.• Business class travel on hospital business.• All airline club memberships — which average $400 a year per airline. • Annual membership dues in professional associations and societies relating to Miller’s

function at Schneider Regional.• Reimbursement of all “reasonable and necessary” business expenses.• $3 million family liability insurance.• Cost of Miller’s participation in Schneider Regional’s group short-term disability benefit.• Cost of Miller’s Own-Occupation Long-Term Disability insurance policy for at least 70

percent of Miller’s total annual compensation during the duration of his employment.Under the terms of the contract, Miller also got four weeks of paid vacation annually,

administrative leave to attend professional conferences with all expenses paid, the use ofa 2005 Ford Explorer, a laptop computer, a cell phone and any other method ofcommunication deemed necessary.

Contract signed in May 2007• $310,000 base salary• Up to $93,000 in performance bonuses• $77,500 signing bonus• $125,000 annual contributions to an irrevocable Rabbi Trust, which is a financial arrangement

that allows an employee to get additional payments put into a tax-deferred account.• Contributions of $41,660 to the Rabbi Trust account in December 2007 and

contributions of 8.4 percent of Miller’s base salary — an amount that would equal$26,040 in 2007 — as long as he was employed by the hospital.

• A $30,000 contribution to a 403(b)(7) individual retirement account.• A $2 million individually owned 30-year Guaranteed Renewal Level Term Life Insurance,

with premiums fully paid up.• $400,000 group term life insurance• Contributions to the Government Employee Retirement System pension plan.• $10,000 travel allowance for Miller’s wife.• $10,000 education allowance.• Full reimbursement for all costs associated with his professional development.• Business class travel on hospital business.• All airline club memberships — which average $400 a year per airline. • Annual membership dues in professional associations and societies relating to Miller’s

function at Schneider Regional.• Reimbursement of all “reasonable and necessary” business expenses.• $3 million family liability insurance.In addition, the board also agreed that the hospital would pay for:• Miller’s participation in Schneider Regional’s group short-term disability benefit.• Own-Occupation Long-Term Disability insurance policy for at least 70 percent of

Miller’s total annual compensation during the duration of his employment.Under the terms of the contract, Miller also got four weeks of paid vacation annually,

administrative leave to attend professional conferences with all expenses paid, the use ofa 2005 Ford Explorer, a laptop computer, a cell phone and any other method ofcommunication deemed necessary.


chillers required a higher level of maintenance, themotors had burned out and had to be replaced, Cartysaid, according to board meeting minutes.

Since then, the radiation machine has been run-ning without problems — except when the powergoes out.

Then the machine goes down.Schneider Hospital is on a life-safety support sys-

tem, which keeps everything running at the hospitalduring the island’s frequent power outages — but theKimelman Cancer Institute is not on it.

Carty told the board in June that WAPA wouldinvestigate putting Kimelman on a more reliablefeeder or putting the Kimelman building on the hos-pital’s direct switch.

Unheard warningsThe Kimelman Cancer Institute does not function

independently from Schneider Hospital. The hospital’s governing board of directors over-

sees the Kimelman functions and finances, and thehospital management controls the KimelmanInstitute money.

Adams said that she always wrote up a monthlyreport for the hospital board, advising them aboutactivities and the situation at the Kimelman CancerInstutute. The reports went straight to Miller.

Hospital board records show that Miller gave theboard an edited summary, not the actual report, andhe deleted some of the information Renee Adamswas trying to warn the board about.

In her February 2007 monthly report to the board,Adams wrote that because of a delinquent paymentto Varian, the linear accelerator could not be serv-iced.

She reported that staff would not treat patients ifthey were not sure the machine was working proper-ly and they were worried about patient safety andabout losing their licenses.

Her report noted a troubling statement from adosimetrist who had quit. Dosimetrists work in radi-ation oncology, using a radiation oncologist’s ordersto generate radiation dose distributions and calcula-tions to come up with a treatment plan that will best

attack a tumor.The dosimetrist stated that she had quit because

she was “not willing to continue working in a situa-tion where the patient safety was compromised.”

That never made it into Miller’s written report tothe board.

In her March 2007 report to the board — whichagain went straight to Miller — Renee Adams wrotethat some patients had to be rescheduled becausetheir cancer medication was not available.

Miller did not give the board Adams’ report anddid not include all her concerns in his own report tothe board.

Even so, the board got wind that something waswrong.

Board member Francis Jackson Jr. told The DailyNews that he remembers the board discussing drugshortages on one or two occasions.

“As a board member, our job is oversight, so weof course are not involved in the day-to-day opera-tion of the hospital. We expect our senior leadershipteam to take care of those day-to-day administrativeduties that must be addressed to have a hospital runefficiently,” he said.

Board member Natalie Thomas said the board hadsome discussions “once or twice” about drug short-ages and problems with the linear accelerator but thatthe board was assured that senior management wasdealing with the problem.

“Of course we were all worried because the can-cer center was something that we were happy about.That is something that Mr. Miller was able to accom-plish for us,” she said. “We wanted everything to gowell for the cancer center.”

Beverly Chongasing, board member and formerchairman, said she was not aware of any problemsthe cancer center had in paying vendors, shortages ofchemotherapy drugs or lack of critical supplies.

“If it was a major problem, we would have knownabout it.”

Pastor Ray Joseph, also on the board at that time,said his recollection is that Renee Adams was veryconcerned about chemotherapy drug shortages butthat management was handling it.

“Amos Carty assured us that everything was backon a steady keel,” the pastor said.

That did not remain the case, as evidenced byadditional shortages and a lengthy shutdown of the

radiation machine later in the year. Carty, who was the counsel to the hospital board

of directors and also was the hospital’s chief operat-ing officer during the time Kimelman had drug andradiation service shortages, would not responddirectly to Daily News questions for this report.

Carty who now is the CEO, demanded to knowwhat documents The Daily News had and who hadtalked to The Daily News.

Carty pressed for information about The DailyNews investigative work, saying “I am not going torespond in a vacuum” and repeatedly urging, “Sharewith me what you have so I can look at it.”

Hospital documents The Daily News has used forthis story already are in the hospital’s files, to whichCarty has access.

Carty’s response to questions about the hospital’spayment of its cancer institute bills — an area forwhich Carty, as chief operating officer, would havehad oversight — was that he would not confirmwithout specific examples. “I don’t know the con-text,” he said.

When he was given a specific example, he said hecould not respond because “I don’t know the partic-ular situation.”

The current board chairman, June Adams,declined to be interviewed for this report. “I’m not inthe mood” to talk about it, she said.

Sam Topp also declined to comment, saying hewould have to first refresh his memory by reviewingminutes from past board meetings. Topp previouslywas on the board but now is the hospital’sspokesman with a contract paying him $75 an hourfor 20 hours of work a week.

ConfrontationThe cancer treatment shortcomings continued

well into 2007.On May 14, 2007, some Kimelman cancer doctors

and staff met with Miller in the institute’s conferenceroom and told him that unpaid hospital bills wereundermining proper care of patients, Renee Adamssaid.

Radiation oncologist Dr. Shirnett Williamsonidentified a litany of problems, which she describedin a memo to Adams that was presented at the meet-

May 19 — Renee Adams tellsthe Rotary Club of St.Thomas that constructionon the Kimelman CancerInstitute is expected to becompleted in July and agrand opening is projectedin August.

• • •

July 29 — Schneider RegionalMedical Center officials sendout an announcement thatthe opening date for theKimelman Institute has beenpushed back to October.The statement blames thepace of progress onweather, delays in gettingsupplies on island andunspecified “other issues.”

• • •

Nov. 16 — Kimelman is notopen. CEO Rodney MillerSr. tells the board that theinstitute might begintreating patients by the endof January 2006.

2006Jan. 17 — Kimelman is not

open. However, Schneiderofficials had set this datefor the opening and hadordered fancy invitations tothe gala dedicationceremony. The event isheld as planned. The galaceremony draws a largecrowd of dignitaries anddonors.

• • •

March 15 — Kimelman is notopen. Hospital officials tellthe board that constructionis wrapping up and theyexpect to open in April.They expect to beginoffering radiation therapy inMay.

• • •

May 17 — Kimelman is notopen. CEO Rodney MillerSr. tells hospital board thatDPNR approved acertificate of occupancyMay 8, but the architectfound “rippling” in thechemotherapy suite floorand that must be replaced.Supplies for that are nowon island, Miller says.

• • •

May 25 — SchneiderRegional officials announcethat the first patients havereceived radiation therapyat Kimelman.

Timeline

See TIMELINE, page 7 See PATIENTS, page 8



Schneider Regional Medical Center governing board chairman June Adams, left, CEO Amos Carty Jr. and spokesman Sam Topp, a former board member.


and authorizations are to be available for the boardchairman to review.

The existence of a loosely controlled “supplemen-tal pay plan” raises questions, including who gothow much money from it. The Daily News is pursu-ing answers and is awaiting the board’s reponse tothe newspaper’s written request for the information,which the newspaper submitted under the terms ofthe V.I. Open Records law.

Contract historyIn April 2002, 29-year-old Rodney Earl Miller

started his job Schneider Hospital — his first posi-tion as a chief executive officer.

Miller got a $150,000 annual base salary, anamount close to the base salary currently earned byLuis Hospital Chief Executive Officer GregoryCalliste, who earns $165,000 a year.

Eugene Woods, the chief executive officer atSchneider Regional before Miller, got a three-yearcontract in 1998 for $135,000 a year.

Woods’ benefits included 24-hour use of a gov-ernment vehicle, travel to two off-island profession-al development activities a year — but limited to nomore than $2,500 for each trip — transitional hous-ing allowance not to exceed $4,500, re-locationexpense not to exceed $10,000, and two weeks ofvacation.

It was not clear whether Woods’ compensationchanged since 1998. Board attorney Russell told TheDaily News in a March 26, 2008, letter that a fullyexecuted version of Woods’ contract could not belocated, and if found would be provided to the news-paper.

The hospital has not produced Woods’ contract.Miller in 2002 got benefits similar to those Woods

received, including the expenses-paid trips to confer-ences, the same fringe benefits other hospitalemployees received, use of an automobile, and up to$10,000 to relocate from Georgia to St. Thomas.

The board did give Miller a $20,000 annual hous-ing allowance — a perk not included in Woods’ con-tract — and agreed to pay up to $500 for his mem-bership dues in professional organizations. He wasgiven the use of a cell phone and pager.

In comparison, as the CEO of the hospital on St.Croix, Calliste gets a housing allowance of $1,800 amonth — which calculates out to $21,600 a year.Calliste receives an automobile allowance of $300 amonth, which amounts to $3,600 a year.

Calliste’s contract allows him reimbursement ofup to $25,000 in moving and relocation expenses,paid membership in professional organizations, theopportunity to attend three seminars for professionaldevelopment annually and a cell phone and laptopcomputer for business. It also makes him eligible foran annual performance bonus, although Calliste saidhe’s never received one.

Calliste said that his membership in theAssociation of Health Care Executives amounts to$325 a year, that he has attended three professionalseminars in the past four and a half years and that hehas collected a total of $3,500 for relocation expens-es at this point.

Soon after Miller took the Schneider CEO job inApril 2002, his pay scale and benefits began to soar.

In September 2002, the board upped Miller’smoving reimbursement to $13,000.

In June 2003, just over a year after Miller took thehelm at Schneider Hospital, the hospital board,chaired at the time by Beverly Chongasing, amend-ed his contract to add a $15,000 bonus for good per-formance.

In May 2005, the hospital board boosted Miller’spay and loaded his contract with extravagant bene-fits.

The board approved a new two-year contract forMiller that gave him a 77 percent pay raise, puttinghis base salary at $265,000. The new contract alsogave Miller up to $252,000 in monetary bonuses andmoney to cushion him from the territory’s cost of liv-ing.

The bonuses included:• Up to $79,500 for good performance.• $66,250 signing bonus, which was 25 percent

of his annual base salary.• $53,000 retention bonus at the completion of

each year of employment.• $13,250 cost of living adjustment.• $40,000 housing allowance, which was a 100

percent raise over his previous housing allowance.Under that 2005 contract, the board agreed to

reimburse Miller’s business expenses and to “waivethe repayment of any amounts advanced to Millerprior to the execution of this agreement.”

Board attorney Russell said that he would have toget authorization from the board to disclose anyinformation about that waiver.

Miller’s 2005 contract featured the same packageof perks, deferred compensation benefits and insur-ance policies as listed in the 2007 contract.

Board member Natalie Thomas justified Miller’scompensation, saying the board believed Miller haddone very well for the hospital. Thomas told TheDaily News that she was a member of the board’scompensation committee that reviewed a reportshowing the average compensation and benefit pack-ages for chief executive officers for similar-size hos-pitals nationwide.

She said the committee wanted to put Miller with-in the 50th to 75th percentile on that list.

Miller’s 2005 contract provided for a large sever-ance package under certain conditions. For example,he would be able to collect the severance pay if hedecided to resign because “a change in board struc-ture or membership adversely impacted his ability tofulfill the provisions of his contract.”

That clause gave him a lucrative exit strategy thatthe board could not control — because the board

does not have any say about its structure or member-ship. The V.I. governor appoints seven people to thenine-member hospital board and the Senate confirmsthose nominations. The two remaining members area doctor and a nurse, who are elected by members oftheir own professions.

Nonetheless, the board agreed in the contract togive Miller a severance package if he chose to leaveunder the “Change of Control” clause — a packagethat included paying his base salary, his retentionbonus, his housing allowance, his rabbi trust, reloca-tion expenses, and to make the payments for variousinsurances and to his retirement accounts — for afull year after he left.

The same clause was in the 2007 contract, butwith a significant difference: The board agreed topay Miller the whole package for three years after heleft.

Board attorney Russell told The Daily News thatwhen Miller left the job in November 2007, he hadvoluntarily resigned and that, under the contract, hedid not get a severance package and the hospital is nolonger compensating him in any way.

The board did not not let Miller go away empty-handed, however. In October 2007, just beforeMiller left to take a position at Memorial RegionalHospital in Hollywood, Fla., the board passed a res-olution citing a number of Miller’s accomplish-ments, including the hospital’s gaining accreditation,the Charlotte Kimelman Cancer Institute’s opening,the expansion of services, the increase in net rev-enues and cash collections, and the affiliation ofSchneider Regional with medical facilities in thestates.

The board awarded him the title “HonoraryPresident and Chief Executive Officer Emeritus.”

• • •

June — Schneider Hospital’saccreditation is threatenedby lab problems discoveredduring a Joint Commissionlab inspection in November2005. A preliminary denial ofaccreditation was issued inMarch 2006 and the hospitalis in the appeals process.

• • •

June 27 — The JointCommission stripsSchneider Hospital andMyrah Keating SmithCommunity Health Centerof accreditation because ofwhat was found in the labsurvey. Hospital officialsdecide to forgo a finalavenue of appeal andinstead ask for animmediate re-survey.

• • •

June 30 — SchneiderRegional officials announcethat after a JointCommission re-survey, thehospital has regained itsaccreditation.

• • •

July 5 — Schneider Regionalofficials hold a pressconference to hail thestaff’s efforts in achievingreaccreditation. They call formore government funding.

• • •

July — V.I. HealthCommissioner Darlene Cartysets a July 31 deadline forSchneider Hospital tosubmit documents she saysare required before she canrenew its expired license tooperate in the territory. TheHealth Commissioner says afinancial report and anannual report are necessary;hospital officials disagreeand say those documentsare not required by V.I.Code. The lapsed licensehas the potential to affectthe hospital’s accreditationand its ability to bereimbursed by Medicare andMedicaid.

• • •

July 11 — Chemotherapy isfully transitioned fromSchneider Hospital to theKimelman Cancer Institute

• • •

July 18 — Senate FinanceCommittee Chairman LouisHill asks the V.I. InspectorGeneral to conduct an auditof Schneider RegionalMedical Center.

Timeline


MILLER CONTRACTSCONTINUED FROM PAGE 5 Schneider Hospital

top-level pay packagesAmos Carty Jr.• 1999 NOPA — Promoted him from Schneider Hospital chief legal counsel to general counsel,

raising his salary from $64,000 a year to $80,000. • 1999 Stipend Agreement — Board attorney Steve Russell said it would be provided to The

Daily News, but it was not.• 2002 Stipend Agreement — Promoted him to chief operating officer but retained the position

of general counsel. For the additional responsibility, the agreement gave Carty an additional$1,538.46 every two weeks — amounting to $40,000 a year. Schneider Regional CEO RodneyMiller Sr. and Carty signed the agreement.

• 2004 NOPA — Promoted him from general counsel to chief operating officer and generalcounsel, retroactive to Nov. 11, 2002, at a salary of $80,000. The NOPA was executed Feb.11, 2004 and signed by Miller.

• 2004 Amended Agreement — Raised his stipend to $1,838.46 every two weeks — givinghim $47,799 a year over his $80,000 provided via the 2004 NOPA. Miller signed theagreement Feb. 19, 2004, and Carty signed it on Feb. 12, 2004.

• 2005 Letter — Miller informed Carty via letter on Nov. 7, 2005, that his compensation wouldbe structured with an annual base salary of $189,600 and an annual incentive bonus of 15percent of his base salary, or $28,440. The raise was retroactive to Aug. 1, 2005.

• 2007 NOPA — Promoted him from chief operating officer and general counsel to presidentand chief executive officer, at a salary of $150,000, effective Nov. 5, 2007.

