Cardinal Innovations Healthcare has a new board of directors. It includes a few who were on the previous board. State officials fired that board when it took over the behavioral health care organization last month, believing them to be a big part of Cardinal’s problem. After all, it was the board that approved the excessive CEO pay and severance packages.
The new board has some familiar faces. One is Mecklenburg County Commissioner George Dunlap. He says the old board was dysfunctional, but didn’t think he was part of the problem. He has higher hopes for this board.
“I believe [it] will have, first, the best interest of the clients Cardinal serves,” Dunlap said. “Second, understanding of fiduciary responsibility and its obligation to manage state funds appropriately. And people who are willing to work together and not expect that everyone has to all agree.”
Two other former board members will also be back. Marcelle Smith, a commissioner in Halifax County and attorney Bryan Thompson.
Thompson was mysteriously fired by his fellow board members at the board's last meeting in November. Board minutes show Thompson was the only one to vote against giving the former CEO a 40 percent raise this year. Dunlap, Smith and Thompson say 17 people were appointed to the board Thursday. Twenty county commissioners in Cardinal’s service area appointed the new board.
Former Cardinal Leaders File a Countersuit Against DHHS
The previous board is fighting back against the state’s takeover of Cardinal in court. In a countersuit, the former CEO and board claim there wasn’t financial mismanagement or regulatory noncompliance as the state said when it took over on November 27.
The filing claims the state used the $3.8 million in severance paid out to the former CEO Richard Topping and other executives as a pretext to remove the board and takeover Cardinal. Topping claims that the state was aware the severance would be paid as part of a deal to get in compliance. Topping and the board also claim they had a settlement with the North Carolina Department of Health and Human Services over the weekend.
“The deal was the Secretary would acknowledge the board at least acted in good faith,” said Topping. “The board would then resign and then DHHS could go off and appoint a new board and do whatever they wanted with Cardinal.”
DHHS said it was talking to Cardinal about under what terms it would dismiss the case, but no final agreement was reached.
“We are extraordinarily disappointed that Cardinal’s former leadership is focused on the past. We remain temporarily in charge of Cardinal, and are focused on rebuilding the public trust and moving the organization forward," said Secretary Cohen in a statement.
Below is a list of the new board members.
Contact the reporters by e-mail at email@example.com or firstname.lastname@example.org or 704-926-3859