Lawmakers Still Pushing To Get Severance Money Back From Cardinal

Jan 16, 2018

Credit Alex Olgin / WFAE News

Lawmakers received a brief update about Cardinal Innovations Healthcare Tuesday. One key point at issue - just when the state will return control of the organization to its newly picked board of directors.

The state took over Cardinal back in November citing serious financial mismanagement as the rationale.

And under state leadership North Carolina Secretary of Health and Human Services Mandy Cohen says when it comes to the day-to-day, currently Cardinal is a-okay.

"There was no service interruptions," she said, "they're paying their bills, they're paying providers, they're authorizing services."

Cardinal, by the way, is basically a Medicaid funded insurance company which pays for mental health, addiction treatment and developmental services for patients in 20 counties.

But the good report from Secretary Cohen doesn’t mean past controversies about excessive CEO pay and overly generous severance packages for executives have been put to bed.

Cardinal's budget is paid for by taxpayers. Yet it paid $3.8 million in severance to former CEO Richard Topping and three other key employees who left just after Topping was fired. To make amends Cardinal says it will move an equal amount of money from its administrative budget to patient care. But lawmakers want that $3.8 million clawed back directly from the former employees. To that Secretary Cohen said simply, "It is a legal question and it's something our lawyers are looking at."

So, too, are lawyers with North Carolina's attorney general's office.

On the positive front, Cohen said her department is still on track to return Cardinal to self-rule in the near-term.