• 2008 Interim Employment Agreement — Gives Carty an annual salary of $259,600 andentitles him to continue “all benefits provided to him by Schneider Regional under theterms of his previous agreement for the positions of chief operating officer and generalcounsel.” Signed by hospital board chairman June Adams on May 14, 2008, butretroactive to Nov. 5, 2007.

Peter Najawicz• 2004 NOPA — Hired him as chief financial officer effective April 19, 2004, at an annual salary

of $80,000. Signed by Rodney Miller.• 2004 Stipend Agreement — Gave Najawicz an additional $20,000 at year over his $80,000,

effective April 19, 2004 and signed by Rodney Miller.• 2005 Letter — Miller informed Najawicz via letter on Nov. 7, 2005, that his compensation

would be structured with a base salary of $173,800 and an annual incentive bonus of 15percent of his base salary or $26,070. The compensation was retroactive to Aug. 1, 2005.

Sam Topp• 2008 Professional Services Contract —Awards Topp a contract to provide public

information, media and publicity services for $75 an hour. Topp is required to work atleast 20 hours a week exclusively for Schneider Regional. The contract is not to exceed$75,000 a year. Signed by Topp on Nov. 19, 2007, and by Carty on March 6, 2008.

• • •

July 21 — Gov. CharlesTurnbull intervenes in thedispute between the HealthCommissioner and hospitalofficials. He holds ameeting with the two sidesand produces an agreementto renew the hospital’slicense.

• • •

July 26 — SchneiderRegional celebrates the fulltransition of medicaloncology services to theCharlotte Kimelman CancerInstitute with aninauguration and ribbon-cutting ceremony.

• • •

August — SchneiderRegional’s $659,826 billfrom Varian MedicalSystems for the radiationmachine is 90 days overdueand Varian stops serviceuntil it gets a payment.

• • •

September — Kimelmanadministrator Renee Adamsrushes a $234,416 check toVarian Medical Systems viaExpress Mail.

• • •

December — SchneiderRegional financial reportsshow a $35.1 millionoperating loss. When thegovernment’s contributionsare figured in, the overall lossdrops to around $6.5 million.

• • •

December — Prostate cancersurvivors form a supportgroup.

• • •

December – The V.I.Inspector General’s Officeand the U.S. Department ofthe Interior InspectorGeneral’s Office launch anaudit of Schneider RegionalMedical Center.

2007Jan. 17 — The hospital board

adopts a 2007 budget thatanticipates operatingrevenues will drop slightlybut operating expenses willclimb.

• • •

January — KimelmanInstitute establishes a 16-member review board — anecessary first step toparticipate in clinical trialsand research.


ing with Miller.“It is a shame and a horrible moral predicament to

be in to watch patients die or be improperly treatedbecause a hospital bill was notpaid for supplies,” Williamsonwrote in the memo.

She described other dire situa-tions created by the hospital’sfailure to pay the bills. Theyincluded:

• She wrote that she hadresorted to using her own creditcard to buy urgent supplies forher patients. She blamed thechronic shortages on the hospi-tal’s failure to pay bills, and she suggested ways tofix the problem.

• She asked whether the linear accelerator billhad been paid off — or whether doctors shouldexpect the company to keep refusing service.

• She wrote that Kimelman staff had left becausethey did not want to be associated with an institutionthat could hurt their reputations.

“I feel the same, but am here at this time to helpchange the system. If I can’t overcome the frustra-tion, then it would be difficult to stay,” Williamsonwrote in May 2007.

This month, Williamson reluctantly agreed tomeet with The Daily News. In the interview, sheacted nervous about discussing about hospital prob-lems and said all questions should be directed to thehospital management.

When The Daily News showed her a copy of hermemo presented at the May 2007 meeting,Williamson fell silent for a long while.

She then acknowledged that she wrote the memoand that all the problems she wrote about had exist-ed.

She retreated from her statement, contained in herwritten memo, about watching patients die because ahospital bill was not paid. Williamson said she justdid not remember.

Most of the problems she was complaining aboutback in May 2007 no longer exist, she said.

“We’ve come a long way,” she said.Edward Aribisala, who is Schneider Regional vice

president of oncology services and who took thehelm at the cancer institute May 19, 2008, said hehas not encountered the problems that earlierplagued the institute.

“Evidently, they must have been rectified before Icame on board,” he said.

Dr. Rabindranath Bachan and Dr. CondonRichardson, husband and wife, are the medicaloncologists at Kimelman. Richardson specializes inpediatric oncology.

Bachan, who started working at the institute inAugust 2006, said during a recent interview at hishome that he could recall only a handful of times thatchemotherapy treatments were not available. He saidthat the delays were only one or two days, and onlythree or four patients were affected.

Bachan said in his recollection, the only meetingbetween Kimelman staff and Miller was a 10-minutemeeting where Miller told everyone they were doinga good job.

Big paychecks, broken promisesOn the same day in May 2007 that Kimelman staff

urged Miller to pay the bills, Miller landed thebiggest compensation packages ever awarded to apublic official in the territory.

The contract, signed by hospital board chairmanJune Adams, paid Miller $536,000 a year in salary

and bonuses plus $222,700 in tax-deferred compen-sation. He also got and a lavish package of perks.

The compensation package included an immedi-ate $77,500 bonus for just signing the contract,$55,000 housing allowance and cost of living adjust-ment to help him offset the high cost of living in theterritory, and $10,000 in travel money for his wife.

According to May 15, 2007, minutes of a hospitalsenior leadership meeting with the CEO — Millerdiscussed several outstanding payments to criticalvendors and apologized for the lack of much neededin-house supplies. Discussion ensued about cashflow and the management of payments, the minutesindicate.

Miller told his senior managers that he was con-cerned that the credit holds from vendors could putthe hospital at risk with regulators: the JointCommission on accreditation of health care organi-zations and the U.S. Centers for Medicare andMedicaid Services, according to the minutes. Millermentioned that medical staff had met and expressedconcerns about late payments and shortage of sup-plies.

He said he discussed the payments with Carty andchief financial officer Peter Najawicz. Miller alsosaid the hospital had a new director in material man-agement to handle payments to critical vendors.

At the meeting with Kimelman staff, Miller prom-ised to end the problem of unpaid bills, Adams said.She recalls that he pledged:

“It will never happen again.” But it did.Periodic lack of drugs for cancer patients contin-

ued throughout the summer, Renee Adams said.On Aug. 28, 2007, Adams received an alarming

memo. Her executive assistant wrote it to alert herabout a dire situation: The cancer institute did nothave four of the drugs necessary for providing can-cer treatment.

“Unfortunately they cannot treat their patientsagain today due to the shortage of medication fromthe pharmacy,” the memo said.

Keep quiet or elseAdams said that she and some of her col-

leagues at Kimelman “spent a lot of time beg-ging” hospital officials to pay the bills in a time-

ly manner.“We were given lip service. But patient care

was not number one. “It was all about putting on a public face and

speaking all kinds of stuff. Miller was good atthat,” Adams said. “Behind the scenes, it wastotally the opposite.”

After a terminally ill cancer patient called in toa local radio talk show and complained aboutshortcomings at Kimelman, Miller told Adams totalk to the patient and make it clear to her that ifshe continued to speak to the media about theproblems, her treatment would be cut off until shepaid her bill in full.

“I told him I couldn’t do that,” Adams said.Miller did not respond to telephone and mail

messages from The Daily News seeking his com-ment for this story.

Adams said she believes that the midcoursedelays in treatment caused some patients to diesooner than they would have if Kimelman hadgiven them their treatments as scheduled.

“I sincerely believe they died as a result of nothaving the medications that could have extendedtheir life and given them some kind of quality oflife,” she said.

“I really believe that had they gotten continu-ous treatment, they would have lived longer.”

Adams was fired from her position in August2007. Hospital officials declined comment on herdeparture.

Adams said she was called in to see Miller atthe end of the day, and he told her he did notbelieve she could take the cancer institute “to thenext level.”

Other reasons she was given for the termina-tion were that she had not gone down-island tomarket the institute and that she was not a “teamplayer,” she said.

Adams said Miller offered to give her a year’ssalary — $80,000 and benefits — if she agreednot to talk about the hospital or the cancer insti-tute at any time, then or in the future.

Miller gave her 20 minutes to decide, she said.Adams decided to say no, and she walked

away.“I will not sell my soul,” she said.

Timeline




Hospital board chairman June Adams, foreground, and board member Beverly Chongasing.

“It is a shame and a horrible moral predicament to be into watch patients die or be improperly treated

because a hospital bill was not paid for supplies.”— Radiation oncologist Dr. Shirnett Williamson in a May 2007 memo

Dr. ShirnettWilliamson

factor in his selection.He said that it would have been an oversight by

the board “if we didn’t truly investigate his militarybackground.”

That background is fully detailed in the Navy’sopen public records.

According to the Navy, Miller went on a spendingspree at someone else’s expense.

The charging document states that the spree beganwhen Miller, while on active duty, stole Visa and

Discover credit cards from Dental Technician 3rdClass Michael W. Cochran.

Over a period of days in December 1994, Millerused those credit cards in Beaufort, S.C., to steal:

• $448.94 in electronics, including a color televi-sion set, a video cassette recorder and a SonyWalkman from K-Mart.

• $266.53 for slacks, outdoor footwear, men’sunderwear, suspenders, and one pair of men’s casu-al shoes from J.C. Penney Department Store.

• $168 for merchandise he bought from Belk’sDepartment Store.

• $74.99 for a “Dallas Stars” Pro Hockey shirtfrom Sportsman Department Store.

• $88 for a Tommy Hilfiger sport shirt fromBelk’s Department Store.

• $55 for a Fila jog suit from New Yorkers Store.• $30 for a shirt or pair of pants from New

Yorkers Store.• $18 in gasoline.The Navy charged Miller in May 1995 with nine

counts of larceny and two counts of attempted larce-ny and ordered him to undergo a general court-mar-tial.

The Navy later added yet another charge againstMiller after he tried to thwart his prosecution by con-

• • •

Feb. 6 — Doctors atSchneider Regional performa seed implant procedureon a patient with prostatecancer. The treatmentinvolves implanting tinyradioactive seeds into theprostate to treat the cancer.

• • •

Feb. 7 — Schneider Regionalofficials hold a ceremony todedicate the KimelmanInstitute’s radiationoncology suite, named forRichard Stephenson. He isthe founder of CancerTreatment Centers ofAmerica, which donated$250,000 to the institute.

• • •

March 16 — Hospitalannounces that radiationtherapy at the CharlotteKimelman Cancer Institutehas been down sinceMarch 12.

• • •

March 21 — Radiationtherapy resumes atKimelman, after a newtransformer is received. Dr.Shirnett Williamson saysthat eight patients wereundergoing radiationtherapy when thetransformer went down.

• • •

March 28 — The hospitalboard hears a proposal fromMedical OutsourcingServices to provide PositronEmission Tomography,known as PET scanning. Itis used in cancer diagnosisand treatment evaluation.

• • •

April 18 — The hospital boardvotes to enter into anagreement with MedicalOutsourcing Services,which will provide the PETscan and the hospital willprovide the space to parkthe machine, which ishoused in a large trailer.

• • •

May — PET scanning areoffered at the hospital.

• • •

May 14 — CharlotteKimelman Cancer Institutestaff confront ChiefExecutive Officer RodneyMiller Sr., telling him thehospital’s failure to pay itsbills was underminingpatient care.

• • •


Timeline


MILLER CONVICTIONCONTINUED FROM PAGE 3

Miller’s Schneider Hospital application formSee MILLER CONVICTION, next page


May 14 — SchneiderHospital board gives Millerthe biggest compensationpackage ever awarded to apublic official in theterritory: $536,000 in salaryand bonuses annually,$222,700 in tax-deferredcompensation and a lavishpackage of luxury perks —which included travel forhimself plus $10,000 ayear in travel money for hiswife.

• • •

July 18 — Schneider boardvotes to execute a contractworth up to $350,000 withRPM Health GroupInternational for consultingon a performance-improvement project.

• • •

July 19 — SchneiderRegional launches theproject, calling it a newinitiative for organization-wide culture change.

• • •

Aug. 29 — Renee Adams isfired from her position asKimelman administrativedirector.

• • •

Sept. 20 — Rodney MillerSr. resigns, effective Nov.3, to take a position atMemorial Regional Hospitalin Florida. Chief operatingofficer Amos Carty Jr. willbe promoted to the CEOpost when Miller leaves.

• • •

Oct. 24 — The hospital boardnames Rodney Miller Sr.honorary president andchief executive officeremeritus.

• • •

Oct. 24 — The board adoptsa 2008 budget projectingan overall loss of $12.99million.

• • •

Nov. 14 — The board hearsa report on the medicalcenter’s 2007performance. Operatingrevenues were $59.9million, and operatingexpenses were $101.34million amounting to a$41.39 million loss. Theaddition of governmentappropriations and othernon-operating revenuesreduced the overall loss to$7.54 million.

• • •

Timeline


cocting an elaborate web of lies — a scheme inwhich he lured fellow sailors to help him create abogus alibi by fabricating official documents.

The Navy charged that:• Miller went to the Marine Corps Air Station

Morale Welfare and Recreation Library in Beaufort,S.C., on several occasions and asked the librariansfor the sign-in sheets for the month of December1994. That was the same month he stole the creditcards.

• Miller made photocopies of the filled-in sign-insheets, and he also made photocopies of blank sign-in sheets.

• Miller approached more than four other fellowNavy dental technicians to draw them into hisscheme to create fake sign-in sheets.

• Miller asked them to sign their own names onthe blank sheets or copy other people’s names off thelegitimate sign-in sheets onto the blank sign-in sheet.He instructed them to write in a fake sign-in for thedate — December 13, 1994 — when some of hiscrimes occurred.

• Miller then added his own name onto the fakelibrary sign-in sheet in an attempt to show that hewas in the library with the other sailors at the time hewas in Beaufort, S.C., committing the thefts.

• Miller took the fake sign-in sheet to the MarineCorps library, asked for the December 1994 sign-insheets again, and secretly slipped the fake documentin among them.

• Miller lied to his civilian attorney, telling himhe had an alibi and showing him copies of the fabri-cated sign-in sheet.

For the cover-up scheme, the Navy charged Millerwith violating the general article of the Code ofMilitary Justice, which includes “all disorders andneglects to the prejudice of good order and disciplinein the armed forces, all conduct of a nature to bringdiscredit upon the armed forces, and crimes andoffenses not capital, of which persons subject to thischapter may be guilty.”

Miller pleaded guilty to all nine of the larcenycharges.

He also pleaded guilty to one of the attempted lar-ceny charges and guilty to the charge of violating thegeneral article by obstructing justice. Miller’s gener-al court-martial was in September 1995 and was heldbefore a military judge — similar to a bench trial inthe civilian justice system.

A court-martial is a military — not civilian – pro-ceeding, and the military justice system works dif-ferently from the civilian system.

In a court-martial, the member of the armed serv-ice accused of a crime is allowed to work out a pleadeal, similar in some ways to a plea deal in the civil-ian system. The deal has two parts: The first spellsout terms the accused has agreed to, such as testify-ing against others or making restitution for hiscrimes. The second sets limits on particular punish-ments that the judge may order.

However, unlike in the civilian system, a court-martial gives the accused person a chance to “beatthe deal.”

In a court-martial, the judge does not know whatis in the second part — the part that sets punishmentlimits.

Once the accused pleads guilty, the military judgehands down a sentence and it is then that the judgelearns what the second part of the plea deal says.

In the end, whichever is punishment is less — thejudge’s sentence or the plea deal sentence — pre-vails.

In Miller’s case, the plea deal benefited him.Miller’s jail sentence was limited to 10 months — ifhe paid restitution to Visa and Discover.

The military judge had ordered him to forfeit $850a month, but under the plea deal, that was limited to$500 a month for 10 months.

Miller did not have a plea deal for the type of dis-charge he would receive. The military judge orderedMiller reduced in pay grade and discharged from theservice with a bad conduct discharge.

A bad conduct discharge is a punitive discharge. Itis a separation from the service under conditionsother than honorable. It is designed to be a punish-ment for bad conduct.

When Miller filled out his V.I. government jobapplication in May 2002, he checked a box indicat-ing he received an honorable or general discharge.

His bad conduct discharge cannot truthfully becalled an honorable discharge or a general discharge.

But Miller signed a statement at the end of his jobapplication attesting that the information he provid-ed was accurate and complete and that he understoodthat any intentional falsification or misrepresentationon the application could result in his dismissal.

Miller went into the brig on Sept. 13, 1995 — theday of the court-martial — and was released on May18, 1996, according to information The Daily News

1

2

See MILLER CONVICTION, next page


obtained from Navy Personnel Command.In the military justice system, a bad conduct dis-

charge cannot be executed until there is an appel-late review. Miller’s case automatically went to theU.S. Navy-Marine Corps Court of CriminalAppeals.

Typically, when an appeal is pending, a Navymember who has served his jail time and whosepunitive discharge has not yet been executed maybe placed on a special kind of leave — appellateleave — until a final decision is made, said JenniferZeldis, a spokeswoman for the Navy JAG.

While on that kind of leave, the service membermay pursue work in the civilian sector.

Miller’s resume on file with the V.I. PersonnelDivision states that he started an internship as anadministrative resident with the Medical Center ofCentral Georgia in June 1996.

In November 1998, a three-judge panel at theU.S. Navy-Marine Corps Court of CriminalAppeals upheld the court-martial findings andupheld the sentence that the original court-martialhanded down, concluding that they were “correct inlaw and fact.”

The appeals court disagreed with Miller’s con-tention that the bad-conduct discharge was inap-propriately severe.

