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Province orders care home to end contract with CEO

By: Larry Kusch

Posted: 03/21/2013 10:45 AM | Comments: 0 | Last Modified: 03/21/2013 3:41 PM | Updates

Bethania Mennonite Personal Care Home (WAYNE GLOWACKI / WINNIPEG FREE PRESS) Photo Store

The provincial Health Department is ordering the board of a personal care home group to terminate its illegal contract with the organization’s CEO.

Bethania operates two personal care homes in Winnipeg, on Pembina Highway and Concordia Avenue.

Bethania Group Personal Care Homes has until April 2 to comply with the order.

The illegal contract with Ray Koop came to light after a financial audit of Bethania Group, Health Minister Theresa Oswald said in a press release this morning.

The audit found:

Bethania’s board of directors allowed the CEO to retire from his $160,000-a-year position, collect a pre-retirement payment worth nearly half his annual salary, start collecting his pension and start a new contract in the same position the next business day with a salary increase;
This occurred while a government-imposed executive salary freeze is in place;
The CEO and board breached the regulations and the intent of the new legislation; and
The CEO was actively involved in advising the board on the structure of his new remuneration package and therefore in a conflict of interest.

The contract between Bethania and its CEO is in contravention of legislation the Manitoba government passed just last year prohibiting such a scenario, Oswald said.

"I'm disappointed we had to use this legislation so soon after it was enacted, but Manitoba families expect their tax dollars to be used ethically," the minister said. "Bethania delivers excellent care, but this audit has revealed a series of decisions made by the board and the CEO that fly in the face of new provincial legislation and widely recognized conflict of interest practices."

A man who volunteers alongside his wife at the Pembina location every Thursday morning said he had heard no rumours of an illegal contract provided to the group’s CEO.

The man, who did not want to be named, said he knew nothing of the organization’s financial operations.

But he praised the facility’s atmosphere. "I do know that it is a very nice environment," he said.

Manitoba has high standards for transparency and accountability in health care, the minister said, adding CEOs of personal care homes are already required to publicly disclose their salaries and recent amendments to the Regional Health Authorities Act will strengthen the transparency and accountability of public funding in the health-care sector by:

implementing tighter controls on executive compensation in regional health authorities (RHAs), hospitals and other health corporations;
requiring the expenses of CEO's of RHAs, hospitals and personal care homes be posted online; and
ensuring that if a health organization has a surplus of public funds, there is improved accountability and transparency for how those funds are used.

The government audit document is available at www.wrha.mb.ca/bethania.

History

Updated on Thursday, March 21, 2013 at 11:09 AM CDT: corrects typo in headline

11:19 AM: updates

11:50 AM: CEO is Ray Koop.

2:28 PM: adds photo

3:41 PM: removes duplicate word

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