The appellate court wrote that its duty was not toexercise clemency but to determine whether thesentence was appropriate.

“Taking fully into account the appellant’s excel-lent record of military service and his off-dutyachievements, we still believe that a bad conductdischarge is not inappropriately severe” for hisoffenses, the decision states.

Although Miller had agreed to a plea deal in thecase — and had received a reduced punishmentbecause of it — he nonetheless took his appeal astep further, to the U.S. Court of Appeals for the

Armed Forces.But in May 1999, the U.S. Court of Appeals for

the Armed Forces denied Miller’s request for areview of the decision of the appellate court.

In April 2000, Miller was officially dischargedfrom the Navy with a bad conduct discharge.

Two years later, almost to the day, the SchneiderHospital board announced that it had selected himto be chief executive officer of Schneider Hospital.


November — Amos Carty Jr.names his seniormanagement team. Hepromotes Angela Rennalls-Atkinson to chief operatingofficer; promotes ElizabethHarris to vice president forquality and performanceimprovement; promotesBlondell Williams to vicepresident for nursing andpatient care services, andnames Adeline Williams-Connor the administrator ofSchneider Regional’s newEducational Institute.

• • •

Nov. 29 — V.I. Superior CourtJudge Michael Dunstonbars the public from a courthearing on production ofdocuments subpoenaed byinvestigators in the ongoingjoint local-federal audit ofSchneider Regional.

• • •

Dec. 1 — Gov. John DeJonghJr. denounces governmentdysfunction in V.I.commissions, boards, andsemi-autonomous agenciesin a speech at GovernmentHouse. He criticizesSchneider Regionalofficials’ move to quash asubpoena for documentsneeded in the joint local-federal audit.

2008Feb. 20 — Schneider

Regional holds a pressconference to announcethe hiring of EdwardAribisala as vice presidentof oncology services andadministrator at Kimelman.

• • •

Feb. 20 — The hospital boardhears from an architectwith Stanley, Beaman andSears about potential plansand options for futuredevelopment andimprovements at thehospital.

• • •

May 15 — SchneiderRegional officials launch the“It takes all of us!” mediacampaign to boost thehospital’s image.

• • •

July 16 — Hospital boardadopts an executivecompensation policy thatinstalls controls not in placewhen Rodney Miller Sr.was CEO.

— Daily News staff

Timeline3

4


Military justiceCourt-martial — A military court. Brig — A military jail.JAG — Judge Advocate General’s Corps,

the legal branch of the U.S. militaryUniform Code of Military Justice —

The body of laws governing membersof the U.S. armed services worldwide.The punitive articles of the UCMJinclude some provisions similar tocivilian law, but they also containprovisions distinctive to the military,such as deserting, failing to obey anorder, being drunk on duty.

Grade of discharge — The five grades ofseverance from the military areHonorable, General (Under HonorableConditions), Other Than Honorable(OTH), Bad Conduct, and Dishonorable.The first three are given without ajudicial process. The last two are theoutcome of conviction by a courtmartial. The grade of discharge canaffect a person's eligibility for veteran’sbenefits. Honorable and Generaldischarges qualify a veteran for mostVA benefits, but Dishonorable and BadConduct discharges may bar VAbenefits.

Bad conduct discharge — A punitiveseparation from the service orderedafter the service member has beencourt-martialed and found guilty of aviolation of the UCMJ. It is designed tobe a punishment for bad conduct and isa separation from the service underconditions less than honorable.

Dishonorable discharge — A punitiveseparation from the service orderedafter the service member has beencourt-martialed and convicted of aviolation of the UCMJ.

General discharge — A non-punitiveseparation from the service that iswarranted when significant negativeaspects of the member's conduct orperformance of duty outweigh thepositive aspects.

Source: Judge Advocate General’s Corps



K enisha Crossley just wanted to gohome.

The bright, talented teenager fromSt. Thomas — who had already spentmore than two years of her life battlinga rare cancer of the muscle cells —had a choice: Go through a new fullround of aggressive cancer treat-ment in Miami or take a mildercourse of chemotherapy thatwould allow her to return toSt. Thomas for treatment.

To her mother, AvonCrossley, Kenisha’s storyspeaks to everything thatis right — and wrong —about the CharlotteKimelman CancerInstitute.

Kenisha, like manyVirgin Islanders whohad to travel far fromhome for cancer treat-ments, longed to behome, close to herfriends and her familyand everything sheloved.

Kenisha was afighter — full ofcourage — but she felthad already beenthrough too much, hermother said.

And she had.“Mommy, I just want

to go back home.” shetold her mother.

The nightmare beginsKenisha was full of spirit,

smiles and kind words. Sheloved her family, photography,and music. She played clarinet andtaught herself how to play keyboard.

She also spent time writing down herfavorite scriptures from the Bible and heraffirmations of faith.

Her list of inspirational scriptures was longbecause she turned to them often for strength todeal with what was happening to her. The list istucked away in a scrapbook that she made andtitled “A Life Experience to Remember.”

“For we wrestle not against flesh and bloodbut against principalities, against powers,against the rulers of the darkness of this world,against spiritual wickedness in high places,”Kenisha copied into the scrapbook followed byone of her life-affirming prayers:

“ThereforeFather I stand onyour work in Ephesians 6:12 which assures methat this cancer in my body is the work of thedevil and not of you, which means that I have

“For we wrestlenot againstflesh and bloodbut againstprincipalities,against powers,against therulers of thedarkness of thisworld, againstspiritualwickedness inhigh places.”

— Ephesians 6:12, one of Kenisha Crossley’s

sources of comfort

See KENISHA, page 14

How one patient closed the book on despair

A life too shortKenisha was a child of faith who looked to God

for strength as her mother looked to Kmart for the drugsthey could not count on from the Kimelman Institute

During her long fightagainst cancer, Kenisha

Crossley turned to herscrapbook full of inspirational

scriptures and messages from loved ones.

A life too shortKenisha was a child of faith who looked to God

for strength as her mother looked to Kmart for the drugs they could not count on from the Kimelman Institute

Oct. 16,1989 • Kenisha Crossley • Feb. 28, 2007


the right to proclaim my healing, and I thankyou Father that I am whole from the top of myhead to the sole of my feet and I am healed inthe name of Jesus.”

Kenisha was a child of strength and faith,even against great odds, Crossley said.

In 2003, when Kenisha was 13, she wasdiagnosed with rhabdomyosarcoma, a rare can-cer of the muscle cells.

The prognosis was bleak.The Crossleys sat with the doctors and dis-

cussed the options. Doctors gave Kenisha twomonths to live without treatment. With treat-ment, they said, she had only a 25 percentchance of surviving, her mother said.

The treatment for that type of cancer was notavailable in the Virgin Islands, so Kenisha andher mother opted to stay in Miami to be nearJackson Memorial Hospital.

There, Kenisha underwent a cadre of tests,surgery, and radiation and treatments. Thechemotherapy protocol for Kenisha’s rhab-domyosarcoma was extensive.

Avon Crossley said that at JacksonMemorial, she and her daughter experiencedfirst-hand how a cancer treatment center shouldwork. The care was patient-oriented, and eachchild was assigned to a team of medical profes-sionals who were readily available to parents.

“Anything happen to your child, you canapproach your team,” she said. “Because of theteam concept, you never felt lost in the sys-tem.”

Kenisha was beloved by hospital workersand other patients, but she sorely missed herfamily, friends, and home.

The doctors allowed Kenisha to come homefor one visit, at Christmas 2003, but they took

pains ahead of time to ensure that SchneiderHospital had her chemotherapy drugs. Crossleysaid that the one treatment her daughterreceived at Schneider went as scheduled.

Kenisha returned to Miami to continuereceiving treatment there, and in late 2004, hercancer went into remission.

Full of hope, mother and daughter movedback to St. Thomas.

“When we left Miami, our lives were differ-ent, and we started to pick up the pieces ofwhat was torn apart with us traveling somuch,” Crossley said, recalling her daugher’shappiness.

“She came home having in mind that hernext step was graduation.”

“She was almost back to normal,” Crossleysaid with tears in her eyes.

The nightmare returnsIn April 2005, everything changed. Kenisha fell critically ill and had to be air-

lifted to Puerto Rico. The cancer was back andit was more aggressive than before.

“It was like the wind being knocked out ofme for a second time,” Crossley said. “Becausehere it is, we were at a high point and every-thing was going so well. She was doing greatin school.

“Our family was pretty much almost back onour feet getting readjusted to her care. I felt —I felt awful.”

Crossley said that doctors had warned themthe cancer might return, but the family clung tohope.

“You know that it could happen, you pray itnever happen, but now you are faced with thefact that it has happened,” Crossley said.

Doctors ordered a full course of chemotherapy,using a protocol designed to combat a recurrence

Mother anddaughtershowed up for theappointment,only to be toldthat the drugKenisha had totake wasn’tthere.

“I was angry.We actually gotthere and oneof the nursessaid theycouldn’t giveher the chemo,”Avon Crossleysaid.

KENISHACONTINUED FROM PAGE 12

See KENISHA, next page

Daily News Photo by SEAN McCOY

Avon Crossley holds the scrapbook her daughtermade before she lost her fight with cancer.


of cancer.After a while, doctors saw that the recipe of

drugs she was getting was doing more harmthan good. They eliminated some of the drugsand ordered an abbreviated chemotherapy regi-men.

Kenisha felt better, but the cancer continuedto grow. Eventually, the doctors in Puerto Ricoquestioned whether the new regimen was worthit and sent Kenisha back to Miami.

Crossley said doctors there were willing totreat the cancer aggressively with everythingthey had. Or, they said, Kenisha could go backto the abbreviated regimen — which she couldget on St. Thomas.

“It comes to a place where they stop treatingthe cancer and start treating for quality of life,”she said.

For Kenisha, the choice was simple: She didnot want to be far away from the place andpeople she loved.

Home againIn early 2006, Kenisha began to receive

treatment on St. Thomas, the newly builtCharlotte Kimelman Cancer Institute was notyet taking patients, but Schneider Hospital pro-vided chemotherapy threatments on its fifthfloor, Crossley said.

Outpatients were transferred to CharlotteKimelman that summer.

Crossley praised the doctors, nurses and staffthere — she said they went far above andbeyond the call of duty to care for Kenisha —but it soon became clear that Kenisha was notin Miami anymore.

“The biggest challenge was the medicationsgetting there,” Crossley said.

She said that hospital staff told her that themedication shortage was caused by problemswith suppliers and money issues.

The first time it happened, mother and daugh-ter showed up for the appointment, only to betold that the drug Kenisha had to take wasn’tthere.

“I was angry. We actually got there and oneof the nurses said they couldn’t give her thechemo,” Crossley said.

The drug arrived two or three days later andKenisha received a belated treatment.

The second time a drug didn’t arrive andKenisha’s chemotherapy session had to be post-poned, Crossley took matters into her ownhands.

She went to Kmart and worked out a backupplan with the pharmacist.

“I knew it was a new process here. I alsoknew that I didn’t want to take any chances,”Crossley said.

When Kenisha had a chemotherapy sessionscheduled, Kenisha’s mother would tell theKmart pharmacist what drugs she would be get-ting. The pharmacist would let them knowwhether he had those drugs in stock, whether hehad to special order them — and whether theywere medications he could get.

They discussed with him the shipment sched-ule and the need for Crossley to let him know assoon as possible if Charlotte Kimelman was notgoing to have the medication for Kenisha.

“Being a mom, do I wait for a third time to goin — and them tell me the drug’s not there?” shesaid.

As it turned out, she never had to use thebackup plan.

“But I knew I had this avenue in the eventthat it did happen,” she said.

Crossley said she knew other patients who didsuffer delays in getting their medications.

She contrasted that to Kenisha’s experience inMiami and Puerto Rico, where Kenisha neverhad any problem with medication shortages.

Through it all, Kenisha remained optimistic.“Kenisha would say, ‘Mommy, It’s just anoth-

er bump in the road. We’ll get through thisone,’” Crossley said.

The endIn late December 2006, Kenisha’s condition

had worsened, and the decision was made tostop the chemotherapy.

“It was not working,” Crossley said.Doctors prescribed medication to dull

Kenisha’s pain.On a Sunday night in late February, the pain

became excrutiating and Kenisha broke out incold sweats. She was unable to move.

Crossley said that Kenisha looked at her andsaid: “Mommy, it’s time to go.”

She called an ambulance to take Kenisha toSchneider Hospital.

By Tuesday night, Kenisha’s body was shut-

ting down. It was the last day she spoke to any-one, Crossley said.

“She woke up that night around 9 p.m.Everybody was elated when she woke up —with this energy and spunk.

“We spoke to her, kissed her up, and justenjoyed the time we had with her.”

Then Kenisha slipped into a deep sleep.On Wednesday morning — Feb. 28, 2007 —

Kenisha’s breathing slowed and becamelabored. Her family gathered around her bed-side.

“There was a single teardrop in her eye,”Crossley said.

She bent over and kissed her daughter.Kenisha died peacefully, surrounded by those

she loved.“It was just a single teardrop in the eye,”

Crossley said. “That was her way of saying goodbye.”

KENISHACONTINUED FROM PAGE 14

The secondtime a drugdidn’t arriveand Kenisha’schemotherapysession had tobe postponed,Avon Crossleytook mattersinto her ownhands.

She went toKmart andworked out abackup planwith thepharmacist.

“I knew it wasa new processhere. I alsoknew that Ididn’t want totake anychances,”Crossley said.

David Cannonier, Kenisha Crossley’s uncle, gave her this message and photo for her scrapbook.



Charlotte Kimelman Cancer Institute at Schneider Regional Medical Center

How The Daily News did this investigation

Special Investigative Report Team

OriginDaily News reporters Joy Blackburn and

Tim Fields spent six months gathering theinformation for these stories. Theirresearch began in February 2008 andcontinued until the night before publication.

Their investigation began when theystarted to check out word on the streetthat cancer patients had died because thenew Charlotte Kimelman Cancer Institutedid not get chemotherapy drugs on time ordid not keep the radiation machine up andrunning consistently.

Health care providers are bound byfederal law protecting patients’ privacy, sothe reporters could not take that path toidentify the patients. Instead, they startingcombing through a year’s worth of DailyNews obituaries.

In the long process of reporting, theycame across information that led them inother, surprising directions and required yetmore questioning of dozens of people andpouring over military documents.

These are the tools they used:

DocumentsDocuments obtained and used for this

project are available to the public. They are:• Articles of Incorporation• Audited financial reports• Hospital board meeting minutes• Hospital board reports• U.S. District Court documents• Employment contracts• Internet sites

• Job applications• Meeting minutes• Military court documents• Notices of Personnel Action• Obituaries• Property records• Resumes• Stipend agreements• Telephone directories• Uniform Code of Military Justice• U.S. Census economical data• Virgin Islands Code• Voter rolls

Document locationsThe documents are in the files of these

government agencies• Schneider Regional Medical Center• U.S. Navy Judge Advocate General’s

Corps• U.S. Navy Personnel Command.• Broward County, Fla., Supervisor of

Elections.• U.S. Census Bureau.• V.I. Elections System offices.• Office of the Lieutenant Governor’s

Office, Division of Recorder of Deeds.• V.I. Office of the Lt. Governor Division of

Corporations and Trademarks.• U.S. District Court of St. Thomas-St.

John.

InterviewsThe Daily News reporters interviewed:• Renee Adams, former administrative

director at Charlotte Kimelman CancerInstitute.

• Edward Aribisala, vice-president ofoncology services at Schneider RegionalMedical Center and administrator ofCharlotte Kimelman Cancer Institute.

• Dr. Rabin Bachan, medical oncologist atCharlotte Kimelman Cancer Institute.

• Amos Carty Jr., president and chiefexecutive officer of Schneider RegionalMedical Center.

• Mary Cooney, Public Services Director atBroward County, Fla., Supervisor ofElections

• Grace Cordial, historical resourcescoordinator for the Beaufort CountyLibrary, Beaufort, S.C.

• Avon Crossley, mother of cancer patientKenisha Crossley.

• Dr. Stan Gerson, director of the IrelandCancer Center of University Hospital’sCase Medical Center in Cleveland, Ohio.

• Dr. Julie Gralow, director of breastmedical oncology at the University ofWashington and the Fred HutchinsonCancer Research Center in Seattle, Wash.

• Kenneth Hermon Jr., director of V.I.Division of Personnel.

• Beverly Chongasing, Schneider Hospitalboard member and former chairman.

• Francis Jackson Jr., Schneider Hospitalboard member.

• Natalie Thomas, Schneider Regionalboard member.

• Pastor Ray Joseph, former SchneiderRegional board member.

• Steve Russell, legal counsel to theSchneider Regional board.

• Dr. Shirnett Williamson, radiation

oncologist at Charlotte Kimelman CancerInstitute.

• Jennifer Zeldis, spokeswomen for U.S.Navy Judge Advocate General’s Corps,Washington D.C.

• U.S. Navy JAG officers and civilianpersonnel in Washington, D.C.

• U.S. Navy and Marine public affairsofficers and staff in Washington, D.C.

• Public affairs officers and staff at theU.S. Marine Corps Recruit Depot ParrisIsland, S.C., and at Naval WeaponsStation in Charleston, S.C.

• Public affairs officers and staff at U.S.Navy Personnel Command, Millington,Tenn.

• Staff at National Personnel RecordsCenter, St. Louis, Mo.

• Staff at the Beaufort Gazette, Beaufort,S.C.

• Cancer patients treated at KimelmanInstitute.

• Families of deceased patients treated atKimelman Cancer Institute.

Attempted contactsThe following individuals either refused

to be interviewed or did not respond tointerview requests made via telephone orby express delivery to their home andoffice.• June Adams, Schneider board chairman.• Rodney E. Miller Sr., former Schneider

CEO. • Sam Topp, former Schneider Regional

board member and current hospitalspokesman.

ReportersJoy Blackburn, 774-8772 ext. 303 or [email protected]

Tim Fields, 774-8772 ext. 364 or [email protected]

EditorsJ. Lowe Davis, project editor

Jason Robbins, executive editor

With additional support and assistance from the staff of The Virgin Islands Daily News.

Photos and GraphicsSean McCoy

Copy EditorsJames AllisonCurtis Walcott

Amos Carty Jr.Sam Topp

ONE DOLLAR www.virginislandsdailynews.com

The Virgin Islands


MONDAY, DECEMBER 29, 2008 78th year, No. 21333

Hospital secretsSPECIAL INVESTIGATIVE REPORT


Schneider Regional Medical Centerhired convicted criminals to manage the money.

Now they are charged with stealing it.

TODAY: The criminal records and the hush-hush agreements Pages 2-7

Secret money, secret meetings,

secret deals, secret pastsPeter Najawicz Rodney Miller Sr.

As both general counsel and chiefoperating officer, Amos Carty Jr.gave the deals and excesses a facade of legitimacy

Sam Topp’s contradictory swornstatements raise questions about

how much the board knew and how much it is to blame


The Virgin Islands criminal charges against

former Schneider Regional Medical Centerexecutives Rodney Miller Sr., 36, and Peter

Najawicz, 41, are only the latest in a history of crim-inal charges against them — charges for crimes towhich they pleaded guilty elsewhere.

Miller, who was chief executive officer from2002 to 2007, and Najawicz, chief financial officerfrom 2004 to 2008, did not disclose their criminalrecords when they sought employment at the hospi-t a l .

Their earlier crimes bear similarities to theiractions at the hospital that have cost them their jobsand cast them as defendants in V.I. Superior Courtfacing dozens of counts of fraud, embezzlement andtheft from the hospital.

The Daily News reported July 28 that whenMiller was in the Navy in the early 1990s, he wascourt-martialed and convicted of larceny and falsi-fying documents, was sentenced to the brig andforced to leave the military with a bad conduct dis-c h a r g e .

Since July, The Daily News’ ongoing researchhas uncovered another set of criminal acts thatMiller committed before the thefts that put him inthe brig.

The newspaper also has found that Najawicz,whose job at the hospital put him in charge of itsmoney, has convictions for fraud and embezzlingfrom a previous employer.

Peter Ray NajawiczThe year was 1986 and it was Christmas season

in Portage, Mich. Najawicz, who was 19 at the time,worked as a sales clerk at MC Sporting Goods.

On Dec. 3 that year, an employee went to thestore manager and confided some disturbing news:Najawicz and several other employees were stealingfrom the store, according to a Portage PoliceDepartment report.

The employee told the manager that he lived in afraternity house with Najawicz and three other storeemployees. He said that Najawicz and the otherswere bragging about stealing sunglasses from thestore and were selling the stolen mer-chandise to fellow students on campus,

according to the police report.The employee told the manager that “along with

taking the sunglasses from the business, the subjectshad also taken hats and gloves and they were con-spiring to take skis from the business,” the policereport states.

Four other employees soon approached the man-ager with a similar story: The store was being“ripped off,” the police report states.

Store inventory records showed that 35 pairs ofRay-Ban sunglasses were missing and unaccountedfor, according to the report.

On Dec. 13, 1986, store officials questionedNajawicz and his three friends.

All confessed to stealing merchandise, accordingto the police report.

Najawicz admitted to stealing six pairs of design-er Ray-Ban sunglasses, the report states.

In a written statement to store managers,Najawicz “indicates that he realizes that his actionswere unlawful and against the company policy and

he agreed to return all the property,” the policereport states.

Five pairs of sunglasses that Najawicz stole hada combined value of $355, according to the report.He returned them and later returned a sixth pair,according to the report. The other three employeesalso returned sunglasses.

The store manager told investigators, however,that he was hearing rumors that “Peter Najawiczmay still have the other 14 pairs of sunglasses ormay have sold them by this time,” the report states.

In January 1987, Najawicz showed up at thePortage Police Department and the investigator readhim his rights. The investigator asked Najawicz ifhe took the sunglasses without paying for them.

“Yes, I did,” Najawicz said, according to thepolice report.

He told the investigator that he took them to giveas gifts and to sell to other students. He said he hadnot stolen anything else from the store, the reports h o w s .

Six months later, in June 1987, a Michigan courtfound Najawicz guilty of one count of misdemeanore m b e z z l e m e n t .

Three years later, Najawicz was in trouble again— and again, it was for stealing.

In March 1989, when Najawicz was 22, he wasarrested in Michigan on a charge of committingretail fraud.

According to a Kalamazoo County Sheriff’sDepartment report, Najawicz went to a Jewel Oscostore on March 13, 1989, and asked a store clerk toopen a locked display case that held expensive per-fumes and colognes.

Najawicz chose a bottle of Halston.Although the store policy was that customers had

to pay immediately at the cosmetics counter for any-thing from the locked case, Najawicz told the clerkthat he had only one check and needed to buy gro-ceries, too. He persuaded the clerk to let him takethe bottle with him and pay for it at the grocerycheck-out register, according to the sheriff’s officer e p o r t .

The clerk let him go ahead — but then alerted thestore’s security department.

A loss-prevention officer trailed Najawicz

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The Virgin Islands

Daily News© 2008 Daily News Publishing Co.

Hospital Secrets Monday, December 29, 2008, The Daily News2

Their earlier crimes bear similarities to their actions at the hospitalthat have cost them their jobs and cast them

as defendants in V.I. Superior Court facing multiple counts of fraud, embezzlement and theft from the hospital.

Virgin Islands Police Department

Police booking photo of Peter Najawicz, formerSchneider Hospital chief financial officer, at hisarrest on St. Thomas in October.

See SECRET PASTS, next page

Secret pastsFormer Schneider Regional Hospital officials had criminal records

Hospital Secrets

through the store as he shopped, and the guard toldauthorities she watched as he picked up a box ofMennen Skin Bracer, valued at $2.20. She toldauthorities that Najawicz removed the cheapercologne from the box and placed the bottle ofHalston, valued at $20.49, into the Mennen box,according to the sheriff’s office report.

The security officer told police she then watchedNajawicz pay for the groceries, including thecologne, for which he paid the lower price listed onthe Mennen box.

After Najawicz left the store, the store securityofficer confronted him and called the sheriff’sdepartment. According to the report, Najawiczadmitted to the sheriff’s deputy that he had switchedthe bottles of cologne and paid the lower price forthe more expensive cologne.

The officer took Najawicz to the station andissued him a citation.

On April 3, 1989, Najawicz pleaded guilty tomisdemeanor second-degree retail fraud, accordingto official records from the state of Michigan.

Najawicz also has drunken driving on his record. On May 26, 2000, four years before he became

one of the top three executives at SchneiderHospital, Najawicz was stopped and arrested inWheaton, Ill., a suburb of Chicago. He had a 0.126blood alcohol level — one and a half times the legallimit — according to court records.

At the time, Najawicz, a certified public account,was an executive for a health care network thatincluded a hospital and health centers. He was divi-sion comptroller for the company, Central DuPageHealth. In 2004, Najawicz wrote on his applicationfor employment at Schneider Hospital that he wasleaving DuPage because of “career growth, lack of.”

In August 2000, when Najawicz went to court toface the drunken driving charges, he pleaded guiltyto driving under the influence, and the judge dis-missed a second charge of driving with a blood-alcohol level higher than 0.08, according to recordsfrom the Clerk of the Circuit Court in DuPageC o u n t y .

Najawicz was sentenced to a year in a court-mon-itored program, after which the charge was reduced,meaning the DUI remains on his record, but it is notconsidered a conviction.

He also pleaded guilty to a third charge connect-ed to the DUI arrest: a traffic ticket for improperlane usage.

Najawicz now faces 54 counts in the VirginIslands including fraud, embezzlement, grand lar-ceny and conspiracy charges. His charges include10 counts of violating the Criminally Influencedand Corrupt Organizations Act.

He has pleaded not guilty to the charges.Najawicz would not comment for this story and

referred all questions to Robert King, his attorney.King would not comment when The Daily Newsasked him about Najawicz’s record.

Rodney Earl Miller Sr.

Former Schneider Regional CEO Miller alsohad run-ins with the law — long before his arreststhis year in the Virgin Islands and even before hisSeptember 1995 court-martial and bad conductdischarge from the Navy.

In 1994, a magistrate in Beaufort County, S.C.,issued five arrest warrants for Miller, charginghim with five counts of writing fraudulent checks,according to records from the Beaufort CountySheriff’s Office.

According to the warrants, Miller was accusedof writing the following bad checks to a Bi-LoFood Store:

• $27.84 to the store on June 8, 1993.• $22.09 to the store on July 29, 1993.• $29.55 to the store on Aug 3, 1993.• $26.56 to the store on Aug. 8, 1993.• $31.06 to the store on Aug. 15, 1993.Miller, who was 21 at the time, was a dental tech-

nician 3rd class assigned to the Naval Dental Centerat the Marine Corps Recruit Depot at Parris Island,S.C., when the warrrants were issued in January1 9 9 4 .

He was arrested on the warrants on March 22,1994. The Sheriff’s Office issued him citations andbooked him at the Beaufort County Detention Center,according to sheriff’s office reports.

Records from the Beaufort Magistrate Court showthat Miller made restitution for the bad checks andpaid court costs, and the charges were dismissed. Thewarrants show up as arrests on Miller’s criminalrecord but are not considered convictions.

That case was disposed on July 13, 1994.Less than five months later, Miller stole a fellow

serviceman’s credit cards, went on a shopping spreeand charged $1,149 worth of merchandise over aperiod of days in December 1994, according torecords The Daily News obtained from the NavyJudge Advocate General’s Corps.

The Navy charged Miller in May 1995 with ninecounts of larceny and two counts of attempted larce-

ny in that case and ordered him to undergo a generalcourt-martial. The Navy later added another chargeagainst Miller after he tried to avoid prosecution byconcocting an alibi for himself, falsifying documentsand involving other sailors in the plot.

In September 1995, Miller pleaded guilty to allnine of the larceny charges, one of the attempted lar-ceny charges and to the charge of violating the gen-eral article of the Uniform Code of Military Justice byobstructing justice, according to court documentsfrom Navy JAG.

He was sentenced to time in the brig, to forfeit partof his pay and to a bad-conduct discharge.

He was released from the brig in May 1996.Miller’s case went through an automatic appeal to theU.S. Navy-Marine Corps Court of Criminal Appeals,which upheld the original court’s findings.

He then appealed to the U.S. Court of Appeals forthe Armed Services, which declined to hear his case.In April 2000, the bad conduct discharge was execut-ed — and placed permanently in his military record.

Miller took the helm at Schneider Hospital twoyears later. He resigned the CEO position there inNovember 2007 to take a position in Florida. He leftthat job two days after The Daily News published aspecial investigative report, “Salaries First, PatientsLater.”

Frank Sacco, the chief executive officer ofMemorial Healthcare System in Hollywood, Fla.,said that after reading the Daily News story, hospitalexecutives were shocked.

“We confronted him and he opted to quit,” Saccos a i d .

In August, prosecutors accused him of makingfraudulent claims on the government by failing to dis-close his bad-conduct discharge on his V.I. govern-ment job application in May 2002.

In October, he was arrested again and standsaccused of 68 counts, including charges of conspira-cy, fraud, embezzlement, larceny and violating theV.I. Criminally Influenced and Corrupt Organiza-tions Act for crimes prosecutors contend he commit-ted during his tenure at the hospital.

He has pleaded not guilty to those charges.Miller’s attorneys, William Glore and Charles

Grant, have not responded to Daily News telephonemessages seeking their comments for this story.Miller’s home telephone number in Florida has beend i s c o n n e c t e d .

— Brian Hudson in Wheaton, Ill., contributed to

this report. Contact Joy Blackburn at 774-8772 ext.

303 or e-mail [email protected]. Contact

Tim Fields at 774-8772 ext. 364 or e-mail

t f i e l d s @ d a i l y n e w s . v i .

Hospital SecretsThe Daily News, Monday, December 29, 2008 3

SECRET PASTSCONTINUED FROM PAGE 2


Police booking photo of Rodney Miller Sr., formerSchneider Hospital chief executive officer, at hisarrest on St. Thomas in October.

Who’s WhoSchneider Regional Medical Center• Interim CEO — Elizabeth Harris• Interim CFO — Eugene Welsh• Chief Operating Officer

— Angela Rennalls-Atkinson• Public information officer

— Sam Topp

Territorial Hospital Board• Chairman — Carmelo Rivera,

St. Croix• Vice Chair — Lynn Millin

Maduro, St. Thomas-St. John,also the V.I. Property andProcurement commissioner

• Treasurer — Debra Gottlieb, ofSt. Thomas-St. John, also thedirector of the V.I. Office ofManagement and Budget

• Claudette Watson Anderson,V.I. Finance commissioner

• Wallace Phaire, St. Croix• Dr. Michelle Berkeley, St. Croix• Faustina Richardson, St. Croix • Frances Molloy, St. Croix• Cornel Williams,

St. Thomas-St. John• Aldria Harley Wade, St.

Thomas-St. John• Dr. Murli Daswani, St. Thomas-

St. John• Imelda Dizon, St. Croix• Maria Tankenson Hodge, St.

Thomas-St. John• Miles Stair, St. Thomas-St. John

Schneider Regional Medical CenterGoverning Board• Chairman — Cornel Williams*• Maria Tankenson Hodge*• Judith Richardson*• Vincent Samuel*• Miles Stair*• Mulchand Alwani • Aldria Harley-Wade • Dr. Murli Daswani

* New board members who weresworn in Oct. 8, 2008.

Previous Schneider Board• Chairman — June Adams**• Beverly Chongasing**• Francis Jackson Jr.**• Natalie Thomas**• Doradean Williams**• Mulchand Alwani• Aldria Harley-Wade • Dr. Murli Daswani

** Members who resigned July 31, 2008, at the governor’s request

Additional board membersbetween 2002-2007• Horace Brooks• Yvonne Francis• Ray Joseph• Dr. Leighmin Lu• Dr. Secundina Mercado• Sam Topp

In 1994, a magistrate in Beaufort County, S.C., issued five arrest warrants for Rodney Miller, charging him

with five counts of writing fraudulent checks.

Hospital Secrets

4 Hospital Secrets Monday, December 29, 2008, The Daily News

By JOY BLACKBURNDaily News Staff

The hiring of two top-level executives at

Schneider Regional Medical Center who hadcriminal records has raised questions about the

territory’s personnel policies and practices. What has come to light is: • The V.I. government does not do criminal back-

ground checks on all job candidates. • A criminal record does not automatically dis-

qualify a job candidate from being hired by the V.I.government, even for top-level management posi-t i o n s .

• The territory’s public hospitals are not requiredto use the policies and practices of the V.I. PersonnelO f f i c e .

The government has a plan for making changes, butno way to put it into effect.

The V.I. Division of Personnel and the territory’sPolice and Justice departments have worked togetherto develop a new policy that would require criminalbackground checks on everyone about to be hired towork for the government.

The only hitch is money: The government can’tafford to do the checks on everyone. A criminal recordcheck on an individual can range from $35 to $40.

“It’s just a financial question,” V.I. Division ofPersonnel director Kenneth Hermon Jr. said. “Rightnow, all departments are cash-strapped.”

Justice, Police and the V.I. Fire Service alreadyrequire criminal background checks on employees,but the new policy would apply to all departments,Hermon said.

“We want to roll it out government-wide,” Hermons a i d .

Under the new policy, when a candidate is about tobe hired, Personnel will contact the PoliceDepartment, which will run the job candidate’s namethrough NCIC, the National Crime InformationCenter. It is a computerized index of criminal justiceinformation that the FBI maintains and makes avail-able to criminal justice agencies across the country.

The new policy was finalized in the months

after The Daily News published “Salaries First,Patients Later” in July, exposing former SchneiderRegional Chief Executive Officer RodneyMiller’s court-martial while he was in the Navy.Miller did time in the brig and received a bad con-duct discharge for stealing another sailor’s creditcards, going on a shopping spree with them andthen falsifying documents to give himself an alibi.

He did not disclose any of that on his V.I. jobapplication, nor did he disclose other arrests andcharges that The Daily News has uncovered andreported in today’s investigative report.

In ongoing research, The Daily News also hasfound that former Schneider Regional Chief FinancialOfficer Peter Najawicz has a criminal record of retailfraud, embezzlement and drunken driving, none ofwhich he disclosed when he applied for the job here.

Criminal justice agencies across the country,including the branches of the military, use the NCICand submit information to its database, said StephenFischer Jr., chief of multimedia productions for theFBI’s Criminal Justice Information Services Division.However, participation is voluntary and the burden ison law-enforcement agencies to submit data to NCIC.

Hermon said that V.I. officials are considering pos-sible options, such as requiring the job candidate topay for the criminal background check — and thenhaving the hiring department or agency reimburse thecandidate if he or she is hired.

Regardless what the background check turns up,the candidate still could be hired.

Hermon said the V.I. government does not have apolicy that automatically disqualifies a job candidatebecause of a previous conviction, but the pre-employ-ment background checks would allow agency headsto make “informed decisions,” he said.

However, there is no assurance that every job can-didate will be checked.

The Personnel Department’s new policy does notapply to Schneider Regional Medical Center or toLuis Hospital on St. Croix because the hospitals havesemi-autonomous status. That means that althoughtheir payrolls and many other expenses are paid by thepublic through taxes and subsidies, the hospitals have

the authority, by law, to do their own hiring and settheir own personnel policies.

Hermon said the Personnel Office hopes the hospi-tals and other semi-autonomous and autonomous gov-ernment agencies will see the benefit of the new poli-cy.

“We always might suggest that they follow ourlead,” Hermon said.

When the Personnel Office’s new policy goes intoeffect, the V.I. government will become part of anationwide trend.

Alastair Watson, director of Employer Services forFirst Advantage, a California-based company thatprovides risk mitigation and a variety of other servicesfor businesses, said that he has seen a trend towardU.S. employers conducting criminal backgroundchecks on more prospective hires.

The Society for Human Resources Managementreported in 2005 that 96 percent of U.S. employersalways conduct reference checks and some sort ofbackground check on candidates for executive andupper management positions, he said.

“Since the majority of employers are screening jobcandidates in one form or another, what we’ve seenhappen over the last few years is their ‘widening thenet’ and including additional workers in their pro-grams,” he said.

Employers should do a higher level of pre-employ-ment screening for “positions of trust,” personnel pro-fessionals said.

Judy Miller, managing director of the BusinessIntelligence and Investigations Division at Kroll, aFlorida-based risk consulting company, said that forhigh-level executives, due diligence should be done incivil records, regulatory records and criminal records,as well as resume vetting and possibly “human sourceinquiries, to check on a person’s reputation.”

For positions of trust, a check for criminal convic-tions simply may not be enough.

“You can have a very troubled ethical history that’snot apparent by solely looking at felony convictions,”she said. “I think what it comes down to is: The high-er the position of trust, the more that’s at risk andtherefore the more due diligence is required.”

Criminal charges against former hospital officialsThe V.I. Attorney General’s Office has filed a 144-count charging document naming four former Schneider Regional Medical

Center officials under the territory’s anti-racketeering statute. In some instances, two or three defendants are charged under asingle count. All four have pleaded not guilty to the charges, which are:

Rodney Miller Sr.• Obtaining money by false pretense, 15 counts.• Embezzlement or falsification of public

accounts, 15 counts.• Violating the Criminally Influenced and

Corrupt Organizations Act, 12 counts.• Embezzlement by fiduciaries, 9 counts.• Conspiracy, 7 counts.• Embezzlement by public and private

officers, 5 counts.• Grand larceny, 3 counts.• Conversion of government property, 2 counts.

Note: In a separate criminal case, Millerfaces the charge of making fraudulent claimsupon the government, a crime prosecutorscontend Miller committed when he lied on hisV.I. government job application to conceal hisbad conduct discharge from the U.S. Navy.

Amos Carty Jr.• Conspiracy, 7 counts.• Violating the Criminally Influenced and

Corrupt Organizations Act, 7 counts.• Obtaining money by false pretense, 5 counts.• Embezzlement by fiduciaries, 5 counts.• Embezzlement by public and private

officers, 4 counts.• Grand larceny, 3 counts.• Embezzlement or falsification of public

accounts, 2 counts.• Aiding and abetting embezzlement or

falsification of public accounts, 1 count.

Peter Najawicz• Obtaining money by false pretense, 8

counts.• Embezzlement or falsification of public

accounts, 3 counts.• Embezzlement by fiduciaries, 12 counts.• Conversion of government property, 1 count.• Grand larceny, 4 counts.• Conspiracy, 3 counts.• Violating the Criminally Influenced and

Corrupt Organizations Act, 10 counts.• Certifying officer; accountability, 12 counts.• Conflict of interest, 1 count.

June Adams• Aiding or abetting embezzlement or

falsification of public accounts, 3 counts.• Embezzlement by public and private

officers, 2 counts.• Perjury, 3 counts.• Conflict of interest, 1 count.

Source: Charging document filed in V.I. Superior Court by the V.I. Attorney General’s Office

In V.I., government workers can easily hide criminal records

The higher the position of trust, the more that’s at risk andtherefore the more due diligence is required.”

— Judy Miller, managing director of the Business Intelligence and Investigations Divisionof Kroll, a Florida-based risk consulting company

Timeline 1999 • May 14 — Territory’s hospitalsbecome semi-autonomous undernew law allowing them to collectand manage their own revenue butstill receive government support.

2 0 0 2• May 13 — Rodney Miller Sr., 29,becomes Schneider Hospital chiefexecutive officer.

• Nov. 27 — Amos Carty Jr., takeson dual role of chief operatingofficer and general counsel.

2 0 0 4• April 19 — Peter Najawicz, 37,becomes Schneider Hospital chieffinancial officer.

2 0 0 5• May 9 — Schneider Hospital,Myrah Keating Smith CommunityHealth Center on St. John andCharlotte Kimelman CancerInstitute collectively becomeSchneider Regional Medical Center.

2 0 0 6• July 26 — Charlotte KimelmanCancer Institute opens.• D e c e m b e r — Schneider Regionalshows $35.1 million operating loss.Government contributions reduceloss to $6.5 million.

2 0 0 7• May 14 — Kimelman Institutestaff tell Chief Executive OfficerRodney Miller Sr. that the cancercenter is hurting for cash andhospital’s failure to pay its bills isendangering cancer patients.

• May 14 — Schneider Hospitalboard gives Miller the highest paypackage ever awarded to a publicofficial in the territory: $536,000 insalary and bonuses annually,$222,700 in tax-deferredcompensation plus luxury perks.

• May 17 — Miller instructsNajawicz to transfer $966,456.45to his personal Pentagon FederalCredit Union account.

• Sept. 20 — CEO Rodney MillerSr. resigns, effective Nov. 3.

• Oct. 24 — The board adopts a2008 budget projecting overall lossof $12.9 million.

• Nov. 3 — Amos Carty Jr. takesover as CEO.

• Nov. 14 — Schneider Regional’s2007 fiscal year report shows$41.3 million operating loss and anoverall loss of $7.5 million.

2 0 0 8• July 28 — The Daily Newspublishes “Salaries First, PatientsLater.”

• July 29 — V.I. Inspector Generaland U.S. Department of the InteriorInspector General release scathingjoint audit report on hospital.

• July 31 — Gov. John deJonghJr. requests and receives theresignations of five SchneiderRegional board members: JuneAdams, Beverly Chongasing,Francis Jackson Jr., NatalieThomas and Doradean Williams.

See TIMELINE, next page

Hospital Secrets

5Hospital SecretsThe Daily News, Monday, December 29, 2008


As the attorney entrusted to look out for the

interests of Schneider Regional MedicalCenter, Amos Carty Jr. used that position

of power and trust to operate a fraud and embez-zlement scheme to steal large sums of moneyfrom the cash-strapped public hospital, accordingto filings in a criminal case against him.

The Daily News has reported, and the V.I.Justice Department is charging, that Carty andother executives at the hospital secretly divertedmillions of dollars of the hospital’s money intotheir own pockets over a period of five years.

Carty, 43, who is a past president of the V.I.Bar Association and whose political future onceappeared promising — he often was mentionedas a possible prospect for governor — rosequickly at the hospital, first as its attorney, thenas chief operating officer and general counseland finally as chief executive officer.

That came to an end after The Daily News onJuly 28 published a special investigative report,“Salaries First, Patients Later” detailing Cartyand other top executives’ self-dealing and thelavish pay and perks they arranged for one anoth-er with hospital funds.

The Daily News report showed that the hospitalneeded that money for patient care, particularly atthe Charlotte Kimelman Cancer Institute, wherecancer patients had to do without urgently neededchemotherapy and radiation treatments becausecash shortages delayed payments for supplies.

On July 30, The Daily News published a jointaudit report, which the V.I. and U.S. Departmentof Interior Inspectors General released the nightbefore, that shed further light on the mismanage-ment at the hospital and misuse of hospitalm o n e y .

On Aug. 8, the territorial hospital board fol-lowed Gov. John deJongh Jr.’s instructions andsuspended Carty and Chief Financial OfficerPeter Najawicz, 41. The board fired them inSeptember. Rodney Miller Sr., 36, the CEO whopreceded Carty, had left the territory inNovember 2007 for a hospital job in Florida,which he quit two days after The Daily Newsreport was published.

Carty, Najawicz and Miller were arrested Oct.7 on multiple charges in a criminal case that theV.I. Attorney General’s Office has filed underthe territory’s anti-racketeering statute.

Prosecutors organized the case against thethree, plus former hospital board chair JuneAdams, into a 144-count charging documentfiled in V.I. Superior Court along with an affi-davit from a V.I. Inspector’s General’s Officespecial investigator.

The affidavit provides supporting details for34 counts against Carty, including multiplecharges of conspiracy, embezzlement, grand lar-ceny, obtaining money by false pretenses andviolating the V.I. Criminally Influenced andCorrupt Organizations Act, or CICO.

C I C O targets sophisticated criminal activity

that may involve the illegal manipulation oflegitimate business and other enterprises.

Carty and the other three defendants havepleaded not guilty.

Miller, Najawicz and Carty worked together,using various devices to give the appearance oflegitimacy to their scheme, according to thep r o s e c u t i o n .

As the CEO, Miller initiated the illegalactions; as the hospital’s attorney, Carty gave theactions the seal of legal approval; and as the hos-pital’s CFO, Najawicz manipulated and steeredthe money, according to details in the affidavitsupporting criminal charges against them.

Carty started working at the hospital in 1999,but a few months after new CEO Miller arrivedin 2002, Carty began to play a much bigger role.Miller promoted Carty to chief operating officerand had Carty keep all the powers and duties ofgeneral counsel.

As general counsel, Carty remained responsi-ble for providing legal advice, guidance and con-sultation to the hospital and reviewing and autho-rizing contracts for legal sufficiency. The hospi-tal board “relied on Carty to prepare and reviewcontracts, to give legal advice, and to advocatethe interest of the RLSH. Carty was well-liked,respected and trusted by the members of theRLSH Board,” V.I. Inspector General’s Officespecial investigator Nicholas Peru wrote in anaffidavit supporting the criminal charges.

In November 2007, after Miller left forFlorida, the hospital board promoted Carty toCEO and hung big congratulatory banners dis-playing his portrait throughout the hospital.

Carty’s salary was $80,000 a year until hebecame CEO in November 2007, when his salaryincreased to $150,000, according to his NOPA— the V.I. government’s Notice of Personnel

Action form, which the V.I. Division ofPersonnel uses to document every change in agovernment employee’s pay and job status.

‘Unlawful and unauthorized’ payments

The NOPA was not a true reflection of Carty’spay.

Between December 2002 and November 2007,Carty received more than $600,000 from hospitaloperating accounts over and above the salaryamounts on his NOPA. Those were “unlawful andunauthorized” stipends, bonuses and perks, accord-ing to the criminal charges. Miller awarded Cartythose extra payments and Najawicz approved anddisbursed the payments — a cycle the three usedcontinually to secretly divert large sums to oneanother, according to court files.

According to the affidavit supporting the charges,Carty’s payments, over and above the $80,000 on hisNOPA, included:

• $40,000 annually — This was a $40,000 annu-al “stipend,” which Miller gave Carty and docu-mented in an agreement that Miller and Carty signed.The agreement was effective Dec. 1, 2002, and wasset up to be paid $1,538.46 bi-weekly. The affidavitstates that Miller wrote to Banco Popular to directpayment of this money to Carty from a hospital oper-ating account.

• An additional $7,799 annually — This was a$7,799 raise over the $40,000 “stipend,” making thetotal $47,799, paid as $1,838.46 bi-weekly,“stipend” as shown in an amendment to the $40,000agreement. The amendment to the original agree-ment was signed by Miller on Feb. 19, 2003, and byCarty on Feb. 12, 2004, according to the affidavit. Acopy of the agreement, which The Daily Newsacquired under the V.I. Open Records Act earlier thisyear, shows a typewritten date of “02/12/04” byCarty’s signature, while the “2/19/03” typewrittendate by Miller’s signature has “04” handwritten overthe year. The amendment does not show a separateeffective date.

The $47,799 was paid directly from hospital oper-ating accounts, while the salary authorized on hisNOPA was paid out by the V.I. Finance Department,which issues all government employee paychecks.

• $10,000 — This was a “bonus” Miller awardedCarty in a May 10, 2005, letter.

• $109,600 annually — This was $109,600 overCarty’s $80,000 on his NOPA. Miller documentedthe amount in a Nov. 7, 2005, letter to Carty, but theydid not disclose it to the V.I. Personnel Office, mean-ing it did not show on Carty’s NOPA. The $109,600extra was retroactive to Aug. 1, 2005, and was paidto Carty by the hospital in $4,215.38 bi-weekly pay-ments. Carty wrote a letter to Najawicz instructinghim into which of Carty’s personal bank accountsthe $4,215.38 extra should be deposited every twoweeks, according to court files. At the same time,Carty’s $80,000 on his NOPA was paid by the V.I.Finance Department.

• $33,723 — This was a payment that Cartyobtained by writing a letter to Najawicz on Nov. 9,2005, requesting that Najawicz transfer $30,000 intoone of Carty’s personal accounts and $3,723 to anoth-

The Daily News has reported, and the V.I. Justice Departmentis charging, that Carty and other executives at the hospitalsecretly diverted millions of dollars of the hospital’s money

into their own pockets over a period of five years.

Profit from power


Police booking photo of Amos Carty Jr., formerSchneider Hospital chief operating officer and generalcounsel, at his arrest on St. Thomas in October.

See PROFIT FROM POWER, next page

Using others’ trust in him, former general counsel and chief operating officer AmosCarty Jr. made the money deals with Miller and Najawicz look legitimate

Timeline • Aug. 1 — DeJongh nominatesfive new members to theSchneider board: MariaTankenson Hodge, CornelWilliams, Dilsa Capdeville,Vincent Samuel, Miles Stair.DeJongh instructs the territorialhospital board to put Carty andNajawicz on paid leave pendinga full investigation.

• Aug. 5 — V.I. AttorneyGeneral seeks and receives a60-day temporary restrainingorder freezing the personalassets of Miller, Carty andN a j a w i c z .

• Aug 8 to Sept. 2 — M i l l e rempties $1.2 million from hisPentagon Federal Credit UnionAccount that was frozen bycourt order. A credit union errorallows Miller to remove themoney.

• Aug. 8 — Elizabeth Harris isnamed interim CEO forSchneider Regional. EugeneWelsh is named interim CFO.

• Aug. 20 — Judith McDonaldRichardson is named toSchneider Regional board inplace of nominee DilsaCapdeville, who has withdrawnher name.

• Aug. 22 — Miller is arrestedand charged with makingfraudulent claims upon thegovernment by failing todisclose his bad conductdischarge from the Navy in hisapplication for the SchneiderCEO job.

• Aug. 28 — Miller pleads notg u i l t y .

• Sept. 5 — Territorial boardinstructs Harris to fire Carty andlet Najawicz resign or be fired.

• Sept. 23 — V.I. SuperiorCourt Judge James Carroll IIIdenies motions by Miller andNajawicz to lift the TROfreezing their assets.

• Sept. 30 — Harris firesN a j a w i c z .

• Oct. 7 — Miller, Carty,Najawicz and former SchneiderRegional board chairman JuneAdams are arrested on criminalcharges containing 144 countsof embezzlement, conspiracyand fraud.

• Oct. 23 — Miller, Carty,Najawicz and Adams plead notguilty.

• Nov. 25 — Judge Carrollfinds Miller in contempt of courtfor removing the money fromthe frozen Pentagon Federalaccount and orders him totransfer $515,000 into the courtregistry. Miller’s attorneys, whoare not found in contempt, areordered to transfer $260,000that Miller gave them asretainers into the registry.

• Dec. 11 — V.I. SupremeCourt grants Miller and hisattorneys a partial, temporarystay of the order to depositmoney into the court registry.

Hospital Secrets

Hospital Secrets Monday, December 29, 2008, The Daily News6

er of his personal accounts, according to court files.Carty said in the letter to Najawicz that the transferwas in accordance with a Nov. 7 authorization letterfrom Miller. The special investigator disputed that,saying in his affidavit that the $33,723 “was not dueto him even if the increase in salary was legiti-mate.”

• $28,440 annually — This was an annual“incentive bonus” on top of the $109,600 extra thatCarty got, effective Aug. 1, 2005.

• $10,768.80 — This was a debt, for an undis-closed purpose, that Carty owed the hospital, whichNajawicz “wrote off” with Miller’s permission inFebruary 2006. Najawicz’s explanation for thewrite-off was that collection was “unlikely.”

• $76,516.31 — This was money over andabove Carty’s new NOPA salary of $150,000,which he received as the new CEO. Carty took theextra money between Nov. 2, 2007, and July 29,2008, via transfers from hospital operatingaccounts directly into his personal bank account,according to the affidavit. The affidavit shows thatthe last transfer was on July 29, the day after TheDaily News exposed the extra pay schemes in“Salaries First, Patients Last.”

No taxes appear to have been withheld fromCarty’s extra payments from November 2005 toNovember 2007, according to court documents,raising the question of whether Carty compliedwith federal and territorial tax laws.

Rabbi Trust

Miller helped enrich Carty and in exchange,Carty facilitated Miller’s own lucrative benefitspackage in 2005, according to prosecutors.

Their deals were secret — the hospital board hadno knowledge of and never approved them, accord-ing to the special investigator’s affidavit about whatmembers of the board told him under oath.

One of those deals originated with a June 12,2005, meeting that Miller and Carty held privatelywith financial consultant Julito Francis. The purposeof the meeting was to discuss different types ofexecutive benefits packages for Miller.

Francis — who now is the director of finance andadministration for the V.I. Public Finance Authority— told the investigator that he first met Carty whenhe appeared as a guest on Carty’s TV show. Whileworking at the hospital, Carty hosted a nighttimetalk show on TV2, a local channel. After the show,he told Francis that he wanted Francis to meet withMiller, who was negotiating a new contract with thehospital, according to the affidavit.

After their June meeting, Francis sent Miller a let-ter dated July 1, 2005, listing benefits attractive tohighly paid executives, the affidavit states. One suchbenefit was a financial instrument called a RabbiTrust, which is used to defer income tax payments.

A Rabbi Trust is an IRS-approved device for ahighly paid employee to postpone paying incometax on a portion of his compensation. The method issimple: The employer sets up an irrevocable trustfor the employee and deposits the agreed-uponamount of money into the trust account. At anagreed-upon time, the employee is entitled to takeout the money, which then becomes taxable.

On July 18, 2005, Francis sent Carty a letter ref-erencing “Retirement and BenefitsRecommendations for Mr. Rodney Miller.”Attached to that letter was a similar letter addressedto Miller outlining the recommended benefits andlisting six items, according to the affidavit.

“Francis stated that he offered to meet with theboard or members of the board to give a presenta-tion of the proposal given to Miller” — but he wasnot invited and no such meeting ever took place, theaffidavit states.

However, Miller’s contract — which is datedMay 14, 2005 — has an attachment that repeated,verbatim, the list of benefit recommendations fromFrancis’ July 18 letter, according to Peru’s affidavit.

Carty is charged with fraudulently adding theattachment to Miller’s contract, which was neverseen by the board, according to court documents.

The Rabbi Trust in the attachment would haveplaced $125,000 every year for five years into a trustfor Miller, for a total of $625,000.

Miller, however, just used the term Rabbi Trustand actually funnelled the money into his own bankaccount, according to the special investigator.

Miller collected a total of $1.25 million under thepretense of payments into a Rabbi Trust, the affi-davit states.

That amount was twice as much as the $125,000a year that the attachment to his contract called for,the affidavit states. Members of the hospital board’scompensation committee told Peru that they “neverknew of or negotiated any Rabbi Trust,” the affi-davit states.

Peru further wrote that “each of them stated thatthey did not even know what a Rabbi Trust was.”

The 2005 contract that Carty set up for Miller alsocontained another secret benefit: a waiver ofMiller’s obligation to repay a $45,500 housingallowance “advance,” the affidavit states.

The board members said they did not know aboutany advances to Miller, or to anyone else, accordingto the affidavit.

Carty crafted a 2007 contract for Miller contain-ing a benefits package similar to those in the 2005contract — and again, Carty and Miller did notshow the benefits to the board, the affidavit states.

The board’s compensation committee memberstold the investigator they “trusted and relied onCarty as general counsel to prepare the contract,”the affidavit states. Carty’s signature appears oneach of Miller’s employment contracts, approvingthem for legal sufficiency.

Board chair June Adams, whose signature alsoappears on the contracts, told investigators that “shedid not even know what a Rabbi Trust was and onlyrecently heard of a Rabbi Trust,” Peru wrote.

“She further stated that she recalled seeing andperusing the contract document, but there was notan attachment. She was adamant that the attached‘Schedules’ were not there at the time she signed thecontract,” the affidavit states.

The criminal charges against Carty include twocounts that specifically accuse him of fraudulentlyattaching the schedule of benefits to Miller’s 2005and 2007 contracts. The charges are obtainingmoney by false pretenses and embezzling by publicand private officers. The 68 counts against Millerinclude two similar charges.

Another charge accuses Carty of fraudulentlyinserting, without the authority to do so and withoutthe board’s knowledge or consent, a clause inMiller’s 2005 contract waiving repayment of a$45,500 housing allowance “advance.” Miller andCarty also are accused of conspiracy, stemmingfrom the clause in the contract.

Carty, Miller and Najawicz operated “in a cloudof secrecy to enrich themselves by misappropriatingpublic funds for themselves without the authoriza-tion and consent of RLSH Board, without legalauthority and otherwise contrary to law,” Peru wrotein his affidavit.

Carty’s response

Henry Feuerzeig, Carty’s attorney, has told TheDaily News that Carty has done nothing illegal.

He said Carty was legally entitled to the moneyhe received via his contracts, which Feuerzeig saidwere lawful contracts executed in accordance withhospital by-laws.

In a brief interview for this report, Feuerzeigsaid Carty’s defense against the charges againsthim is contained in Carty’s response to the jointlocal-federal inspectors general audit of hospitalf i n a n c e s .

The response, Feuerzeig said, “speaks fori t s e l f . ”

In it, Carty wrote that auditors misunderstoodand mischaracterized actions taken by hospitalo f f i c i a l s .

Carty also wrote that as a semi-autonomousagency — not solely dependent on appropriationsfrom the government — Schneider Regional wasgiven the “statutory authority to manage its ownaffairs outside the purview of the Legislature.”

The territory’s hospitals have two main sourcesof revenue: government appropriations from theGeneral Fund and monies generated from the ser-vices they provide.

Carty wrote that the Legislature gave the hospi-tal board the power to “establish and maintain sep-arate cash accounts and to make disbursements topay necessary costs and obligations.”

Those accounts, Carty’s response contended, are“far different” than the accounts maintained byother agencies that rely solely on governmentappropriations. He said that the statutory jurisdic-tion of the Legislature is over the General Fund,out of which NOPA salaries are paid, and that theLegislature has no control over the hospital’s inde-pendent accounts.

Carty stated that in order to attract and retainqualified health care executives, the board, since2002, used hospital operating funds to supplementNOPA compensation for certain top executives.

Carty wrote that this method also was used topay certain doctors above their NOPA salaries.

The NOPA salary simply was not sufficient forkey positions, he said.

“As a result, the Medical Center has made abusiness judgment that to recruit and retain neededpersonnel in key senior executive and administra-tive staff positions, it will supplement a NOPA andoffer market rate compensation,” Carty wrote, andhe said that the hospital’s business judgment wasconsistent with the organizing statutes of the dis-trict board.

“It is clear that the auditors have assumed, incor-rectly, that the District Board has an obligation toreport the salary of its senior executives to theLegislature. Such an assumption is unfounded,incorrect and cannot be traced to any legal require-ment,” Carty wrote.

Miller’s 2005 contract recognized his value tothe medical center and it had to be competitive toretain Miller, Carty wrote, and in 2007, the hospi-tal needed to retain Miller for another year.

Carty cited Miller’s accomplishments as CEO.

Carty wrote that in March 2008 — five monthsafter Miller left for Florida — the board had itsattorney write to Miller about lump sum disburse-ments to him related to his 2005 and 2007 contracts.Carty also wrote that Miller had retained his ownlegal counsel and told the hospital he was willing toengage in discussions to “arrive at an appropriatereconciliation and reimbursement of any moniesthat may be due as a result of overpayment.”

Carty said that Miller had the legal authority toincrease Carty’s and Najawicz’s compensation andin 2005, Miller did that based on recommendationsfrom a consulting firm.

Carty’s own pay, Carty wrote, recognized hisdual role as COO and legal counsel.

The governor did not include Carty’s responsein the official statement about the audit.

Carty himself publicized his response, shortlyafter The Daily News published its investigativereport and the inspectors general released their auditr e p o r t .

Carty’s arguments notwithstanding, fiveSchneider Regional board members resigned at therequest of the governor, new members filled thoseseats and the territorial hospital board was revived.The new territorial board suspended Carty and itnamed an interim CEO, Elizabeth Harris, forSchneider Regional Hospital. The board instructedher to cease paying employees money in excess ofthe amounts on their NOPAs.

The new board fired Carty on Sept. 5 and firedNajawicz on Sept. 30 after he failed to decidewhether he would resign or preferred to be fired.

— Contact Joy Blackburn at 774-8772 ext. 303 or

e-mail [email protected]. Contact Tim Fields

at 774-8772 ext. 364 or e-mail [email protected].

PROFIT FROM POWERCONTINUED FROM PAGE 5

Hospital Secrets

Hospital SecretsThe Daily News, Monday, December 29, 2008 7


Former Schneider Regional Medical Center

board member Sam Topp gave two swornstatements that tell two different and contra-

dictory stories about what the board knew aboutRodney Miller’s 2005 contract and lavish benefits.

Topp’s first sworn statement was in the form of asigned affidavit that he gave Amos Carty Jr. in Julyin anticipation of a negative report from an audit ofhospital finances and management.

In that affidavit, Topp said he and other membersof the hospital board’s compensation committeeknew about, and received advice about, a RabbiTrust and other benefits for Miller and incorporatedthem into the final executed version of Miller’s 2005contract. Topp further said that he himself reviewedthe contract before it was executed.

Topp’s second statement, given under oath duringquestioning by V.I. Inspector General special inves-tigator Nicholas Peru, is the opposite of what Toppswore to in the affidavit for Carty.

Peru questioned all three members of the hospitalboard compensation committee — Topp, NatalieThomas and Francis Jackson Jr. — and their answerswere given under oath. Peru was conducting aninvestigation in preparation for the V.I. AttorneyGeneral’s filing of criminal charges against hospitalofficials.

Peru interviewed Topp, Thomas and Francisabout Miller’s 2005 contract and perks, including theRabbi Trust. Peru referred to their sworn testimonyin his own signed affidavit, which prosecutors haveincorporated into a criminal case filed Oct. 22.

Identifying himself as the affiant, Peru wrote in hisa f f i d a v i t :

“Affiant interviewed all members of theCompensation Committee on separate occasions andshowed them the May 14, 2005, Miller contract.Each of them stated that they never knew of, or nego-tiated, any Rabbi Trust. Each of them stated that theydid not even know what a Rabbi Trust was.Furthermore, the final May 14, 2005, contract was

never submitted to the board forapproval.”

Topp’s statement in the signedaffidavit he gave Carty says theopposite:

“The Compensation Committeealso received advice from an inde-pendent financial advisor, JulitoFrancis, on structuring the contract’snon-salary-related benefits, includ-ing implementation of an irrevocableRabbi Trust. The CompensationCommittee incorporated Mr.Francis’ recommendations regard-ing benefits into the final, executedversion of Mr. Miller’s contract. Ireviewed Mr. Miller’s 2005 contractbefore it was executed and conclud-ed that it reflected the CompensationCommittee’s understanding of theterms under which Mr. Miller wouldbe employed by the Medical Centerduring the contract term.”

Topp, who is the longtime host ofa local radio talk show, left the boardin 2007 and was hired by Carty ashospital spokesman at $75 an hourup to an annual limit of $75,000.Topp would not answer Daily Newsquestions about the discrepanciesbetween what he swore in his per-sonal affidavit and what he told theinvestigator under oath.

Topp told The Daily News that hebelieved that it would not be appro-priate for him to discuss the matterbecause the case most likely will be going to trial.

“I have no comment on any aspect on anythingthat is likely to be involved in this case,” Topp said.“I’m sorry, that’s just where I am.”

Assistant Attorney General Denise George-Counts also declined to comment on the discrepan-cies between Topp’s sworn statements.

“I can’t make any comments regarding how it

affects the case, the prosecution orthe investigation, which is ongo-ing,” she said.

“But I would say that the state-ments in the affidavit by Mr. Peruare clearly true. That is true. That iswhat happened.”

Like Topp, Thomas also gaveCarty an affidavit to use inresponse to the audit report. Heraffidavit, however, did not specifi-cally say that the compensationcommittee or full board knewabout and approved the RabbiTrust.

Her affidavit details at length thecommittee’s justification for giv-ing Miller a large salary increase.Her signed affidavit then says:“The Compensation Committeealso consulted with Julito Francis,a financial advisor, in connectionwith Mr. Miller’s contract.”

Julito Francis, however, told thespecial investigator he spoke onlywith Miller and Carty and nevermet with the board, Peru wrote inhis affidavit.

Thomas declined to commentfor this report.

Jackson, who was the thirdmember of the compensation com-mittee, told The Daily News thatCarty never presented him with anaffidavit to sign. He said that if hehad been presented with one, he

would not have been willing to sign it.He would not discuss the subject further, saying:

“At this point, as I understand it, I’ll be a govern-ment witness so I really feel that I need to refer youto the government attorneys. I don’t feel I should becommenting to the press while this matter is pend-ing in court at this point.”

Daily NewsFile Photo

I have nocomment on anyaspect on anythingthat is likely to beinvolved in thiscase. I’m sorry,that’s just where Ia m .

— Sam Topp, formerSchneider Regional

Medical Centerboard member and

current hospitalspokesman

Sam Topp’s two sworn versions of what happened place hospital board compensation committee members

Topp, Natalie Thomas and Francis Jackson Jr. in a questionable role as Miller’s excess payments come to light.

Who OK’d Miller’s Rabbi Trust?

G l o s s a r yTerms in today’s stories:

• Affiant — A person who swearsto an affidavit.

• Affidavit — A written declarationmade under oath or on affirmation.

• Audit — An examination andverification of the financial andaccounting records and supportingdocuments of a company or agencyof government by a professional,such as a Certified PublicAccountant, an Internal RevenueService agent or an InspectorGeneral. In the case of an audit bythe Office of the Inspector General,the scope may include managementp r a c t i c e s .

• Charging document — A formalaccusation that the Office of the V.I.Attorney General files in court tocharge a person with a seriouscrime. It states the basis for theaccusations and provides supportingdocuments such as swornstatements from investigatingofficers. The Virgin Islands criminaljustice system does not provide forindictments, which are formalaccusations of a felony issued by agrand jury. Instead, the V.I. AttorneyGeneral’s Office files a chargingdocument, which is called “aninformation.” In federal courts in theterritory, grand juries are convenedand indictments are issued.

• CICO — The Virgin IslandsCriminally Influenced and CorruptOrganizations Act, commonlyreferred to as CICO. It allows forprosecution on charges ofsophisticated criminal activity thatinvolves “the illegal manipulation oflegitimate business and othere n t e r p r i s e s . ”

• Embezzlement — The fraudulentappropriation of money or goods bysomeone entrusted with its care,but who uses it for his or her ownpurposes. Embezzlement mostoften occurs in the workplace.

• Inspector General — T h eInspector General is responsible forconducting and supervising audits,inspections and relatedinvestigations of programs andoperations of the Government of theVirgin Islands to promote economy,efficiency and effectiveness and todetect fraud, waste and abuse insuch programs and operations.

• NCIC — National CrimeInformation Center was establishedin 1967 by the FBI as a centralreference for information on criminalinvestigations. The NCIC data baseincludes individuals’ criminal historyas well as information on missingpersons, unidentified persons andviolent gang and terrorist activity. Itis available to federal, state, andlocal law enforcement and othercriminal justice agencies 24 hours aday, 365 days a year.

• NOPA — the V.I. government’sNotice of Personnel Action form,which the V.I. Personnel Office usesto document a governmentemployee’s pay and job status andtrack every change.

• Rabbi Trust — An IRS-approveddevice for a highly paid employee topostpone paying income tax on aportion of his compensation. Themethod is simple: The employersets up an irrevocable trust for theemployee and deposits the agreed-upon amount of money into thetrust account. At an agreed-upontime, the employee is entitled totake out the money, which thenbecomes taxable.

“

Hospital Secrets


ONE DOLLAR www.virginislandsdailynews.com

The Virgin Islands


TUESDAY, DECEMBER 30, 2008 78th year, No. 21334

For more than a decade, people in the Virgin Islands have

given from the heart to help build and support a cancer

treatment center in the territory.

The money poured in — gifts large and small, fundraiser rev-

enues and contributions from civic clubs all added up to nearly

$4 million.

Where did the money go? Nobody can say for sure.

Hospital executives have not produced documents that accu-

rately track the money, but they say, emphatically, that they are

certain it went to the cancer center.

The proof, they said, is that the Charlotte Kimelman Cancer

Institute has been built.

For five months, The Daily News has examined the hospital

banking records to track the money. The newspaper has found a

p a t t e r n :

• Unexplained money-movement through bank accounts.

• Opening and closing bank accounts without explanation.

• Withdrawing large amounts, totaling $2.4 million, via

electronic transfers and debit memos, without explanation.

• Co-mingling the donated funds with the hospital operating funds.


TODAY: Secret money, secret meetings Pages 2-7

Hospital Secrets

Daily NewsFile Photo

Part 2

Untraceable money, clandestine meetings

Hospital Secrets

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The Virgin Islands

Daily News© 2008 Daily News Publishing Co.

Tuesday, December 30, 2008, The Daily News2

By JOY BLACKBURN and TIM F I E L D SDaily News Staff

Adecade of community fundraising for the

Charlotte Kimelman Cancer Institute pro-duced $3.9 million, but Schneider

Regional Medical Center executives have notbeen able to provide a full accounting of exactlyhow their predecessors spent the donated dollars.

The recordkeeping for the cancer center dona-tions is convoluted, uninformative and riddledwith gaps.

• Hospital officials cannot identify wherealmost $2.4 million transferred out of cancer cen-ter bank accounts went.

• Hospital officials cannot locate documenta-tion explaining $40,673 in checks drawn on a can-cer center account.

The Daily News has followed the broken trailthrough bank records the hospital has produced inresponse to the newspaper’s requests under theV.I. Open Records Act. Those records, however,are far from complete.

The hospital provided a spreadsheet of cancercenter donations and expenditures, but it does notadd up. It also does not pinpoint the spending.Instead, it cites large categories of expenditures,such as operations, plant and equipment.

The documents in hand do show that moniesdeposited into accounts designated for the cancercenter were transferred into a hospital generaloperating account — and thus co-mingled withother hospital funds.

In a letter to Banco Popular from ChiefExecutive Officer Rodney Miller Sr. — dated thesame day he announced his resignation fromSchneider Regional Medical Center — Millerclosed the cancer center’s two Banco Popularaccounts. Also on that day — Sept. 20, 2007 —Miller closed two other hospital accounts, and hetransferred the balances from all four accounts toa fifth account at Banco Popular. That fifthaccount is for hospital operating funds.

The total Miller moved out of the two cancercenter accounts was $558,517.46.

The total moved out of the other two accountsis unknown. The records have not been produced.

That fifth account, which has been reduced to

$68,111, remains open, but no executives current-ly working at the hospital are authorized signato-ries on it, and they told The Daily News they donot have current statements for that account.

The state of financial records at the hospitalreflects on the previous administration, which wasunder scrutiny earlier this year by both The DailyNews and the V.I. and U.S. Department of InteriorInspectors General.

The newspaper examined the hospital’s lavishspending on executives’ salaries and benefitscompared with the hospital’s spending on theKimelman center, which was starved for money.The newspaper published a special investigativereport, “Salaries First, Patients Later” on July 28.

The government’s audit focused on hospitalexecutive’s financial management. The inspec-tors general released their audit report on the nightof July 29 and The Daily News published it July3 0 .

Neither the newspaper nor the audit focused onthe cancer center donations.

On Aug. 12, The Daily News launched a searchwith a request, made under the provisions of theV.I. Open Records Act, for all records showingdonations to the cancer center and the spending ofthose funds.

By that time, the top hospital executives hadbeen put on leave — and later were fired — afterthe newspaper and the audit reports, and fivemembers of the board had resigned under pressure

The money trail$3.9 million was raised for cancer center, but where did it go?

See FOLLOWING THE MONEY, next page

The first cancer center account is opened on June 2, 2003. A new cancer center account, under a new name, is opened April 6, 2004.


Charlotte Kimelman at the dedication of theCharlotte Kimelman Cancer Institute in 2006.

Hospital Secrets

from the governor. In October four former hospital officials were

arrested on criminal charges of stealing hospitalm o n e y .

The new hospital administration was slow torespond to Daily News requests, citing the chal-lenge of stepping into a chaotic situation. Over thelast two months, the hospital provided documentspiecemeal and acknowledged that informationwas missing.

Roy L. Schneider Hospital Foundation

Miller, along with Chief Financial Officer PeterNajawicz, Director of Development Loraine Baa-Elisha and Amos Carty Jr. set up a nonprofit cor-poration, the Roy L. Schneider HospitalFoundation, in 2004.

They named Carty, the hospital general counseland chief operating officer, as the resident agent.They all signed the articles of incorporation filedon Dec. 21, 2004, and the Internal RevenueService granted the foundation 501(c)(3) tax-exempt status this year. The foundation’s statedpurpose is to raise funds for and support the hos-pital, health care and related services.

On its website, the Charlotte Kimelman CancerInstitute has a page describing how to make adonation. It says that a single gift donation can bemade to “The Roy L. Schneider HospitalF o u n d a t i o n . ”

Baa-Elisha, who is in charge of fundraising forthe hospital, said she has never seen a check writ-ten to the foundation.

Donors to the cancer center make their checksout to the Charlotte Kimelman Cancer Institute,she said.

The foundation’s revenues and spending areu n k n o w n .

Although nonprofits are tax-exempt, they stillmust file financial reports with the V.I. govern-ment and the IRS. The foundation is not in good

standing with the Lt. Governor’s Office becausethe foundation has not filed any annual financialreports. It also has not filed any IRS Form 990 taxreturns, but it was not required to do so until thisyear, the first year the foundation has 501(c)(3)s t a t u s .

Schneider Regional Medical Center InterimChief Executive Officer Elizabeth Harris said thefoundation does not have any external bankaccounts of its own and instead has an internalaccount in the hospital’s general ledger. She saidthat as far as she knew, the only drawdown on thataccount is to pay Baa-Elisha, who is on contract asdirector of development at Schneider Regional.

Interim CFO Eugene Welsh confirmed thatBaa-Elisha’s $90,000 salary and incentive bonus-es are paid by the foundation.

Documents in hand show that Miller,Najawicz and Baa-Elisha are still the directorsof the foundation and Carty still is residentagent, even though Miller, Najawicz and Cartyno longer are at the hospital and are facing crim-inal charges in V.I. Superior Court. They areaccused of abusing their positions to stealmoney from the hospital.

Baa-Elisha said that to her knowledge, she isnot a director of the foundation.

“No one told me that I was,” she said.Baa-Elisha said that her job as director of devel-

opment is to bring in donations. “I can’t tell you where the monies went,” she

said. “I had no control of spending the money.”“I had no access to funds,” she said.Baa-Elisha said she was not even aware that the

Charlotte Kimelman Cancer Institute bankaccount had been closed.

“In my heart, I don’t think the monies I raisedwere tampered with,” she said. “I don’t believethat any monies I raised — that the people of theVirgin Islands gave to me — were tamperedw i t h . ”

Cancer center accounts

A local cancer center where Virgin Islanderscould receive comprehensive cancer treatmentwithout having to travel off-island was a dreamfor the territory long before ground was broken forthe Charlotte Kimelman Cancer Institute inSeptember 2003.

Henry and Charlotte Kimelman made an initialdonation in the 1980s toward constructing a can-cer treatment center after the 8-year-old son ofsomeone they knew in the Virgin Islands wasdiagnosed with leukemia and had to endure thediscomfort and expense of traveling off-island forcare.

The Kimelman money grew over the years. Itwas held by Partners for Health, a nonprofit com-munity group based on St. Thomas that was

Loraine Baa-ElishaAmos Carty Jr.

The Daily News, Tuesday, December 30, 2008 3


FOLLOWING THE MONEYCONTINUED FROM PAGE 2

Hospital Secrets

The Schneider Regional Hospital Board on June 9, 2004, authorizes onesignature for signing checks and doing business on cancer center accounts.

On Sept. 20, 2007, Rodney Miller Sr. and Amos Carty Jr. close four accountsand transfer balances to a fifth account, without explanation.

Rodney Miller Sr. Peter Najawicz

Cancer centerf u n d i n g

The money to construct theCharlotte Kimelman CancerInstitute, which is part ofSchneider Regional MedicalCenter, and the money tokeep it running comes fromvarious sources.

Those sources include:• Governmentappropriations — The V.I.Legislature appropriatesmoney through SchneiderRegional Medical Center tothe cancer center. Most of themoney goes to pay salaries forstaff who are employees ofthe government. Thelegislature may makeadditional appropriationsearmarked for special projects.• Operating revenues —Schneider Regional bills forthe cancer center’s servicesand collects from patients andthird-party payors, such asMedicare and private insurers.The revenues go to payworkers who are on contract.Schneider Regional officialssay hospital operatingrevenues subsidize operationsat the cancer institute.• Donations — I n d i v i d u a l ,group and corporate gifts,contributions and fundraisingrevenues can be earmarkedfor a special purpose.• Tobacco settlement bondproceeds — This supplied$14.9 million to build theKimelman Institute and wasthe largest single source offunds for the construction.The Tobacco SettlementFinancing Corp. is anindependent instrumentality ofthe V.I. Government thatoversees annual revenuescoming from a 1998 nationalsettlement with four U.S.tobacco companies overhealth damages fromcigarettes. The V.I. government hadjoined in a nationwide lawsuitthat resulted in a $206 billionsettlement to be paid overtime as a reimbursement fortobacco-related health carecosts. The V.I. government’sshare was about $50 millionduring 25 years.To access the money sooner,the 24th Legislature enactedthe Tobacco SettlementFinancing Act in August 2001,which allowed for the creationof the corporation. InNovember 2001, the V.I.government sold the rights tofuture tobacco revenues tothe corporation in order tofloat $21.7 million in bonds.Out of that $21.7 million, thegovernment received $18.4million immediately to pay forhealth care projects:• $5.9 million to SchneiderH o s p i t a l .• $5.9 million to Luis Hospital.• $6.6 million to the HealthDepartment. Additional bonds were sold in2006.

Hospital Secrets


formed 30 years ago specifically to raise moneyfor the hospital.

In late 2002, Miller announced the formation ofa team of architects, medical consultants andphysicians to help the hospital meet its goal ofbuilding a cancer center.

Schneider Hospital ramped up fundraisingefforts in 2003 to help pay for construction of thecancer center starting with a black-tie event, “ACaribbean Gala for Cure,” featuring RobertaFlack in June that year, and the next year, atelethon was added to the mix.

In June 2003, hospital officials designated oneof the hospital’s existing Banco Popular accountsto be the “Roy L. Schneider Hospital CancerCenter” account.

The purpose of the account, according to a let-ter from Beverly Chongasing, hospital board chairat the time, was “to receive donations that will beused exclusively for the establishment of theCancer Center program at the Roy L. SchneiderH o s p i t a l . ”

The letter authorized Miller and Carty as signa-tories on the account. Both men’s signatures wererequired to make withdrawals.

That first year, $241,810 was deposited into thespecial account. Also in that first year, a numberof checks were written, and many were to variousvendors related to the Roberta Flack concert.

Other checks, totaling $40,673, were drawn onthe account that year — and the bank statementsdo not show where those checks went. Therecords do not include photocopies of thosechecks, and the statement summary does not iden-tify the destination.

In February 2004, Partners for Health presentedthe Kimelmans’ donation, which had grown to$560,000, to hospital officials for building thecancer center. That check was deposited into theRoy L. Schneider Hospital Cancer Center fund onFeb. 26, 2004.

A few weeks later, on March 31, 2004, Millerand Carty transferred $600,000 out of the cancercenter account into a hospital general operatingf u n d .

No current hospital official is an authorized sig-natory on the account, Harris said.

The signatories may still be Miller, Carty andNajawicz, she said.

The hospital does not receive statements on theaccount, and Harris told The Daily News that shedid not know where the statements are going.

Only one employee at the hospital has access toview the account online, Harris said.

When The Daily News began asking about theaccount, Harris discovered that it still contains$ 6 8 , 1 1 1 .

She said that current hospital executives willbecome signatories on that Banco Populara c c o u n t .

Schneider Regional now keeps its major operat-ing funds with FirstBank. Harris said that was ineffect when she was appointed to the interim CEOpost in August.

Another account

Nine months after the hospital board created theRoy L. Schneider Hospital Cancer Center fundaccount at Banco Popular, Miller set up a newaccount at Banco Popular for the cancer centerfunds.

In April 2004, Miller wrote Percival Clouden,vice president and operations manager at BancoPopular at the time, saying that the cancer center hadbeen officially designated the Charlotte KimelmanCancer Institute and that fundraising efforts for theinstitute had been extensive and were ongoing.

Checks for a territorywide telethon had beenwritten in the name of the Charlotte KimelmanCancer Institute, he wrote.

“In order to enable us to properly deposit andutilize these funds for the intended purposes, I amrequesting the establishment of a new accountwith the same signatories as the other hospitalaccounts,” Miller wrote in the April 6 letter.

The Charlotte Kimelman Cancer Instituteaccount was opened with a $48,027 deposit onApril 16, 2004. The total of deposits for thatmonth was $61,353.

In June 2004, $44,663.68 was debited from theaccount without explanation.

A receipt that the hospital produced when TheDaily News questioned the transfer states:“Debiting account for transfer of funds as perwritten instructions.”

Hospital officials were unable to find documen-tation showing where the funds went and for whatp u r p o s e .

Access to the money

In June 2004, the hospital board took a step thatallowed hospital executives much more freedomwith the hospital’s money.

The board reduced the number of signaturesrequired for making withdrawals from five BancoPopular accounts — two of which were the cancercenter accounts.

As a result of that action, Miller, Carty andNajawicz did not need a second signature to signand endorse checks, withdraw and deposit fundsand sign letters of credit and orders for the pay-ment of money.

The document authorizing the single signaturewas signed by board chair June Adams and boardsecretary Francis Jackson Jr.

Requiring two signatories on checks is consid-ered a sound business practice and a protectionagainst fraud.

Unexplained withdrawals

In 2004, activity in the Roy L. SchneiderHospital Cancer Center account slowed to a trick-le then stopped entirely, leaving a balance of$198,611 as of October 2004.

At the same time, the balance in the CharlotteKimelman Cancer Institute account grew. The totaldeposits in 2004 were approximately $1.6 million.


FOLLOWING THE MONEYCONTINUED FROM PAGE 3

Hospital Secrets

$600,000 is withdrawn on March 30, 2004, without explanation. RodneyMiller Sr. and Amos Carty Jr. authorized the transfer.

$1 million is deducted on April 4, 2006, without explanation, as shown on aCharlotte Kimelman Cancer Institute bank account statement.

Timeline 1980s• Henry and Charlotte Kimelman donate$250,000 to start a cancer treatmentcenter. The money is invested.

2002• May 13 — Rodney Miller Sr., 29,becomes Schneider Hospital chiefexecutive officer. • Sept. 3 — Schneider Hospital hires anAtlanta firm, Oncology Solutions, to helpdevelop the cancer center. • Nov. 27 — Amos Carty Jr., takes ondual role of chief operating officer andgeneral counsel.• Dec. 4 — Schneider Hospital officialsannounce the formation of a team tohelp develop the cancer treatmentfacility. The team includes well-knownoncologist Dr. Bert Petersen, a V.I.native; the firm Cancer Carepoint torecruit staff; the firm Oncology Solutionsto consult on organizational structure;and Stanley Beaman and Sears,architects, to design the center.

2003• Sept. 30 — Ground is broken for theCharlotte Kimelman Cancer Institute.• Dec. 5 —Schneider Hospital and MyrahKeating Smith Community Health Centerreceive accreditation for the first time.

2004• April 19 — Peter Najawicz becomesSchneider Hospital chief financial officer.

2005• April — Dr. Shirnett Williamson ishired as radiation oncologist for theKimelman Institute.• April 11 — Renee Adams is namedadministrative director for the KimelmanI n s t i t u t e .• May 9 — Schneider Hospital, MyrahKeating Smith Community Health Centeron St. John and Charlotte KimelmanCancer Institute collectively become TheSchneider Regional Medical Center.• July 29 — Schneider RegionalMedical Center officials send out anannouncement that the opening date forthe Kimelman Institute has been pushedback to October. The statement blamesthe pace of progress on weather, delaysin getting supplies on island andunspecified “other issues.”• Nov. 16 — Kimelman is not open.CEO Rodney Miller Sr. tells the boardthat the institute might begin treatingpatients by the end of January 2006.

2006• Jan. 17 — Kimelman is not openbecause construction is still under way.However, Schneider Medical Center hadset this date for the opening and hadsent out invitations to the gala dedicationceremony. The event is held as planned,in front of the unfinished CharlotteKimelman Cancer Institute. Theceremony draws a crowd of dignitariesand donors. • July 26 — Schneider Regionalcelebrates the full transition of medicaloncology services to the CharlotteKimelman Cancer Institute with a ribbon-cutting ceremony. • August — Schneider Regional’s$659,826 bill from Varian MedicalSystems for the radiation machine is 90days overdue and Varian stops serviceuntil it gets a payment. • September — K i m e l m a nadministrator Renee Adams rushes a$234,416 check to Varian MedicalSystems via Express Mail. • December — Schneider Regionalfinancial reports show a $35.1 millionoperating loss. When the government’scontributions are figured in, the overallloss is $6.5 million.• December — Prostate cancersurvivors form a support group.

See TIMELINE, next page

Hospital Secrets


We needed a location where we wouldn’t have the media hangingaround and also it seemed as though every time we planned a

meeting, somehow or the other basically it got out … — Natalie Thomas, former Schneider Regional Medical Center board member

Secret meetingsSchneider Hospital board hid from public


The Schneider Regional Medical Center

board held secret meetings at a local attor-ney’s office to keep the public in the dark

about the board’s business, according to two for-mer board members’ sworn statements.

Francis Jackson Jr. and Natalie Thomas, whoresigned on July 31 under pressure from the gov-ernor, told V.I. Assistant Attorney GeneralDenise George Counts and special investigatorNicholas Peru that they attended two board meet-ings in the law office of Dudley, Topper andFeuerzeig instead of at the boardroom in the hos-pital.

They said the purpose of the meetings was toprepare for a press conference to respond to TheDaily News report, “Salaries First, PatientsLater” and to a joint local and federal auditreport.

They said the board meetings were held at thelaw firm specifically to hide from media scrutiny.

“We needed a location where we wouldn’thave the media hanging around and also itseemed as though every time we planned a meet-ing, somehow or the other basically it got out sowe decided to meet there,” Thomas said underoath.

Transcripts of Thomas and Jackson’s sworntestimony is among exhibits supporting a prose-cution motion filed Nov. 6 in V.I. Superior Courtseeking to disqualify Dudley, Topper andFeuerzeig from representing former SchneiderMedical Center CEO Amos Carty Jr. in a crimi-nal case that arose from the published reports.

Prosecutors contend that the law firm has aconflict of interest because it previously providedlegal advice to the hospital, which is the victim inthe criminal case before the court. The criminalcharges against Carty and other former execu-tives accuse them of stealing from the hospital.

The law firm’s response to the motion char-acterized it as groundless and described attor-ney Henry Feuerzeig’s work for SchneiderRegional Medical Center on the audit responseas “limited.”

Superior Court Judge Michael Dunston has notyet ruled on the motion.

Quorum effect

Of the nine-member hospital board, at leastfive members attended the secret meetings,according to the sworn statements.

In attendance were board chair June Adams,Beverly Chongasing, Doradean Williams,Jackson and Thomas, according to the sworntestimony of Thomas and Jackson.

The law firm characterized the meetings asgatherings of the board’s finance committee,but both Jackson and Thomas described them asboard meetings, with enough board memberspresent to create a quorum.

In addition to the board members, Carty andboard attorney Steve Russell of the Moore,

Dodson and Russell law firm attended, andFeuerzeig attended at least one of the meetings,Thomas and Jackson said.

Carty set up the meetings outside the hospitalto keep reporters from finding out about themeetings, Jackson said under oath.

“The convener of themeeting, which was Mr.Carty, felt that if it was at thehospital, there would be agreater chance that the presswould be present and wantadmission,” Jackson said.“Whereas, if it was outsidethe hospital, the chance isless that the press wouldknow about the meeting andtherefore seek to enter them e e t i n g . ”

Jackson and Thomas saidin their sworn statements thatthe meetings — which lastedmore than three hours each— were not “regular meet-ings” but rather “special” or“emergency” meetings.

No one took notes or min-utes of the meetings and itwas expected that the discus-sions would be confidentialamong those attending,Thomas said.

According to the V.I.Code, all meetings of govern-mental bodies — whichinclude the hospital board —must be open to the public.

The law does not address“special meetings” but ratherdefines a meeting as “delib-erations of at least the num-ber of individual agencymembers required to takeaction on behalf of theagency where such delibera-tions concern the conduct ordisposition of official agencybusiness.”

The five hospital boardmembers present at the twosecret meetings formed aquorum, which meant theboard had enough members, as required by law,to take action.

A habit of hiding

The two meetings at the law firm were not theboards’ first meetings in secret, according toThomas’ sworn statement.

“We decided that we needed to have a specialmeeting and Frank (Jackson) had offered to usehis office, but it changed, and also we had a fewmeetings, special meetings, and they had been atthe hospital, but they were in a small conferenceroom, but every time we met it got out —

whether to the press or — well, I guess the pressbecause they would call,” Thomas said in hersworn testimony.

In May and June, Daily News reportersreceived tips that the board was holding secretmeetings in violation of the V.I. Sunshine Act.

When a Daily News reporterarrived outside the hospitalboardroom in May to coverone of those unannouncedmeetings, Carty told thereporter that the board mem-bers were there for a commit-tee meeting, not for a boardmeeting. He argued that com-mittee meetings did not haveto be open to the public.

Carty refused to allow thereporter access to that meeting.

The reporter asked boardchair Adams to open the meet-ing to the public. Adamsdeferred to Carty’s judgment.

On June 4, a Daily Newsreporter learned that anothersecret meeting was under way.The reporter went to the hospi-tal’s executive office suite tofind the meeting place. Cartymet the reporter outside and stat-ed that there was no board meet-ing, only a committee meeting.

Carty would not say howmany board members werep r e s e n t .

He again argued that the V.I.Code does not contain a statuterequiring that committee meet-ings be open to the public.

Carty barred the reporter fromthe meeting.

At the regular June boardmeeting, minutes from a newlyformed “Governance andStrategic Planning Committee”were submitted to the board.

Those minutes revealed thatthe meeting was the one beingheld on June 4 and it was attend-ed by six board members — aboard quorum.

Those attending that meetingwere Adams, Chongasing, Jackson, Thomas,Mulchand Alwani and Dr. Murli Daswani.

The minutes, which were a summary, not adetailed account, stated that the floor wasopened for discussion of a strategic plan forSchneider Regional and that Natalie Thomaswas asked to take notes and, with assistancefrom staff, to provide a list of strategic planninggoals for the committee to refine.

— Contact Joy Blackburn at 774-8772 ext.

303 or e-mail [email protected] i.

Contact Tim Fields at 774-8772 ext. 364 or

e-mail [email protected].

Hospital Secrets

The convener of themeeting, which wasMr. Carty, felt that ifit was at thehospital, there wouldbe a greater chancethat the press wouldbe present and wantadmission. Whereas,if it was outside thehospital, the chanceis less that the presswould know aboutthe meeting andtherefore seek toenter the meeting.

— Francis Jackson Jr.,former board member

Schneider Regional Medical Center

“

Hospital Secrets

2008• Feb. 20 — Schneider Regionalholds a press conference toannounce the hiring of EdwardAribisala as vice president ofoncology services and administratorat Kimelman. • May 15 — Schneider Regionalofficials launch the “It takes all ofus!” media campaign to boost thehospital’s image.• July 16 — Hospital board adoptsan executive compensation policythat installs controls not in placewhen Rodney Miller Sr. was CEO.• July 28 — The Daily Newspublishes “Salaries First, PatientsLater.” • July 29 — V.I. Inspector Generaland U.S. Department of the InteriorInspector General release scathingjoint audit report on hospital.• July 31 — Gov. John deJongh Jr.requests and receives theresignations of five SchneiderRegional hospital board members:June Adams, Beverly Chongasing,Francis Jackson Jr., Natalie Thomasand Doradean Williams.• Aug. 1 — DeJongh nominates fivenew members to the Schneiderboard: Maria Tankenson Hodge,Cornel Williams, Dilsa Capdeville,Vincent Samuel, Miles Stair. DeJonghinstructs the territorial hospital boardto put Carty and Najawicz on paidleave pending a full investigation.• Aug. 5 — V.I. Attorney Generalseeks and receives a 60-daytemporary restraining order freezingthe personal assets of Miller, Cartyand Najawicz.• Aug 8 to Sept. 2 — Miller empties$1.2 million from his PentagonFederal Credit Union Account thatwas frozen by court order. A creditunion error allows Miller to removethe money. • Aug. 8 — Elizabeth Harris is namedinterim CEO for Schneider Regional.Eugene Welsh is named interim CFO.• Aug. 20 — Judith McDonaldRichardson is named to SchneiderRegional board in place of nomineeDilsa Capdeville, who has withdrawnher name.• Aug. 22 — Miller is arrested andcharged with making fraudulentclaims upon the government byfailing to disclose his bad conductdischarge from the Navy in hisapplication for the Schneider CEO job.• Aug. 28 — Miller pleads not guilty.• Sept. 5 — Territorial boardinstructs Harris to fire Carty and letNajawicz resign or be fired.• Sept. 23 — V.I. Superior CourtJudge James Carroll III deniesmotions by Miller and Najawicz to liftthe TRO freezing their assets.• Sept. 30 — Harris fires Najawicz.• Oct. 7 — Miller, Carty, Najawiczand former Schneider Regional boardchairman June Adams are arrested oncriminal charges containing 144counts combined of embezzlement,conspiracy and fraud.• Oct. 23 — Miller, Carty, Najawiczand Adams plead not guilty. • Nov. 25 — Judge Carroll findsMiller in contempt of court forremoving the money from the frozenPentagon Federal account and ordershim to transfer $515,000 into thecourt registry. Miller’s attorneys, whoare not found in contempt, areordered to transfer $260,000 thatMiller gave them as retainers into ther e g i s t r y .• Dec. 11 — V.I. Supreme Courtgrants Miller and his attorneys apartial, temporary stay of the order todeposit money into the court registry.• Dec. 29 — The Daily Newspublishes the first part of a two-partspecial report, “Hospital Secrets.”

The Daily News, Tuesday, December 30, 2008 7Hospital Secrets

TIMELINECONTINUED FROM PAGE 5

Virgin Islands CodeTitle 1, Chapter 15Sections 251-254

§ 251. Short titleThis chapter may be cited as the “Government inthe Sunshine Act.”

§ 252. Declaration of policyIt is hereby declared to be the policy of theGovernment of the Virgin Islands that the public isentitled to the fullest practicable informationregarding the decision making processes of thisgovernment. It is the purpose of this chapter toprovide the public with such information, whileprotecting the rights of individuals and the ability ofthe Government to carry out its responsibilities.

§ 253. DefinitionsFor purposes of this chapter —

( a ) “Person” means an individual, partnership,corporation, association or public or privateorganization other than a governmental agency.

( b ) “Governmental agency” or “agency” meansall of the following:

( 2 ) All governing and/or administrative boardsand commissions, including but not limited to, theBoard of Medical Examiners, the Board of DentalExaminers, the Board of Nurses Examiners, theBoard of Nurse-Midwife Examiners, the Board ofPharmacy, the Board of Physical Therapy, the Boardof Examiners for the Practice of Veterinary Medicine,the Board of Public Accountancy, the Virgin IslandsElectricians Licensing Board, the Virgin IslandsPlumbers' Licensing Board, the Virgin Islands Boardof Architects, Engineers and Land Surveyors, theVirgin Islands Board of Bar Examiners, the VirginIslands Board for the Licensing of Barbers,Beauticians and Manicurists, the Advisory PlanningBoard, the Banking Board of the Virgin Islands, theBoard of Control of Alcoholic Beverages, the Boardof Directors of the Virgin Islands Public WorksAcceleration Authority, the Board of Education, theBoard of Vocational Education, the Board of Electionsfor the District of St. Thomas-St. John, the Board ofElections for the District of St. Croix, the JointBoards of Parole, the Board of Social Welfare, theBoard of Supervisors of the Virgin IslandsConservation District, the Board of Tax Review, theBoard of Trustees of the College of the VirginIslands, the Board of Zoning, Subdivision andBuilding Appeals, the Board of Trustees of theEmployees Retirement System, the Board ofGovernors of the Virgin Islands Housing Authority,the Virgin Islands Planning Board, the UrbanRenewal Board, the Community Action Policy Board,the Board of Directors of the Virgin Islands PublicTelevision System, the Loan Policy Board of theSmall Business Development Agency, the VirginIslands Wage Board, Board of Directors of the PublicWorks Acceleration Authority, the GovernmentHospital Facilities Boards, the Board of Psychology;

( 3 ) The American Revolution BicentennialCommission, the Commission on Alcoholism andNarcotics, the Virgin Islands Commission on Aging,the Citizens Commission on the Blind, the VirginIslands Criminal Victims Compensation Commission,the Commission on Youth, the GovernmentEmployees Service Commission, the IndustrialDevelopment Commission, the Law EnforcementPlanning Commission, the Virgin Islands LotteryCommission, the Virgin Islands Police and FireCommission, the Public Service Commission, theVirgin Islands Taxicab Commission, the Tax StudyC o m m i s s i o n ;

( 4 ) The Virgin Islands Council on the Arts, theVirgin Islands Tourism Development Council, theCouncil of Economic Advisors, the Judicial Council ofthe Virgin Islands;

( 5 ) The Board of Directors of the VirginIslands Port Authority, the Board of Directors of theVirgin Islands Water and Power Authority, the Boardof Directors of the Magens Bay Authority, the Boardof Commissioners of the Virgin Islands HousingAuthority, the Virgin Islands Public Finance Authority.Said term does not include the courts of the VirginIslands or the Legislature of the Virgin Islands or any

of its Standing or Special Committees.( c ) “Meeting” means the deliberations of at

least the number of individual agency membersrequired to take action on behalf of the agencywhere such deliberations concern the conduct ordisposition of official agency business.

§ 254. Open meetingsof government agencies required

( a ) All meetings of a governmental agency or of asubdivision thereof authorized to take action onbehalf of the agency shall be open to the public.

( b ) Except where the agency finds that the publicinterest requires otherwise, subsection (a) hereofshall not apply to any agency meetings, or anyportion of an agency meeting, or to any meeting, orportion thereof, of a subdivision of said agencyauthorized to take action on its behalf, where theagency or subdivision thereof conducting themeeting properly determines that the meeting or aportion or portions thereof can reasonably beexpected to

( 1 ) disclose information of a personal naturewhere disclosure would constitute a clearlyunwarranted invasion of personal privacy;

( 2 ) involve accusing any person of a crime orformally censuring any person;

( 3 ) disclose information contained ininvestigatory records compiled for law enforcementpurposes, but only to the extent that the disclosurewould —

( A ) interfere with enforcementp r o c e e d i n g s ;

( B ) deprive a person of a right to a fair trialor an impartial adjudication;

( C ) constitute an unwarranted invasion ofpersonal privacy,

( D ) disclose the identity of a confidentials o u r c e ,

( E ) in the case of a record compiled by acriminal law enforcement authority in the course of acriminal investigation, disclose confidentialinformation furnished only by the confidential source.

( F ) disclose investigation techniques andprocedures, or

( G ) endanger the life or physical safety oflaw enforcement personnel;

( 4 ) disclose trade secrets or financial orcommercial information obtained from any person,where such trade secrets or other information couldnot be obtained by the agency without a pledge ofconfidentiality, or where such information must bewithheld from the public in order to preventsubstantial injury to the competitive position of theperson to whom such information relates;

( 5 ) disclose information which must bewithheld from the public in order to avoid prematuredisclosure of an action or a proposed action by —

( A ) an agency which relates to securities,commodities or financial institutions where suchdisclosure would —

( i ) lead to serious financial speculationsin securities or commodities, or

( i i ) seriously endanger the stability ofany financial institution;

( B ) any agency where such disclosurewould seriously frustrate implementation of theproposed agency action, or private action contingentthereon; or

( C ) any agency relating to the purchase bysuch agency of real property.

This paragraph (5) shall not apply in anyinstance where the agency has already disclosed tothe public the content or nature of its proposedaction, or where the agency is required by law tomake such disclosure on its own initiative prior totaking final agency action on such proposal;

( 6 ) disclose information contained in or relatedto examination, operating or condition reportsprepared by, on behalf of, or for the use of anagency responsible for the regulation or supervisionof financial institutions;

( 7 ) specifically concern the agency'sparticipation in a civil action in a federal or local court,or the initiation, conduct or disposition by the agencyof a particular case of formal agency adjudication, orotherwise involving a determination on the recordafter opportunity for a hearing; or

( 8 ) disclose information required to be

withheld from the public by any other statuteestablishing particular types of information.This subsection shall not apply to meetings toconduct public hearings.

(c) (1) Action under subsection (b) shall be takenonly when a majority of the entire membership ofthe agency, or of the subdivision thereof authorizedto conduct the meeting on behalf of the agency,votes to take such action. A separate vote of theagency members, or the members of a subdivisionthereof, shall be taken with respect to each agencymeeting a portion or portions of which areproposed to be closed to the public pursuant tosubsection (b), or with respect to any informationwhich is proposed to be withheld under subsection(b). A single vote may be taken with respect to aseries of meetings, a portion or portions of whichare proposed to be closed to the public, or withrespect to any information concerning such seriesof meetings, so long as each meeting in suchseries involves the same particular matters and isscheduled to be held no more than thirty days afterthe initial meeting i such series. The vote of eachagency member participating in such vote shall berecorded and no proxies shall be allowed.Whenever any person whose interests may bedirectly affected by a meeting requests that theagency close a portion or portions of the meeting tothe public for any of the reasons referred to inparagraphs (2), (3), or (4) of subsection (b), theagency shall vote whether to close such meeting,upon request of any one of its members. Withinone day of any vote taken pursuant to thisparagraph, the agency shall make publicly availablea written copy of such vote.

( 2 ) Any agency, a majority of whose meetingswill properly be closed to the public, in whole or inpart, pursuant to paragraphs (4), (5)(A), (6), or (7) ofsubsection (b), or any combinations thereof, mayprovide by regulation for the closing of suchmeetings, or portion of such meetings, so long as amajority of the members of the agency, or of thesubdivision thereof conducting the meeting, votes atthe beginning of such meeting, or portion thereof, toclose the meeting, and a copy of such vote is madeavailable to the public. The provisions of thissubsection shall not apply to any meeting to whichsuch regulations apply: Provided, That the agencyshall, except to the extent that the provisions ofsubsection (b) may apply, provide the public withpublic announcement of the date, place, and subjectmatter of the meeting at the earliest practicableo p p o r t u n i t y .

( 3 ) A copy of the vote on any action taken byan agency in a meeting closed to the public pursuantto subsection (b) must be made available to thepublic, excluding any information exempted frompublic disclosure under subsection (b). Thedocumentation of the vote must include:

( A ) the names of all agency memberspresent at the time of the vote;

( B ) a description of the matter on whichthe vote was taken; and

( C ) a record of each member's vote.( d ) Each agency shall maintain an up-to-date

schedule of the meetings which are to be held by itor any subdivision thereof, which schedule shallindicate whether the meeting, or portion thereof, willbe open or closed to the public and if closed thereason therefor. The schedule shall be available forpublic inspection during all the regular working hoursof said agency.

( e ) The secretary or clerk of each agency, or aperson designated by the head of the agency, shallmaintain a list of persons who request notification ofall meetings open to the public, or of meetings whencertain specified formal action will be taken, and shallprovide such persons reasonable advancenotification of such meetings.

( f ) No resolution, rule, regulation, ordinance, orformal action of any agency including the vote of anagency pursuant to subsection (c)(2) of this sectionshall be valid unless taken or made at a meeting thatmeets the requirements of this section.

(g) (1) Subject to the provisions in subsection (b)of this section, all meetings of Standing and SpecialCommittees of the Legislature of the Virgin Islands,established pursuant to the Rules of the Legislature,shall be open to the public.

V.I. Sunshine ActPublic is entitled to attend and view

decision-making processes of boards and agencies

Hospital Secrets

VIDN_HospitalCorruption

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Transcript of VIDN_HospitalCorruption